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 Registrantþ
Filed by a Party other than the Registranto¨
Check the appropriate box:
o¨ Preliminary Proxy Statement
o¨Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
þ Definitive Proxy Statement
o¨ Definitive Additional Materials
o¨ Soliciting Material Under §240.14a-12
Kirby Corporation
(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):
þ | No fee required. |
Fee computed on table below per Exchange Act Rules14a-6(i)(1) and0-11. |
(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 Rule0-11 (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 Rule0-11(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: |
KIRBY CORPORATION |
Notice of 20112014
Annual Meeting of Stockholders
and
Proxy Statement
Meeting Date: April 26, 201129, 2014
YOUR VOTE IS IMPORTANT
PLEASE PROMPTLY MARK, DATE, SIGN AND RETURN
YOUR PROXY CARD IN THE ENCLOSED ENVELOPE
55 Waugh Drive, Suite 1000
P. O. Box 1745
Houston, Texas77251-1745
March 18, 2011
Dear Fellow Stockholders:
On behalf of the Board of Directors, we cordially invite you to attend the 20112014 Annual Meeting of Stockholders of Kirby Corporation to be held on Tuesday, April 26, 2011,29, 2014, at 10:00 a.m. (CDT). The meeting will be held at 55 Waugh Drive, 9th Floor, Houston, Texas 77007. We look forward to personally greeting those stockholders who will be able to attend the meeting.
This booklet contains the notice of the Annual Meeting and the Proxy Statement, which contains information about the proposals to be voted on at the meeting, Kirby’s Board of Directors and its committees and certain executive officers. This year you are being asked to elect three Class I directors, ratify the Audit Committee’s selection of KPMG LLP as Kirby’s independent registered public accounting firm for 20112014 and cast an advisory votesvote on executive compensation and the frequency of advisory votes on executive compensation.
In addition to the formal proposals to be brought before the Annual Meeting, there will be a report on our Company’s operations, followed by a question and answer period.
Your vote is important. Please ensure that your shares will be represented at the meeting by completing, signing and returning your proxy card in the envelope provided whether or not you plan to attend personally.
Thank you for your continued support and interest in Kirby Corporation.
Sincerely, |
JOSEPH H. PYNE |
Chairman of the Board and Chief Executive Officer |
KIRBY CORPORATION
P. O. Box 1745
Houston, Texas 77251-1745
NOTICE OF CONTENTS
Date: | Tuesday, April | |||
Time: | 10:00 a.m. CDT | |||
Place: | 55 Waugh Drive | |||
9th Floor | ||||
Houston, Texas 77007 |
Proposals to be voted on at the Kirby Corporation 20112014 Annual Meeting of Stockholders are as follows:
1. Election of three Class I directors;
2. Ratification of the Audit Committee’s selection of KPMG LLP as Kirby’s independent registered public accounting firm for 2011;
3. Advisory vote on the approval of the compensation of Kirby’s named executive officers;
4. Advisory vote on the frequency of advisory votes on executive compensation; and
You have the right to receive this notice and vote at the Annual Meeting if you were a stockholder of record at the close of business on March 1, 2011.3, 2014. Please remember that your shares cannot be voted unless you sign and return the enclosed proxy card, vote in person at the Annual Meeting, or make other arrangements to vote your shares.
We have enclosed a copy of Kirby Corporation’s 20102013 Annual Report to stockholders with this notice and Proxy Statement.
For the Board of Directors, |
THOMAS G. ADLER |
Secretary |
March 18, 2011
PROXY STATEMENT
GENERAL INFORMATION
This Proxy Statement is furnished in connection with the solicitation of proxies on behalf of the Board of Directors (the “Board”) of Kirby Corporation (the “Company”) to be voted at the Annual Meeting of Stockholders to be held at 55 Waugh Drive, 9th Floor, Houston, Texas, on April 26, 2011,29, 2014, at 10:00 a.m. (CDT).
Whenever we refer in this Proxy Statement to the Annual Meeting, we are also referring to any meeting that results from an adjournment or postponement of the Annual Meeting. The Notice of Annual Meeting, this Proxy Statement, the proxy card and the Company’s Annual Report, which includes the Annual Report onForm 10-K for 2010,2013, are being mailed to stockholders on or about March 18, 2011.
SOLICITATION OF PROXIES
The Proxy Card
Your shares will be voted as specified on the enclosed proxy card. If a proxy is signed without choices specified, those shares will be voted for the election of the Class I directors named in this Proxy Statement, for the ratification of the Audit Committee’s selection of KPMG LLP as the Company’s independent registered public accounting firm for 2011,2014, for the approval on an advisory basis of executive compensation for the approval on an advisory basis of holding the advisory vote on executive compensation every year and at the discretion of the proxies on other matters.
You are encouraged to complete, sign and return the proxy card even if you expect to attend the meeting. If you sign a proxy card and deliver it to us, but then want to change your vote, you may revoke your proxy at any time prior to the Annual Meeting by sending us a written revocation or a new proxy, or by attending the Annual Meeting and voting your shares in person.
Cost of Soliciting Proxies
The cost of soliciting proxies will be paid by the Company. The Company has retained Georgeson Inc. to solicit proxies at an estimated cost of $5,750,$6,000, plusout-of-pocket expenses. Employees of the Company may also solicit proxies, for which the expense would be nominal and borne by the Company. Solicitation may be by mail, facsimile, electronic mail, telephone or personal interview.
VOTING
Stockholders Entitled to Vote
Stockholders of record at the close of business on March 1, 20113, 2014 will be entitled to notice of, and to vote at, the Annual Meeting. As of the close of business on March 1, 2011,3, 2014, the Company had 53,667,64856,932,919 outstanding shares of common stock. Each share of common stock is entitled to one vote on each matter to come before the meeting.
Quorum and Votes Necessary to Adopt Proposals
In order to transact business at the Annual Meeting, a quorum consisting of a majority of all outstanding shares entitled to vote must be present. Abstentions and proxies returned by brokerage firms for which no voting instructions have been received from their beneficial owners will be counted for the purpose of determining
1
whether a quorum is present. A majority of the votes cast (not counting abstentions and broker nonvotes) is required for the election of directors (Proposal 1). A majority of the outstanding shares entitled to vote that are represented at the meeting in person or by proxy is required for the ratification of the selection of KPMG LLP as the Company’s independent registered public accounting firm for 20112014 (Proposal 2). Proposal 3 and Proposal 4 areis a non-binding
2
Please note that if your shares are held in the name of a brokerage firm on your behalf, your broker may not vote your shares on the election of directors or the matters related to executive compensation without voting instructions from you.
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON APRIL 26, 2011
This Proxy Statement and the Company’s 20102013 Annual Report, which includes the Annual Report onForm 10-K filed with the Securities and Exchange Commission (“SEC”), are available electronically at www.edocumentview.com/kex.
The following proposals will be considered at the meeting:
Proposal 1 | — | Election of three Class I directors | ||||||
Proposal 2 | — | Ratification of the selection of KPMG LLP as the Company’s independent registered public accounting firm for | ||||||
Proposal 3 | — | Advisory vote on the approval of the compensation of | ||||||
The Board of Directors of the Company unanimously recommends that you vote “FOR” the Board’s nominees for director, “FOR” the selection of KPMG LLP as our independent registered public accounting firm for 2011,2014 and “FOR” approval of our executive compensation and “FOR” an annual advisory vote on executive compensation.
ELECTION OF DIRECTORS (PROPOSAL 1)
The Bylaws of the Company provide that the Board shall consist of not fewer than three nor more than fifteen members and that, within those limits, the number of directors shall be determined by the Board. The Bylaws further provide that the Board shall be divided into three classes, with the classes being as nearly equal in number as possible and with one class being elected each year for a three-year term. Effective at the 20112014 Annual Meeting, the size of the Board will be set at nine. Three Class I directors are to be elected at the 20112014 Annual Meeting to serve until the Annual Meeting of Stockholders in 2014.
Each nominee named below is currently serving as a director, with the exception of David W. Grzebinski, and each has consented to serve for the new term if elected. James R. Clark,David L. Lemmon and George A. Peterkin, Jr., who hashave served as a directordirectors since 2008,2006 and 1969, respectively, will not stand for reelection as director.directors. If any nominee becomes unable to serve as a director, an event currently not anticipated, the persons named as proxies in the enclosed proxy card intend to vote for a nominee selected by the present Board to fill the vacancy.
In addition to satisfying, individually and collectively, the Company’s Criteria for the Selection of Directors discussed under the “THE BOARD OF DIRECTORS — Governance Committee” below, each of the directors has extensive experience with the Company or in a business similar to one or more of the Company’s principal businesses or the principal businesses of significant customers of the Company. The brief biographies of each of the nominees and continuing directors below includes a summary of the particular experience and qualifications that led the Board to conclude that he should serve as a director.
3
2
The Board of Directors of the Company unanimously recommends that you vote “FOR” the election of each of the following nominees for election as a director.
Nominees for Election as Class I directors to serve until the Annual Meeting of Stockholders in 20142017
Director since | ||
Age |
Mr. LemmonAlario is a private investor. He served asChairman of the Board, President and Chief Executive Officer of Colonial PipelineKey Energy Services, Inc. (“Key Energy”), a publicly traded oilfield service company listed on the New York Stock Exchange (“NYSE”). He has served in senior executive positions with Key Energy since 2004. Prior to joining Key Energy, Mr. Alario served as Vice President of BJ Services Company, an interstate common carrieroilfield service company, from 2002 to 2004, and served for over 21 years in various capacities, most recently Executive Vice President, of refined liquid petroleum products, from 1997 to 2006. Prior to that, he held management positions with Amoco CorporationOSCA, Inc., also an oilfield service company. He currently serves as Chairman, Director and Amoco Pipeline.Executive Committee member of the National Ocean Industries Association and serves as a member of the American Association of Drilling Engineers and the Petroleum Equipment Suppliers Association. He serves as a member of the Audit Committee. Mr. Lemmon isAlario also served as a director of Teekay Offshore GP L.L.C.,Seahawk Drilling, Inc. from 2009 to 2011.
Mr. Alario has over 30 years of experience in the general partner of Teekay Offshore Partners L.P.,oilfield service business, currently serving as Chief Executive Officer with both operating and Deltic Timber Corporation. Mr. Lemmon was a director and chairman of the audit committee of Pacific Energy GP L.L.C., the general partner of Pacific Energy Partners L.P., from 2002 to 2006.
Richard R. Stewart | Director since 2008 | |
Houston, Texas | Age |
Mr. Stewart served as President and Chief Executive Officer of GE Aero Energy, a division of GE Energy, and as an officer of General Electric Company (“General Electric”), from 1998 until his retirement in December 2006. From 1972 to 1998, Mr. Stewart served in various positions at Stewart & Stevenson Services, Inc. (“Stewart & Stevenson”), including Group President and member of the Board of Directors. He serves as a member of the Audit Committee. Mr. Stewart is also a director of Eagle Materials Inc. and a former director of Lufkin Industries, Inc.
During a35-year business career, Mr. Stewart has been the principal executive officer with both operating and financial responsibility for the diesel engine power and service businesses at Stewart & Stevenson and then at GE Aero Energy. Mr. Stewart’s extensive experience in the diesel engine business is valuable to the Board in its oversight of the Company’s diesel engine services business and complements the predominately marine transportation and petrochemical industry experience of a number of the Company’s other directors.
4
David W. Grzebinski | New Director | |
Houston, Texas | Age 52 |
Mr. Grzebinski has served as President and Chief Operating Officer of the Company since January 2014. He served as an Executive Vice President of the Company from February 2010 to January 2014, as Chief Financial Officer of the Company from March 2010 to February 2014 and as Chairman of the Company’s principal offshore marine transportation subsidiary from February 2012 to March 2013. Prior to joining the Company in February 2010, he served in various administrative and operating positions with FMC Technologies Inc. (“FMC”), a global provider of advanced technology systems and products for the energy industry, including Controller, Energy Services, Treasurer and Director of Global SAP and Industry Relations. Prior to joining FMC, he was employed by The Dow Chemical Company.
3
As the announced successor to Joseph H. Pyne as Chief Executive Officer of the Company during the current year, Mr. Grzebinski will assume primary responsibility for the strategic direction and operations of the Company. As has historically been the case, the Board of the Company considers it an important element of the governance of the Company for the Chief Executive Officer to be a member of the Board.
The following persons are directors of the Company who will continue in office.
Continuing Class II directors, serving until the Annual Meeting of Stockholders in 20122015
Bob G. Gower | Director since 1998 | |
Houston, Texas | Age |
Mr. Gower is a private investor. He has served as President and Chief Executive OfficerChairman of Carbon Nanotechnologies,the Board of Ensysce Biosciences, Inc., a technology leader in small-diameter carbon nanotubes, until 2007.company developing cancer therapeutics using nanotechnology, since 2008. Mr. Gower serves as Chairman of the Audit Committee, is a member of the Executive Committee and Compensation Committee, and has been chosen by the non-management directors to serve as the presiding director at executive sessions of the non-management directors.
Mr. Gower has 46 years of experience in the chemical business, including 11 years as the Chief Executive Officer of Lyondell Petrochemical Company. The transportation of petrochemicals generates a major portion of the Company’s marine transportation revenues and Mr. Gower’s knowledge of the chemical business is valuable to the Board.
Monte J. Miller | Director since 2006 | |
Durango, Colorado | Age |
Mr. Miller is a consultant and private investor. He served as Executive Vice President, Chemicals, of Flint Hills Resources, LP (“Flint Hills”), a company engaged in crude oil refining, transportation and marketing, and the production of petrochemicals, from 2003 to 2006. From 1999 to 2003, he was Senior Vice President of Koch Chemical Company, a predecessor company of Flint Hills. Mr. Miller serves as a member of the Compensation Committee and Governance Committee.
Mr. Miller has 30 years of experience in the petrochemical and refining business. A significant volume of petrochemical products isand refined petroleum products are transported coastwise and on the inland waterways and petrochemicals and refined petroleum products represent a major portion of the Company’s business, so Mr. Miller’s extensive knowledge about petrochemical and refining companies, which constitute a substantial part of the Company’s customer base, as well as the products they ship and the end users of the products, is valuable to the Board. He also has experience in developing and administering incentive compensation programs at companies similar in size to the Company.
Joseph H. Pyne | Director since 1988 | |
Houston, Texas | Age |
Mr. Pyne is the Chairman of the Board President and Chief Executive Officer of the Company. He serves as a member of the Executive Committee.
Mr. Pyne has been with the Company for 3336 years, servinghaving served as President of its principal marine transportation subsidiary prior to becoming President and Chief Executive Officer of the Company. HeSince April 2010, he has served as either Chairman of the Board, President and Chief Executive Officer of the Company since April 2010.or
4
Chairman of the Board and Chief Executive Officer of the Company. He has primary responsibility for the business and strategic direction of the Company and is an essential link between the Board and the Company’sday-to-day operations. Mr. Pyne has overall knowledge of all aspects of the Company, its operations, customers, financial condition and strategic planning. With the retirement of C. Berdon Lawrence as Chairman of the Board of the Company in April 2010, Mr. Pyne is the only management representative on the Board.
Continuing Class III directors, serving until the Annual Meeting of Stockholders in 20132016
C. Sean Day | Director since 1996 | |
Greenwich, Connecticut | Age |
Mr. Day is Chairman of Teekay Corporation, a diversified foreign flag tank vessel owner and operator.shipping group. He serves as Chairman of the Governance Committee and is a member of the Compensation Committee. He is also Chairman of Teekay GP L.L.C., the general partner of Teekay LNG Partners L.P., Chairman of Teekay Offshore GP L.L.C., the general partner of Teekay Offshore Partners L.P., Chairman of Teekay Tankers Ltd. and Chairman of Compass Diversified Holdings.
5
William M. Lamont, Jr. | Director since 1979 | |
Dallas, Texas | Age |
Mr. Lamont is a private investor. He serves as Chairman of the Compensation Committee and is a member of the Executive Committee and Governance Committee.
Mr. Lamont and his family have been major stockholders of the Company since its formation and he has been a director of the Company throughout its transformation from a company engaged in the oil and gas and insurance businesses, among others, into the largest inlanddomestic tank barge company in the United States.States, as well as a significant presence in the diesel engine services business. Through his private investment activities, Mr. Lamont also has extensive experience in financial analysis and in financial markets.
Director since | ||
Age |
Mr. Lawrence is a consultant for the Company and a private investor. He hasWaterman served as Chairman EmeritusPresident and Chief Executive Officer of the Board of the Company since April 2010 and served as Chairman of the Board of the Company from 1999 until his retirement in April 2010. He was the founder and former President of Hollywood Marine,Penn Maritime Inc. (“Hollywood”Penn”), an inland tank barge company acquired from 1983 through 2012 until the acquisition of Penn by the Company in 1999. Mr. Lawrence serves as ChairmanDecember 2012. Penn was a coastwise tank barge operator, transporting primarily refinery feedstocks, asphalt and crude oil along the East Coast and Gulf Coast of the Executive Committee. Mr. LawrenceUnited States. He is also a director and past Chairman of Kinder Morgan Energy Partners, L.P.
Mr. LawrenceWaterman has over 4036 years of experience in the inlandcoastal tank barge business with Penn and predecessor companies, building HollywoodPenn into one of the largest coastal tank barge operators in the United States beforeStates. The Company significantly expanded its mergercoastal marine transportation business with several major acquisitions in 2011 and 2012. Mr. Waterman’s extensive experience in that business and knowledge of its markets and customers are valuable to the Company. Since the merger, he and Mr. Pyne have successfully integrated the two companies into an efficient and safety-conscious operation with the size and flexibility to serve the needs of the largest customers. In addition to Mr. Lawrence’s extensive knowledgeBoard in its oversight of the Company’s operationsexpanding coastwise business and customer base, he has long been active in industry associations that monitor significant legislative and regulatory developments along with other issues critical tocomplement the inland marine transportation industry.
Except as noted, each of the nominees for director and each of the continuing directors has been engaged in his principal occupation for more than the past five years.
5
THE BOARD OF DIRECTORS
The Company’s business is managed under the direction of the Board, which is responsible for broad corporate policy and for monitoring the effectiveness of Company management. Members of the Board are kept informed about the Company’s businesses by participating in meetings of the Board and its committees, through operating and financial reports made at Board and committee meetings by Company management, through various reports and documents sent to the directors for their review and by visiting Company facilities.
Director Independence
The New York Stock Exchange (“NYSE”)NYSE listing standards require listed companies to have at least a majority of independent directors. For a director to be considered independent, the Board must determine that the director does not have any direct or indirect material relationship with the Company.
The Board has determined that the following incumbent directorsC. Sean Day, Bob G. Gower, William M. Lamont, Jr., David L. Lemmon, Monte J. Miller, George A. Peterkin, Jr. and Richard R. Stewart have no relationship with the Company except as directors and stockholders and are independent within the meaning of the NYSE corporate governance rules:
6
In December 2012, the Company acquired Penn and an affiliated company from William M.Waterman and members of his family for approximately $175 million in cash and Company stock. Mr. Waterman and his family sold their entire interest in Penn and affiliated companies to the Company and he resigned from all director and officer positions he held with Penn and affiliated companies contemporaneously with the closing of the acquisition by the Company. In connection with the acquisition, Mr. Waterman entered into a three-year noncompetition agreement with the Company that is not in any way contingent on continued service with the Company or any of its subsidiaries. A portion of the purchase price for the acquisition consisting of approximately $24 million in cash and 83,825 shares of Company stock is held in escrow to secure the sellers’ indemnification of the Company for breaches of representations and warranties in the purchase agreement. Except to the extent of pending claims, if any, the escrow will terminate on March 31, 2014. The Board determined that the existence of the escrow account does not affect Mr. Waterman’s independence.
The Board has established four standing committees, including the Audit Committee, the Compensation Committee and the Governance Committee, each of which is briefly described below. The fourth committee, the Executive Committee, may exercise all of the power and authority of the Board in the management of the business and affairs of the Company when the Board is not in session, except the power or authority to fill vacancies in the membership of the Board, to amend the Bylaws of the Company and to fill vacancies in the membership of the Executive Committee.
6
Audit Committee
All of the members of the Audit Committee are independent, as that term is defined in applicable SEC and NYSE rules. In addition, the Board has determined that all of the members of the Audit Committee are “audit committee financial experts,” as that term is defined in SEC rules. The Audit Committee operates under a written charter adopted by the Board. A copy of the charter is available on the Company’s web site at www.kirbycorp.com in the Investor Relations section under Corporate Governance.
Principal Functions | Members | |
• Monitor the Company’s financial reporting, accounting procedures and systems of internal control | Bob G. Gower (Chairman) Richard J. Alario David L. Lemmon Richard R. Stewart | |
• Select the independent auditors for the Company | ||
• Review the Company’s audited annual and unaudited quarterly financial statements with management and the independent auditors | ||
• Monitor the independence and performance of the Company’s independent auditors and internal audit function | ||
• Monitor the Company’s compliance with legal and regulatory requirements |
Compensation Committee
All of the members of the Compensation Committee are independent, as that term is defined in applicable SEC and NYSE rules. In addition, all of the members of the Committee are “Non-Employee Directors” and “outside directors” as defined in relevant federal securities and tax regulations. The Compensation Committee operates under a written charter adopted by the Board. A copy of the charter is available on the Company’s web site at www.kirbycorp.com in the Investor Relations section under Corporate Governance.
Principal Functions | Members | |
• Determine the compensation of executive officers of the Company | William M. Lamont, Jr. (Chairman) C. Sean Day Bob G. Gower Monte J. Miller | |
• Administer the Company’s annual incentive bonus program | ||
• Administer the Company’s stock option, restricted stock and incentive plans and grant stock options, restricted stock and performance awards under such plans |
Governance Committee
All of the members of the Governance Committee are independent, as that term is defined in NYSE rules. The Committee operates under a written charter adopted by the Board. A copy of the charter is available on the Company’s web site at www.kirbycorp.com in the Investor Relations section under Corporate Governance.
Principal Functions | Members | |
• Perform the function of a nominating committee in recommending candidates for election to the Board | C. Sean Day (Chairman) William M. Lamont, Jr. Monte J. Miller | |
• Review all related | ||
• Oversee the operation and effectiveness of the Board |
7
7
compliance with SEC and NYSE requirements relating to the composition of the Board and its committees, as well as character, integrity, experience, understanding of the Company’s business and willingness to commit sufficient time to the Company’s business. The criteria are available on the Company’s web site at www.kirbycorp.com in the Investor Relations section under Corporate Governance.
In addition to the criteria, the Governance Committee and the Board will consider diversity in business experience, professional expertise, gender and ethnic background in evaluating potential nominees for director. The Company’s Corporate Governance Guidelines and Governance Committee Charter include provisions concerning the consideration of diversity in business experience, professional skills, gender and ethnic background in selecting nominees for director.
When there is a vacancy on the Board (i.e., in cases other than the nomination of an existing director for reelection), the Board and the Governance Committee have considered candidates identified by executive search firms, candidates recommended by stockholders and candidates recommended by other directors. The Governance Committee will continue to consider candidates from any of those sources when future vacancies occur. The Governance Committee does not evaluate a candidate differently based on whether or not the candidate is recommended by a stockholder.
Attendance at Meetings
It is the Company’s policy that directors are expected to attend Board meetings and meetings of committees on which they serve and are expected to attend the Annual Meeting of Stockholders of the Company. During 2010,2013, the Board met eightfive times, the Audit Committee met eight times, the Compensation Committee met fiveseven times and the Governance Committee met four times. Each director attended at least 94% of the aggregate numberall of the meetings of the Board and of the committees on which he served. All directors attended the 20102013 Annual Meeting of Stockholders of the Company.
Director Compensation
Directors who are employees of the Company receive no additional compensation for their servicesservice on the Board or Board committees.Board. Compensation of nonemployee directors is determined by the full Board, which may consider recommendations of the Compensation Committee. Past practice has been to review director compensation when the Board believes that an adjustment may be necessary in order to remain competitive with director compensation of comparable companies. Management of the Company periodically collects published survey information on director compensation for purposes of comparison.
Each nonemployee director receives an annual fee of $24,000, a fee of $1,250 for each Board meeting and a fee of $3,000 for each Committeecommittee meeting attended. A director may elect to receive the annual fee in cash, stock options or restricted stock. The Compensation and Governance Committee Chairmen receive an additional $10,000 retainer per year, the Audit Committee Chairman receives an additional $15,000 retainer per year and the presiding director at executive sessions of the non-management directors receives an additional $5,000 retainer per year. Directors are reimbursed for reasonable expenses incurred in attending meetings.
In addition to the fees provided to the directors described above, the Company has a nonemployee director stock option plan under which nonemployee directors are granted stock options and restricted stock awards. The Company’s 2000 Nonemployee Director Stock Option Plan (the “2000 Director Plan”) provides for the automatic grant to nonemployee directors of stock options for 10,000 shares of common stock on the date of first election as a director and stock options for 6,000 shares and 1,000 shares of restricted stock immediately after each annual meeting of stockholders. The 2000 Plan also provides for discretionary grants of an aggregate of 10,000 shares in the form of stock options or restricted stock. In addition, the 2000 Director Plan provides for the issuance of stock options or restricted stock in lieu of cash for all or part of the annual director fee. A director who elects to receive options in lieu of the annual cash fee will be granted an option for a number of shares equal to (a) the amount of the fee
8
for which the election is made divided by (b) the fair market value per share of the common stock on the date of grant multiplied
8
In 2008, the Board established stock ownership guidelines for officers and directors of the Company. The guidelines were effective January 1, 2009 and nonemployee directors must be in compliance within five years after the adoption of the guidelines or five years after first election as a director, whichever is later, but are expected to accumulate the required number of shares ratably over the applicable five-year period. Under the guidelines, nonemployee directors are required to own common stock of the Company having a value equal to four times the annual cash director fee. As of March 3, 2014, all directors were in compliance with the stock ownership guidelines. The Governance Committee of the Board will monitor compliance with the guidelines and may recommend modifications or exceptions to the Board.
The following table summarizes the cash and equity compensation for nonemployee directors for the year ended December 31, 2010:
Director Compensation for 20102013
Fees Earned | ||||||||||||||||
Name | or Paid in Cash | Stock Awards(1)(2) | Option Awards(1)(2) | Total | ||||||||||||
James R. Clark | $ | 28,000 | $ | 70,212 | $ | 101,580 | $ | 199,792 | ||||||||
C. Sean Day | 47,000 | 70,212 | 101,580 | 218,792 | ||||||||||||
Bob G. Gower | 67,750 | 41,328 | 131,142 | 240,220 | ||||||||||||
William M. Lamont, Jr. | 71,000 | 41,328 | 101,580 | 213,908 | ||||||||||||
C. Berdon Lawrence | 24,250 | 41,328 | 101,580 | 167,158 | ||||||||||||
David L. Lemmon | 58,000 | 41,328 | 101,580 | 200,908 | ||||||||||||
Monte J. Miller | 25,000 | 70,212 | 101,580 | 196,792 | ||||||||||||
George A. Peterkin, Jr. | 34,000 | 41,328 | 131,142 | 206,470 | ||||||||||||
Richard R. Stewart | 58,000 | 41,328 | 101,580 | 200,908 |
Name | Fees Earned or Paid in Cash | Stock Awards(1)(2) | Option Awards(1)(2) | Total | ||||||||||||
Richard J. Alario | $ | 30,250 | $ | 104,700 | $ | 167,340 | $ | 302,290 | ||||||||
C. Sean Day | 49,250 | 104,700 | 167,340 | 321,290 | ||||||||||||
Bob G. Gower | 71,250 | 104,700 | 167,340 | 343,290 | ||||||||||||
William M. Lamont, Jr. | 73,250 | 75,648 | 167,340 | 316,238 | ||||||||||||
David L. Lemmon | 54,250 | 75,648 | 167,340 | 297,238 | ||||||||||||
Monte J. Miller | 39,250 | 104,700 | 167,340 | 311,290 | ||||||||||||
George A. Peterkin, Jr. | 6,250 | 75,648 | 194,064 | 275,962 | ||||||||||||
Richard R. Stewart | 54,250 | 75,648 | 167,340 | 297,238 | ||||||||||||
William M. Waterman | 30,250 | 75,648 | 167,340 | 273,238 |
(1) | The amounts included in the “Stock Awards” and “Option Awards” columns represent the grant date fair value related to restricted stock awards and option grants to the directors, computed in accordance with FASB ASC Topic 718. For a discussion of valuation assumptions, see Note | |
(2) | Each director was granted 1,000 shares of restricted stock on April |
9
The following table shows the aggregate number of shares of unvested restricted stock and stock options outstanding for each director as of December 31, 2013, as well as the grant date fair value of restricted stock and stock option grants made during 2013:
Name | Aggregate Shares of Unvested Restricted Stock as of December 31, 2013 | Aggregate Stock Options Outstanding as of December 31, 2013 | Grant Date Fair Value of Restricted Stock and Stock Options Awarded during 2013 | |||||||||
Richard J. Alario | 96 | 23,153 | $ | 272,040 | ||||||||
C. Sean Day | 96 | 30,000 | 272,040 | |||||||||
Bob G. Gower | 96 | — | 272,040 | |||||||||
William M. Lamont, Jr. | — | 60,000 | 242,988 | |||||||||
David L. Lemmon | — | 30,000 | 242,988 | |||||||||
Monte J. Miller | 96 | 61,264 | 272,040 | |||||||||
George A. Peterkin, Jr. | — | 65,905 | 269,712 | |||||||||
Richard R. Stewart | — | 34,000 | 242,988 | |||||||||
William M. Waterman | — | 16,000 | 242,988 |
Aggregate Shares | Aggregate | Grant Date | ||||||||||
of Restricted Stock | Stock Options | Fair Value of | ||||||||||
Outstanding | Outstanding | Restricted Stock and | ||||||||||
as of | as of | Stock Options | ||||||||||
Name | December 31, 2010 | December 31, 2010 | Awarded during 2010 | |||||||||
James R. Clark | 175 | 28,000 | $ | 171,792 | ||||||||
C. Sean Day | 175 | 42,000 | 171,792 | |||||||||
Bob G. Gower | — | 35,477 | 172,470 | |||||||||
William M. Lamont, Jr. | — | 60,000 | 142,908 | |||||||||
C. Berdon Lawrence | — | 6,000 | 142,908 | |||||||||
David L. Lemmon | — | 40,000 | 142,908 | |||||||||
Monte J. Miller | 175 | 41,988 | 171,792 | |||||||||
George A. Peterkin, Jr. | — | 74,964 | 172,470 | |||||||||
Richard R. Stewart | — | 28,000 | 142,908 |
The Board has no set policy concerning the separation of the offices of Chairman of the Board and Chief Executive Officer, but retains the flexibility to decide how the two positions should be filled based on the circumstances existing at any given time. The roles of Chairman of the Board and Chief Executive Officer of the Company were separated for many years, with Mr. Lawrence serving as Chairman of the Board and Mr. Pyne serving as President and Chief Executive Officer from 1999 until Mr. Lawrence’s retirement as Chairman in April 2010. The Board has placed considerable emphasis on management succession planning and decided that, upon Mr. Lawrence’s retirement, the election of Mr. Pyne as Chairman of the Board in addition to Chief Executive Officer would best serve the Company’s needs and the succession process. In light of the economic conditions of the last fewduring recent years and the prospect of significant acquisition opportunities foracquisitions completed by the Company during 20102011 and 2011,2012 and the challenge of integrating these acquisitions with the Company’s operations, the Board consideredconsiders it important to continue to have someone in the role of Chairman of the Board with a comprehensive understanding of, as well as primary responsibility for, the Company’s businesses and strategic direction.
The Board does not have a “lead director,” but has chosen Mr. Gower to be the “presiding director” to preside at the regular executive sessions of the non-management directors that are held at least quarterly. Mr. Gower also serves as a liaison between the independent directors and management on certain matters that are not within the area of responsibility of a particular committee of the Board.
Risk Oversight
The Board carries out its risk oversight function primarily through the Audit Committee.Committee and the full Board. Management prepares and reviews with the Audit Committee annuallyand the Board semiannually a comprehensive assessment of the identified internal and external risks of the Company that includes evaluations of the potential impact of each identified risk, its probability of occurrence and the effectiveness of the controls that are in place to mitigate the risk. The Audit Committee then brings to the attention of the Board any issues that warrant further discussion or action. The Audit Committee and the Board also receive regular reports of any events or circumstances involving risks outside the normal course of business of the Company. At times, a particular risk will be monitored and evaluated by another Board committee with primary responsibility in the area involved, such as the Compensation Committee’s review of the risks related to the Company’s compensation policies and practices. The Board’s administration of its risk oversight function has not affected the Board’s leadership structure.
TRANSACTIONS WITH RELATED PERSONS
The Board has adopted a written policy on transactions with related persons that provides that certain transactions involving the Company and any of its directors, executive officers or major stockholders or members of their immediate families, including all transactions that would be required to be disclosed as transactions with
10
related persons in the Company’s Proxy Statement, are subject to approval in advance by the Governance Committee, except that a member of the Committee will not participate in the review of a transaction in which that member has an interest. The Committee has the discretion to approve any transaction which it determines is in,
10
Mr. Alario, a director of the Company, and its subsidiaries paid L3 Partners, LLC (“L3P”), a company owned by Mr. Lawrence,is the former Chairman of the Board, President and current directorChief Executive Officer of Key Energy. Key Energy paid the Company $259,000$1,973,000 in 2013 for air transportation services provided by L3Poilfield service equipment and office relocation costs. Such services werefor parts and service in the ordinary course of business of the Company.
The Company is a 50% owner of The Hollywood Camp, L.L.C. (“The Hollywood Camp”), a company that owns and operates a hunting and fishing facility used by the Company and L3P, which is also a 50% owner. The Company uses The Hollywood Camp primarily for customer entertainment. L3P acts as manager of The Hollywood Camp. The Hollywood Camp allocates lease and lodging expenses to its members based on their usage of the facilities. During 2010, the CompanyKey Energy paid $1,558,000 to The Hollywood Camp $1,112,000 for its shareuse of the facility expenses.
Mr. LawrenceWaterman is the Chairmanformer President and owner (together with family members) of Penn but resigned as an officer and director of Penn and affiliated companies contemporaneously with the closing of the Board, Chief Executive Officer2012 acquisition of Penn by the Company and ownerno longer has any ownership interest in or position with Penn or any of 70%its affiliated companies. A portion of the commonpurchase price for the acquisition consisting of approximately $24,000,000 in cash and 83,825 shares of Company stock is held in escrow to secure the sellers’ indemnification of Bayou City Pump, Inc. (“Bayou City”). In 2010, the Company paid Bayou City $200,000 for overhaulsbreaches of black oil barge pumps. Such overhauls wererepresentations and warranties in the ordinary coursepurchase agreement. Except to the extent of business ofpending claims, if any, the Company.
The husband of Amy D. Husted, Vice President — Legal of the Company, is a partner in the law firm of Strasburger & Price, LLP. In 2010, theThe Company paid the law firm $412,000$851,000 in 2013 for legal services in connection with matters in the ordinary course of businessservices. Mr. Pyne approves each engagement of the firm by the Company and the payment of fees billed by the firm.
Wayne G. Strahan, the brother of D. Lynn Strahan, the President of one of the Company’s two principal diesel engine services subsidiaries, is the Service Manager of the Company’s diesel engine services facility in Tampa, Florida. In 2013, Wayne G. Strahan received compensation of $142,363 from the Company.
CORPORATE GOVERNANCE
Business Ethics Guidelines
The Board has adopted Business Ethics Guidelines that apply to all directors, officers and employees of the Company. A copy of the Business Ethics Guidelines is available on the Company’s web site at www.kirbycorp.com in the Investor Relations section under Corporate Governance. The Company is required to make prompt disclosure of any amendment to or waiver of any provision of its Business Ethics Guidelines that applies to any director or executive officer or to its chief executive officer, chief financial officer, chief accounting officer or controller, or persons performing similar functions. The Company will make any such disclosure that may be necessary by posting the disclosure on its web site at www.kirbycorp.com in the Investor Relations section under Corporate Governance.
Corporate Governance Guidelines
The Board has adopted Corporate Governance Guidelines. A copy of the guidelines is available on the Company’s web site at www.kirbycorp.com in the Investor Relations section under Corporate Governance.
11
Communication with Directors
Interested parties may communicate with the full Board or any individual directors, including the Chairmen of the Audit, Compensation and Governance Committees, the presiding director or the non-management or
11
Web Site Disclosures
The following documents and information are available on the Company’s web site at www.kirbycorp.com in the Investor Relations section under Corporate Governance:
Audit Committee Charter
Compensation Committee Charter
Criteria for the Selection of Directors
Business Ethics Guidelines
Corporate Governance Guidelines
Communication with Directors
12
BENEFICIAL OWNERSHIP OF COMMON STOCK
Beneficial Ownership of Directors and Executive Officers
The following table shows the number of shares of common stock beneficially owned by each director, each named executive officer listed in the Summary Compensation Table, and by the directors and executive officers of the Company as a group as of March 1, 2011.3, 2014. Under rules of the SEC, “beneficial ownership” is deemed to include shares for which the individual, directly or indirectly, has or shares voting or investment power, whether or not they are held for the individual’s benefit. Except as otherwise indicated, the persons named have sole voting and investment power over the shares shown.
Shares of Common Stock | ||||||||||||||||||||
Beneficially Owned on March 1, 2011 | Percent of | |||||||||||||||||||
Right to | Common | |||||||||||||||||||
Direct(1) | Indirect | Acquire(2) | Total | Stock(3) | ||||||||||||||||
DIRECTORS | ||||||||||||||||||||
James R. Clark | 3,699 | — | 28,000 | 31,699 | ||||||||||||||||
C. Sean Day | 21,123 | — | 42,000 | 63,123 | ||||||||||||||||
Bob G. Gower | 42,922 | — | 35,477 | 78,399 | ||||||||||||||||
William M. Lamont, Jr. | 40,284 | (4) | — | 60,000 | 100,284 | |||||||||||||||
C. Berdon Lawrence | 315,171 | 34,227 | (5) | 206,000 | (6) | 555,398 | 1.0 | % | ||||||||||||
David L. Lemmon | 5,000 | — | 40,000 | 45,000 | ||||||||||||||||
Monte J. Miller | 7,973 | — | 41,988 | 49,961 | ||||||||||||||||
George A. Peterkin, Jr. | 205,344 | (7) | 63,040 | (8) | 61,608 | 329,992 | ||||||||||||||
Joseph H. Pyne | 421,633 | — | 143,607 | 565,240 | 1.1 | % | ||||||||||||||
Richard R. Stewart | 3,000 | — | 28,000 | 31,000 | ||||||||||||||||
NAMED EXECUTIVES | ||||||||||||||||||||
Gregory R. Binion | 50,731 | — | 37,962 | 88,693 | ||||||||||||||||
David W. Grzebinski | 46,554 | — | 2,970 | 49,524 | ||||||||||||||||
Dorman L. Strahan | 44,835 | — | 14,654 | 59,489 | ||||||||||||||||
Amy D. Husted | 17,818 | (9) | — | 4,833 | 22,651 | |||||||||||||||
Directors and Executive Officers as a group (19 in number) | 1,286,953 | 97,267 | 767,098 | 2,151,318 | 4.0 | % |
12
Shares of Common Stock Beneficially Owned on March 3, 2014 | Percent of Common Stock(3) | |||||||||||||||||||
Direct(1) | Indirect | Right to Acquire(2) | Total | |||||||||||||||||
DIRECTORS | ||||||||||||||||||||
Richard J. Alario | 2,863 | — | 23,153 | 26,016 | ||||||||||||||||
C. Sean Day | 40,479 | — | 30,000 | 70,479 | ||||||||||||||||
Bob G. Gower | 33,767 | — | — | 33,767 | ||||||||||||||||
William M. Lamont, Jr. | 61,284 | (4) | — | 60,000 | 121,284 | |||||||||||||||
David L. Lemmon | 8,000 | — | 18,000 | 26,000 | ||||||||||||||||
Monte J. Miller | 4,020 | — | 61,264 | 65,284 | ||||||||||||||||
George A. Peterkin, Jr. | 141,093 | (5) | 72,320 | (6) | 65,905 | 279,318 | ||||||||||||||
Joseph H. Pyne | 216,531 | — | 101,299 | 317,830 | ||||||||||||||||
Richard R. Stewart | 9,000 | — | 18,000 | 27,000 | ||||||||||||||||
William M. Waterman | 151,001 | (8) | 349,999 | (7)(8) | 16,000 | 517,000 | ||||||||||||||
NAMED EXECUTIVES | ||||||||||||||||||||
Gregory R. Binion(9) | 11,712 | — | — | 11,712 | ||||||||||||||||
David W. Grzebinski | 36,143 | — | 23,429 | 59,572 | ||||||||||||||||
William G. Ivey | 24,773 | — | 17,695 | 42,468 | ||||||||||||||||
James F. Farley | 31,369 | — | 6,173 | 37,542 | ||||||||||||||||
Directors and Executive Officers as a group | 922,033 | 424,058 | 502,004 | 1,848,095 | 3.2 | % |
(1) | Shares owned as of March | |
(2) | Shares with respect to which a director or executive officer has the right to acquire beneficial ownership within 60 days after March | |
(3) | No percent of class is shown for holdings of less than 1%. | |
(4) | Does not include | |
(5) | ||
Does not include 8,000 shares owned by Mr. Peterkin’s wife. Mr. Peterkin disclaims beneficial ownership of those shares. |
(6) | Shares owned by trusts of which Mr. Peterkin is trustee, the beneficiaries of which are relatives of his or his wife’s. Mr. Peterkin disclaims beneficial ownership of those shares. |
(7) | Shares are held by a grantor retained annuity trust for the benefit of Mr. Waterman and, following the expiration of the two-year annuity term, for the benefit of Mr. Waterman’s wife and Mr. Waterman’s two adult children. |
(9) | Mr. Binion resigned as an executive officer of the Company effective February 15, 2014. His stock ownership |
13
Principal Stockholders
The following table and notes set forth information as of the dates indicated concerning persons known to the Company to be the beneficial owner of more than 5% of the Company’s outstanding common stock, based on filings with the SEC:
Number of Shares | Percent | |||||||
Name and Address | Beneficially Owned | of Class(1) | ||||||
Janus Capital Management, LLC 151 Detroit Street Denver, Colorado 80206 | 3,631,404 | (2) | 6.77 | % | ||||
Royce & Associates, LLC 745 Fifth Avenue New York, New York 10151 | 3,258,429 | (3) | 6.07 | % | ||||
Araltec, S.L. Calle Santisima Trinidad, 2 Madrid, Spain 28010 | 2,990,190 | (4) | 5.57 | % | ||||
PRIMECAP Management Company 225 South Lake Avenue, Suite 400 Pasadena, California 91101 | 2,987,604 | (5) | 5.57 | % | ||||
BlackRock, Inc. 40 East 52nd Street New York, New York 10022 | 2,710,078 | (6) | 5.05 | % |
Name and Address | Number of Shares Beneficially Owned | Percent of Class(1) | ||||||
BlackRock, Inc. 40 East 52nd Street New York, NY 10022 | 3,750,022 | (2) | 6.6 | % | ||||
Select Equity Group, L.P., Select Equity Group, Inc and 380 Lafayette Street, 6th Floor New York, NY 10003 |
| 3,411,367 | (3) |
| 6.0 | % | ||
Atlanta Capital Investment Managers 1075 Peachtree Street NE, Suite 2100 Atlanta, GA 30309 | 3,099,264 | (4) | 5.4 | % | ||||
The Vanguard Group. 100 Vanguard Blvd Malvern, PA 19355 | 3,042,207 | (5) | 5.3 | % | ||||
Araltec, S.L. Calle Santisima Trinidad, 2 Madrid, Spain 28010 | 2,990,190 | (6) | 5.3 | % |
(1) | Based on the Company’s outstanding shares of common stock on March | |
(2) | Based on Schedule 13G, dated January 17, 2014, filed by BlackRock, Inc. with the SEC. |
(3) | Based on Schedule 13G, dated February 14, |
(4) | Based on Schedule 13G, dated January |
(5) | Based on Schedule 13G, dated February 6, 2014, filed by The Vanguard Group with the SEC. |
(6) | Based on Schedule 13G, dated December 23, 2009, filed by Araltec, S.L. with the SEC. | |
13
The Company’s directors and executive officers, and persons who own beneficially more than 10% of the Company’s common stock, are required under Section 16(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) to file reports of beneficial ownership and changes in beneficial ownership of the Company’s common stock with the SEC and the NYSE. Based solely on a review of the copies of reports furnished to the Company and written representations that no other reports were required, the Company believes that its executive officers and directors complied with all Section 16(a) filing requirements during 2010,2013, except that two reportsthe report covering giftsa sale of 1,3502,300 shares by Mr. Peterkin in 2007 and 2009 were reported in December 2010.
14
EXECUTIVE COMPENSATION
Compensation Discussion and Analysis
Executive Summary
Named Executive Officers
The Company’s “named executive officers” for 2013 and their positions with the Company at the end of 2013 were Joseph H. Pyne, Chairman of the Board, President and Chief Executive Officer, David W. Grzebinski, Executive Vice President and Chief Financial Officer, and the three other most highly compensated executive officers for 2013, consisting of Gregory R. Binion, President-Marine Transportation Group, William G. Ivey, President of the Company’s principal inland marine transportation subsidiary, and James F. Farley, President of the Company’s principal offshore marine transportation subsidiary. Mr. Grzebinski was elected President and Chief Operating Officer effective January 1, 2014. Mr. Binion resigned as an executive officer of the Company effective February 15, 2014. Compensation of the named executive officers is provided primarily by three compensation elements: (1) base salary, (2) annual incentive compensation and (3) long-term incentives, including stock options, restricted stock and performance awards. The overall goal of the Company’s compensation program is to pay compensation competitive with similar corporations and to tie annual incentives and long-term incentives to corporate performance and a return to the Company’s stockholders.
Compensation Objectives
The objectives of the compensation program are:
to attract and retain senior executives with competitive compensation opportunities;
to achieve consistent performance over time; and
to achieve performance that results in increased profitability and stockholder value.
The Company’s executive compensation program is designed to reward:
performance that contributes to the long-term growth and stability of the Company and the effectiveness of management in carrying out strategic objectives identified for the Company (through the base salary);
the financial and operational success of the Company for the current year (through the annual incentive plan); and
the future growth and profitability of the Company (through long-term incentive compensation awards).
Chief Executive Officer Compensation and Company Performance in 2013
Mr. Pyne’s salary increased from $772,500 to $827,500 in 2013 (an increase of 7.1% over 2012). He earned cash incentive compensation payments of $2,679,355 (an increase of 14.8% from 2012) and received equity compensation awards with a grant date fair value of $2,138,652 (an increase of 15.4% over 2012). A total of 61% of his direct compensation (annual bonus, three-year performance award and stock options) was performance-based.
15
The Company achieved strong financial results in 2013. The following table summarizes a number of key financial measures for 2012 and 2013 (dollars in millions except per share amounts):
2012 | 2013 | Increase | ||||||||||
Total assets | $ | 3,653 | $ | 3,683 | 1 | % | ||||||
Total revenues | $ | 2,113 | $ | 2,242 | 6 | % | ||||||
Net earnings attributable to Kirby | $ | 209 | $ | 253 | 21 | % | ||||||
EBITDA(1) | $ | 507 | $ | 598 | 18 | % | ||||||
Earnings per share (diluted)(1) | $ | 3.73 | $ | 4.44 | 19 | % | ||||||
Return on total capital(1) | 15.2 | % | 15.4 | % | 1 | % |
(1) | Performance measures for annual and long-term incentive compensation discussed under “Elements of Compensation — Annual Incentive Compensation” below. |
The Company’s total stockholder return was 60% for the last year and 125% for the last three years. During 2013, the Company substantially completed the integration of its major 2012 marine transportation acquisitions into its existing inland and coastal operations and continued to make progress in changing the primary focus of the land-based diesel engine business acquired in 2011 from manufacturing to a more stable and predictable remanufacturing and service operation.
Compensation Committee
The Compensation Committee (the “Committee”) of the Board of Directors of the Company has the authority and responsibility to (1) determine the salaries for executive officers of the Company, (2) administer the Company’s annual incentive compensation program, (3) administer all of the Company’s stock option and incentive compensation plans and grant stock options, restricted stock and other awards under the plans (except those plans under which grants are automatic) and (4) review and make recommendations to the Board of Directors with respect to incentive and equity-based compensation plans and any other forms of compensation for executive officers of the Company. The Compensation Committee is composed of four members, all of whom are “independent directors,” “Non-Employee Directors” and “outside directors” as those terms are defined in relevant New York Stock ExchangeNYSE standards and federal securities and tax regulations.
The Committee does not delegate any of its authority to determine executive compensation. The Committee considers recommendations from the Chief Executive Officer in making its compensation decisions for executive officers other than the Chief Executive Officer. The Committee will usually but not always, follow those recommendations inwhen setting compensation for other executive officers since the Chief Executive Officer is in the best position to evaluate the contributions of the other executive officers to the success of the Company. The Committee undertakes a more thoroughan independent evaluation of the individual performance of the Chief Executive Officer prior to setting his compensation than it does for the other executive officers.compensation. The Committee also engaged a compensation consultant in connection with its compensation decisions for 2010.
14
16
Company or its business groups, individual performance of the named executive officer, any increased responsibilities assigned to a particular executive officer, the recommendations of the Chief Executive Officer (except as to his own
15
Say on Pay
At the Company’s 2013 Annual Meeting, stockholders approved the compensation of the Company’s named executive officers by 94% of the votes cast. Although the Company interpreted the vote as an endorsement of its executive compensation policies and practices, the Compensation Committee continues to reevaluate the principal elements of the Company’s executive compensation on an ongoing basis, although no material changes were made for 2013.
Compensation Consultant
For 2013, the Compensation Committee engaged the Consultant to provide information for the Committee to consider in making compensation decisions. The Consultant was engaged directly by the Compensation Committee to:
review the reference group of comparable companies used for comparisons of Company performance and executive compensation;
perform a marketplace analysis of direct compensation for senior executive officers compared to the reference group of companies and published compensation surveys;
update the Committee on current issues in executive compensation;
consult with the Committee concerning risks of the Company’s compensation policies and practices;
consult with the Committee concerning the evaluation of executive compensation by proxy advisory firms; and
analyze compensation considerations relating to the Company’s succession plan for the positions of Chief Executive Officer and Chief Financial Officer.
At the Compensation Committee’s request, the Consultant has addressed the six independence factors for compensation committee advisers that were identified in a recently adopted SEC regulation. The Committee concluded that there are no conflicts of interest that affect the work of the Consultant for the Committee. The Consultant was not retained by the Company or any of its affiliates (other than the Compensation Committee) to perform any services during 2013.
Elements of Compensation
Reference Group
Compensation information for a reference group of comparable companies used by the Compensation Committee in making compensation decisions was provided by the Consultant. See “Benchmarking” below for more detail and a listing of the companies in the reference group.
Salary
The Compensation Committee attempts to set base salaries for the named executive officers at approximately the median for comparable companies. The Committee and management believe that the Company is thea leader in its industrythe industries in which it operates and that its employees are frequently targeted by its competitors. Therefore the Committee generally attempts to set compensation at levels to keep pace with inflation and the competitive market to avoid losing valuable employees.
Based on information available in October 2009,January 2013, the Consultant determined that the Company’s salaries for its topnamed executive officers averaged approximately 98%93% of the median for the reference group. In settinggroup and that salaries for all of the five named executive officers were below the market median for comparable positions. Salary
17
increases for those five executive officers for 2013 ranged from 3% to 10%, depending on the amount of the increase necessary to bring them closer to the market median. The Committee determined that the increases were warranted by the performance of the executives and the Company and were consistent with the Company’s overall salary budget for 2010, management and the Compensation Committee considered the Company’s performance in 2009 on financial, operational and strategic levels, as well as independent survey information from sources other than the Consultant that projected 2.5-3.0% increases in salary budgets for 2010 for all categories of employees at a broad range of companies. Because of the deteriorating business conditions at the beginning of 2009 and the Company’s ongoing effort to reduce expenses, the Company instead increased the salary budget for shore staff by 2.5% over 2009. Salaries of executive officers generally increased in the 2.0-3.5% range, except that there was no increase in the salary of the Chief Executive Officer and except that the salaries of two officers, including Mr. Binion, were increased bycompensation philosophy.
13-15% because the Committee determined, with input from the Consultant, that their salaries were significantly below the norm for comparable positions.
With regard to the annual cash incentives for executive officers, the Compensation Committee attempts to set annual incentive compensation targets at a level such that, with a positivetarget performance by an executive officer and the Company, the total cash compensation (base salary plus annual incentive bonus) for the executive officer will be at approximately the median for comparable companies and positions, but with a certain level ofsuperior performance by an executive officer and the Company, the total cash compensation for the executive officer will be above the median total cash compensation for similar corporations and positions.median. Based on the market analysis provided to the Committee by the Consultant, the Committee determined that the 20102013 salaries for the executive officers would be within or below the median range and that the target total cash compensation including incentive compensation, would fall betweenbe within the median range and could reach a range around the 75th75th percentile with strong company performance, which is consistent with the Company’s compensation philosophy. ActualWith the Company’s strong performance in 2013, actual total cash compensation was between the 50th and 75th percentiles for 2010 was at approximatelythree of the 75th percentile.five named executive officers, including the Chief Executive Officer, and slightly above the 75th percentile for the other named executive officers. The Compensation Committee believes that total annual cash compensation above the median for similar corporations and positions is appropriate since a significant portion of each executive officer’s total annual cash compensation is at risk due to both individual performance factors and the Company’s success in achieving the targeted performance measures described in the next paragraph. The annual incentive compensation constitutes a significant portion of direct cash compensation and can vary significantly from year to year depending on the Company’s achievement of those performance measures.
Bonuses paid under the Company’s annual incentive plan are intended to qualify as performance-based compensation for 2010purposes of Section 162(m) of the Internal Revenue Code of 1986, as amended. For 2013, the performance goal required in order for any participants in the plan to receive a bonus was the achievement by the Company of net earnings greater than $1,000,000. Target annual incentive compensation expressed as a percentage of a participant’s base salary was established for each participant in the plan and a recommended bonus was determined for each participant based on the achievement ofextent to which three additional equally weighted performance measures were achieved by each of the Company’s three business groups — inland marine transportation, diesel engine services and offshore marine transportation — and by the Company as a whole. The aggregate amount of the bonus pool for the year was equal to the sum of the recommended bonuses so determined for all participants. The recommended bonus for each participant serves as a guideline for the individual awards, but each individual bonus may be above or below that level. However, in no event will a bonus paid to any participant exceed 200% of the target bonus for that participant. The Compensation Committee may decrease (but not increase) the bonus paid to any participant below that maximum amount based on such quantitative or qualitative criteria as the Compensation Committee determines to be appropriate.
The three additional performance measures are EBITDA, (net earnings attributable to Kirby, before interest expense, taxes on income, depreciation and amortization), return on total capital and earnings per share. EBITDA for the year is calculated by adding the following amounts shown in the Company’s audited financial statements: (1) net earnings attributable to Kirby, (2) depreciation and amortization, (3) interest expense and (4) provision for taxes on income. Return on total capital for the year is calculated by dividing (i) net earnings attributable to Kirby plus provision for taxes on income plus interest expense by (ii) the average of total equity plus long-term debt for the year.
Performance under the annual incentive plan is measured on a calendar year basis. At the beginning of eachthe year, the Committee established the sole performance goal under the plan of net earnings greater than $1,000,000. The Committee also established objectives are established for each of the three additional performance measures for the year, based on the budget for the year that is prepared by management and approved by the Board.
16
18
Target | Actual | |||
EBITDA | $271 million | $295 million | ||
Return on total capital | 13.3% | 15.3% | ||
Earnings per share | $1.84 | $2.15 |
Target | Actual | |||
EBITDA | $579 million | $598 million | ||
Return on total capital | 14.2% | 15.4% | ||
Earnings per share | $4.11 | $4.44 |
In administeringaddition to the target bonus established for each participant in the annual incentive plan, the Compensation Committee establishes a target amount expressed as a percentage of base salary for each participant. The Committee also establishesestablished a range of possible incentive compensation payments, with no payment earned unless at least 80% of the target performance is achieved and a maximum possible award of 200% of the target amount if 120% of the target performance is achieved. Annual incentive compensation payments for employees of the Company itself (a holding company which conducts operations through its subsidiaries) are based entirely on the performance of the Company as a whole. Payments for the heads of the Company’s business groups are based 50% on the performance of the business group and 50% on overall Company performance. Payments for all other employees in a business group are based 70% on the performance of the business group and 30% on overall Company performance.
For 2010,2013, the Compensation Committee set the target annual incentive compensation for the named executive officers at the following percentages of base salary: Joseph H. Pyne (90%(105%), Gregory R. Binion (70%), David W. Grzebinski (70%), Gregory R. Binion (70%), Dorman L. StrahanWilliam G. Ivey (70%) and Amy D. Husted (40%James F. Farley (70%). InThe target percentages, which were unchanged from 2012, were set at levels which the cases of Mr. Pyne and Mr. Strahan, the target amounts as a percentage of base salary were established at their current levels in 2000,Committee determined, based on the recommendation of a different executive compensation consulting firm that advised the Company on the design of the plan. Since then, the Committee has generally been satisfied that the annual incentive compensation awards producedanalysis by the plan have been reasonable in amount and have correlated with the performance of the Company and its business groups and has therefore not changed the target percentages for those two executive officers. Mr. Binion and Ms. Husted have been promoted to their current positions since the plan was originally implemented and the target percentages for them have increased over time to levels thatConsultant, are commensurate with their increased responsibilities, and consistent with target percentages for other officers of the Company. Mr. Grzebinski was hired in 2010Company’s executive compensation philosophy, internally equitable and his target percentage was set at a level that was determined to be competitive for executives with his qualifications.their qualifications and experience. Payouts under the annual incentive plan for 20102013 were 166.6%133.8% of the target amount for Mr. Pyne, Mr. GrzebinskiBinion and Ms. HustedMr. Grzebinski (employees of the parent Company), 167.7%130.8% of the target amount for Mr. Binion,Ivey, the President of the Company’s principal inland marine transportation subsidiary, and 137.8%146.4% of the target amount for Mr. Strahan,Farley, the President of the Company’s diesel engine services subsidiaries.
The Compensation Committee awarded the fullrecommended bonus calculated under the plan, payment for 2010without adjustment, to each named executive officer for 2013 after determining that the performance of each of the officers met expectations for the year. That determination for the Chief Executive Officer was based on the performance evaluation of the Chief Executive Officer conducted by the Board of Directors under the guidance of the Governance Committee and on the extent of the Company’s achievement of most of its financial, operational and strategic goals for 2010.2013. The determination for the other named executive officers was based primarily on evaluations and recommendations made by the Chief Executive Officer, as well as on the Board’s interaction with the other named executive officers during the previous year in relation to matters in their areas of responsibility.
Long-Term Incentive Compensation
The Compensation Committee’s objective for long-term incentive compensation for executive officers is generally to fall between the 50th and 75th percentiles (depending on performance) in long-term incentive compensation of similar corporations and positions. In addition to retirement, health care and similar benefits, theThe primary long-term incentives for executive officers are stock options, restricted stock and cash performance awards. The Committee views stock option and restricted stock awards as a regular component of compensation for executive officers, as well as for managerial level employees generally, because the Committee believes that such awards provide an incentive for key employees to remain with the Company. Incentive compensation underCompany and focus on the Company’s annual incentive plan varies with the Company’s achievementlong-term performance of the annual performance targets.Company. The long-term incentive compensation therefore
17
19
performance, as well as business group and individual performance. In addition, the ultimate value of the options and shares of restricted stock granted depends on the Company’s stock price, aligning the interests of recipients of those awards with the interests of the Company’s stockholders.
In 2010,2013, the Compensation Committee granted nonqualified stock options covering 69,59961,669 shares of common stock and 99,66938,500 shares of restricted stock to the named executive officers. Those numbers include options and shares granted under the long-term incentive compensation program discussed below and the special restricted stock grant to Mr. Grzebinski described under “New Chief Financial Officer” below. The options were granted at a price equal to the fair market value of the Company’s common stock on the date of grant, vest in equal increments over three years and have a term of seven years. The restricted stock vests in equal increments over five years. In deciding on the number of options and shares of restricted stock to award to executive officers other than the four named in the discussion of the long-term incentive compensation program below, the Committee considered the performance of the Company, the performance of the officer, information from the Consultant about the level of long-term equity-based incentive compensation awards made by comparable companies, the Company’s option overhang (considering both outstanding options and shares remaining available to be granted under the Company’s plans) and recommendations from the Chief Executive Officer. Those factors are not weighted in any specific manner and the resulting awards are therefore to some extent subjective.
The Company maintains a long-term incentive compensation program for selected senior executives that is administered by the Compensation Committee. The program allows the grant of incentive stock options, nonincentive stock options, restricted stock, performance shares and performance units (or any combination thereof). The objective of the program is to provide long-term incentive compensation to the specified executives in an amount that falls between the 50th and 75th percentiles (depending on performance) when compared to companies or business units of similar size. For 2013, the grant date value of long-term incentive compensation awards to the named executive officers ranged from 73% to 92% of the market median when they were made at the beginning of the year. The actual value realized will be based on the Company’s performance over a period of approximately 3-7 years.
Under the program, the elements of long-term compensation to be awarded, as well as the executives selected to participate, are determined each year by the Compensation Committee.
Stock | Restricted | Performance | ||||||||||||||
Options | Stock | Awards | Total | |||||||||||||
Joseph H. Pyne | $ | 600,000 | $ | 1,200,000 | $ | 1,200,000 | $ | 3,000,000 | ||||||||
Gregory R. Binion | 163,000 | 326,000 | 326,000 | 815,000 | ||||||||||||
David W. Grzebinski | 125,000 | 250,000 | 250,000 | 625,000 | ||||||||||||
Dorman L. Strahan | 63,000 | 126,000 | 126,000 | 315,000 |
Stock Options | Restricted Stock | Performance Awards | Total | |||||||||||||
Joseph H. Pyne | $ | 700,000 | $ | 1,400,000 | $ | 1,400,000 | $ | 3,500,000 | ||||||||
Gregory R. Binion | 200,000 | 400,000 | 400,000 | 1,000,000 | ||||||||||||
David W. Grzebinski | 200,000 | 400,000 | 400,000 | 1,000,000 | ||||||||||||
William G. Ivey | 140,000 | 280,000 | 280,000 | 700,000 | ||||||||||||
James F. Farley | 120,000 | 240,000 | 240,000 | 600,000 |
The options vest over a three-year period and the restricted stock vests over a five-year period. The performance awards are based on a three-year performance period beginning January 1, 2010.2013. The percentage of the target award paid at the end of the performance period will be based on the Company’s achievement on a cumulative basis for the three-year period of the objective levels of EBITDA, return on total capital and earnings per share established under its annual incentive plan, with the three factors equally weighted. The officers will be paid the target amount if 100% of the objective performance measures is achieved over the three-year period. The payment can range from zero if less than 80% of the objective performance measures is achieved to a maximum of 200% of the target award for the achievement of 130% or more of the objective performance measures.
The amount and form of the long-term incentive compensation awards, including the specific mix of long-term incentive compensation elements, were based in part on an analysis of market data on the amounts of awards and recommendations on the form of awards provided by the Consultant to the Compensation Committee.
18
20
The Compensation Committee set the 2010 base salary for Joseph H. Pyne, the Company’s Chairman of the Board and Chief Executive Officer, at $680,000, the same as$840,000 effective April 1, 2013, which resulted in a total salary for 2013 of $827,500, a 7.1% increase over his salary for 2009. The Compensation Committee took into account the continuing uncertainty about the state of the economy as well as other elements of compensation awarded to Mr. Pyne in deciding to hold his salary for 2010 at the same level as in 2009.2012. The Chief Executive Officer’s base salary was generally based on the same factors and criteria outlined above, which include compensation paid to chief executives of similar corporations, individual as well as corporate performance and a general correlation with the compensation of other executive officers of the Company. In particular, the analysis by the Consultant indicated that Mr. Pyne’s salary was at 95% of the median for comparable companies prior to the increase. In setting the compensation of Mr. Pyne, the Committee also considersconsidered the Company’s success in achieving the financial, operational and strategic corporate goals established for each year, as well as the annual evaluation of the Chief Executive Officer’s performance conducted by the Board under the guidance of its Governance Committee. However, neither the achievement of corporate goals, the performance evaluation nor any other particular aspect of Company or individual performance is given any specific weighting or tied by any type of formula to decisions on the Chief Executive Officer’s base salary or long-term incentive compensation awards. The $2,446,392$2,679,355 in non-equity incentive plan compensation shown for Mr. Pyne in the Summary Compensation Table consisted of (1) $1,019,592$1,162,555 determined under the annual incentive plan described above and (2) a $1,426,800$1,516,800 payment earned by Mr. Pyne for the2008-2010 2011-2013 performance period under a cash performance award granted as part of the Company’s long-term incentive compensation program that was based on the formula for the performance award that was established by the Compensation Committee when the award was made at the beginning of 2008.
New Chief Financial Officer
The Company maintains two primary retirement plans in which the named executive officers are eligible to participate on the same basis as broad categories of employees — a Profit Sharing Plan and a 401(k) Plan. Most of the Company’s shore-based employees are eligible to participate in the Profit Sharing Plan. The aggregate contributions made to the plan by the Company are allocated among the participants according to base salary. All employees of the Company are eligible to participate in the 401(k) Plan, under which the Company will match employee contributions in an amount up to 3% of an employee’s base salary.
The Company maintains an unfunded, nonqualified Deferred Compensation Plan for Key Employees, which is designed primarily to provide additional benefits to eligible employees to restore benefits to which they would be entitled under the Company’s Profit Sharing Plan and 401(k) Plan were it not for certain limits imposed by the Internal Revenue Code. The plan is designed to restore benefits for employees being compensated in excess of certain limits ($245,000255,000 per annum for 2010)2013). In 2010,2013, the Committee approved contributions for each participant at the maximum amounts allowed by the Plan.
Perquisites and Personal Benefits
The only perquisites or other personal benefits that the Company provides to the named executive officers are an automobile allowance that is given to approximately 65127 executive and management employees and payment of the cost of club memberships that are used for both business and personal purposes and the payment of a portion of the cost of financial planning services provided to two of the named executive officers during 2010.purposes. The Compensation
19
Employment/Severance Agreements
Except for accelerated vesting of outstanding stock options, restricted stock and performance awards upon a change in control of the Company, there are no special compensation arrangements related to severance orchange-in-control events. The Company has no employment agreements with any of its executive officers.
21
Benchmarking
Information used by the Compensation Committee to benchmark against comparable companies in determining particular elements of executive compensation has been provided by the Consultant. Marketplace analysis developed by the Consultant has been based in part on a reference group of 17 companies selected because they are of a similar size to the Company have similar business characteristics (such as levels ofby various measures including revenue and market capitalization, generate comparable returns on assets, equity and capital or people intensity, cyclicality and use of technology) and have primary operations in at least one of the same business segments as the Company. In determining competitive market levels for the elements of executive compensation, the Consultant used a combination of data on the companies in the reference group and data from published compensation surveys.
The reference group used by the Consultant for the information provided to the Committee in connection with its compensation decisions for 20102013 included the following companies:
ABM Industries Incorporated | Oceaneering International, Inc. | ||
Bristow Group Inc. | Oil States International, Inc. | ||
Cameron International Corporation | SEACOR Holdings Inc. | ||
Exterran Holdings, Inc. | Superior Energy Services, Inc. | ||
FMC Technologies, Inc. | Tidewater Inc. | ||
Helix Energy Solutions Group, Inc. | |||
Key Energy Services, Inc. | Waste Connections, Inc. | ||
McDermott International, Inc. | Werner Enterprises, Inc. |
Based on the most recent executive compensation review prepared by the Consultant for the Compensation Committee:
the base salaries of the five named executive officers ranged from 92% to 112% of the median for the reference group;
• | total cash compensation (salary plus annual incentive compensation) fell between the median and the 75th percentile for three of the named executive officers, including the Chief Executive Officer, and slightly above the 75th percentile for the other two named executive officers; |
long-term incentive compensation ranged from 66% to 108% of the median; and
total direct compensation ranged from 90% to 115% of the median.
The Consultant also gathered data on the Company’s financial performance relative to the reference group of comparable companies based on public information. The Company, which is at approximately the median size of the companies in the reference group, ranked above the median for the reference group, and in most cases above the 80th percentile, for both one-year (2012) and three-year (2010-2012) periods on a broad range of financial performance measures, including return on equity, return on assets, return on total capital, revenue and earnings per share growth and total stockholder return. The only exception was the one-year growth in revenue which was below the median, although the three-year revenue growth was at the 95th percentile.
Other Compensation Matters
Compensation Related Risk
With the assistance of the Consultant, the Compensation Committee undertook a review of the Company’s compensation policies and practices and concluded that the Company’s compensation programs do not encourage excessive risk taking and do not present risks that are reasonably likely to have a material adverse effect on the Company.
22
Tax Considerations
Section 162(m) of the Internal Revenue Code generally disallows a tax deduction to public companies for compensation over $1 million paid to the Chief Executive Officer and the three other most highly compensated executive officers other than the Chief Financial Officer. Certain performance-based compensation, however, is specifically exempt from the deduction limit. The Committee does take steps to qualify compensation for deductibility to the extent practical, but may award compensation that is not deductible when such an award would be in the Company’s best interests.
Timing of Compensation Decisions
The Compensation Committee generally makes executive compensation decisions in January of each year. Options have always been granted at an exercise price equal to the fair market value of the Company’s stock on the date of grant. Options granted at the regular January meeting of the Committee, which takes place several days before the Company’s public release of earnings information for the previous year, are granted at an exercise price equal to the fair market value of the Company’s stock on a specified date shortly after the earnings release, in which case the later date is considered the date of grant.
20
Effective January 1, 2009, the Board established stock ownership guidelines for executive officers and directors of the Company and its subsidiaries. Executive officers must be in compliance within five years after the adoption of the guidelines or five years after becoming an executive officer, whichever is later, but are expected to accumulate the required number of shares ratably over the applicable five-year period. Under the guidelines, the Chief Executive Officer is required to own common stock of the Company having a value equal to four times his base salary. For the other named executive officers, the requirement is three times base salary. As of March 3, 2014, all named executive officers still with the Company were in compliance with the stock ownership guidelines.
Hedging
The guidelines doCompany does not addresshave a separate policy on hedging the economic risk of ownership of Company stock, ownership, but the Company’s insider trading policy prohibits employees and directors from engaging in short sales of the Company’s stock or in transactions involving options to buy or sell the Company’s stock (other than stock options granted by the Company). The Governance Committee of the Board will monitor compliance with the guidelines and may recommend modifications or exceptions to the Board.
Compensation Committee Report
The Compensation Committee of the Board of Directors of the Company has reviewed and discussed with management the Compensation Discussion and Analysis in this Proxy Statement. Based on that review and discussion, the Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this Proxy Statement.
COMPENSATION COMMITTEE |
William M. Lamont, Jr.,Chairman C. Sean Day Bob G. Gower Monte J. Miller |
23
Compensation Committee Interlocks and Insider Participation
The members of the Compensation Committee are, and during 20102013 were, Mr. Lamont, Mr. Day, Mr. Gower and Mr. Miller. None of such persons is or has been an officer or employee of the Company or any of its subsidiaries. In 2010,2013, no executive officer of the Company served on the board of directors or compensation committee of another entity, any of whose executive officers served on the Board or Compensation Committee of the Company.
Compensation Tables
Summary Compensation Table
Change in | ||||||||||||||||||||||||||||||||
Pension Value and | ||||||||||||||||||||||||||||||||
Non-Qualified | ||||||||||||||||||||||||||||||||
Non-Equity | Deferred | |||||||||||||||||||||||||||||||
Stock | Option | Incentive Plan | Compensation | All Other | ||||||||||||||||||||||||||||
Name and Principal Position | Salary | Awards(1) | Awards(1) | Compensation(2) | Earnings(3) | Compensation(4) | Total | |||||||||||||||||||||||||
Joseph H. Pyne | 2010 | $ | 680,000 | $ | 1,202,940 | $ | 497,448 | $ | 2,446,392 | $ | 59,596 | $ | 39,860 | $ | 4,926,236 | |||||||||||||||||
Chairman of the Board, President | 2009 | 680,000 | 1,090,680 | 456,516 | 1,899,019 | 28,210 | 156,558 | 4,310,983 | ||||||||||||||||||||||||
and Chief Executive Officer | 2008 | 680,000 | 1,222,380 | 580,716 | 2,563,466 | 33,293 | 149,978 | 5,229,833 | ||||||||||||||||||||||||
David W. Grzebinski(5) | 2010 | 295,096 | 1,426,798 | 102,996 | 344,141 | — | 16,933 | 2,185,964 | ||||||||||||||||||||||||
Executive Vice President | 2009 | — | — | — | — | — | — | — | ||||||||||||||||||||||||
and Chief Financial Officer | 2008 | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Gregory R. Binion | 2010 | 338,750 | 326,820 | 135,144 | 397,659 | 11,468 | 29,587 | 1,239,428 | ||||||||||||||||||||||||
President of Kirby | 2009 | 305,000 | 272,700 | 114,120 | 185,104 | 2,864 | 67,038 | 946,826 | ||||||||||||||||||||||||
Inland Marine, LP | 2008 | 263,750 | 471,000 | 316,980 | 289,761 | 2,696 | 54,673 | 1,398,860 | ||||||||||||||||||||||||
Dorman L. Strahan | 2010 | 254,950 | 126,300 | 52,236 | 350,845 | — | 30,054 | 814,385 | ||||||||||||||||||||||||
President of Kirby | 2009 | 248,800 | 110,880 | 46,404 | 220,864 | — | 56,764 | 683,712 | ||||||||||||||||||||||||
Engine Systems, Inc. | 2008 | 248,800 | 124,320 | 59,040 | 324,775 | — | 70,180 | 827,115 | ||||||||||||||||||||||||
Amy D. Husted | 2010 | 197,500 | 121,020 | 48,312 | 131,614 | 2,321 | 14,497 | 515,264 | ||||||||||||||||||||||||
Vice President — Legal | 2009 | 190,000 | 111,120 | 36,648 | 63,635 | 501 | 42,424 | 444,328 | ||||||||||||||||||||||||
2008 | 167,500 | 67,800 | — | 99,538 | 471 | 37,899 | 373,208 |
21
Name and Principal Position | Salary | Stock Awards(1) | Option Awards(1) | Non-Equity Incentive Plan Compensation(2) | Change in Pension Value and Non-Qualified Deferred Compensation Earnings(3) | All Other Compensation(4) | Total | |||||||||||||||||||||||||
Joseph H. Pyne | 2013 | $ | 827,500 | $ | 1,387,620 | $ | 751,032 | $ | 2,679,355 | $ | (60,234 | ) | $ | 34,209 | $ | 5,619,482 | ||||||||||||||||
Chairman of the Board, | 2012 | 772,500 | 1,204,920 | 648,252 | 2,334,224 | 46,210 | 170,819 | 5,176,925 | ||||||||||||||||||||||||
President and Chief Executive Officer | 2011 | 710,000 | 1,212,600 | 486,792 | 2,817,297 | 77,839 | 162,465 | 5,466,993 | ||||||||||||||||||||||||
Gregory R. Binion | 2013 | 450,000 | 396,480 | 214,560 | 833,534 | (14,421 | ) | 26,544 | 1,906,697 | |||||||||||||||||||||||
President — Marine Transportation | 2012 | 445,000 | 361,500 | 194,472 | 725,391 | 14,553 | 91,693 | 1,832,609 | ||||||||||||||||||||||||
Group | 2011 | 410,000 | 329,400 | 132,228 | 942,001 | 19,257 | 90,506 | 1,923,392 | ||||||||||||||||||||||||
David W. Grzebinski | 2013 | 440,000 | 396,480 | 214,560 | 728,104 | — | 29,621 | 1,808,765 | ||||||||||||||||||||||||
Executive Vice President and Chief Financial Officer | 2012 | 395,000 | 321,300 | 172,872 | 585,103 | — | 80,137 | 1,554,412 | ||||||||||||||||||||||||
2011 | 345,000 | 252,660 | 101,412 | 440,254 | — | 72,435 | 1,211,761 | |||||||||||||||||||||||||
William G. Ivey | 2013 | 352,500 | 277,500 | 150,192 | 322,626 | — | 30,607 | 1,133,425 | ||||||||||||||||||||||||
President of Kirby Inland Marine, LP | 2012 | 342,500 | 271,140 | 145,872 | 232,797 | — | 79,018 | 1,071,327 | ||||||||||||||||||||||||
2011 | 326,800 | 240,720 | 182,880 | 406,277 | — | 77,039 | 1,233,716 | |||||||||||||||||||||||||
James F. Farley | 2013 | 337,500 | 237,900 | 128,736 | 345,752 | — | 22,500 | 1,072,388 | ||||||||||||||||||||||||
President of Kirby Offshore Marine, | 2012 | 326,375 | 234,720 | 143,172 | 233,717 | — | 71,783 | 1,009,767 | ||||||||||||||||||||||||
LLC | 2011 | 315,500 | 240,720 | 170,460 | 379,341 | — | 70,431 | 1,176,452 |
(1) | The amounts included in the “Stock Awards” and “Option Awards” columns represent the grant date fair value related to restricted stock awards and option grants to the named executive officers, computed in accordance with FASB ASC Topic 718. For a discussion of valuation assumptions, see Note | |
(2) | Amounts include payments under the Company’s annual incentive plan and payments pursuant to three-year performance awards. Both the annual incentive plan and the performance awards are described in more detail in the “Compensation Discussion and Analysis” above. | |
(3) | The amounts for Mr. Pyne reflect the aggregate change during | |
(4) | Amounts for |
24
for excess benefit contributions in | ||
Grzebinski, $16,161 to Mr. |
22
All Other | All Other | |||||||||||||||||||||||||||||||||||||||
Stock | Option | Grant Date | ||||||||||||||||||||||||||||||||||||||
Awards: | Awards: | Exercise | Fair Value | |||||||||||||||||||||||||||||||||||||
Estimated Future Payouts | Number of | Number of | Price of | of Stock | ||||||||||||||||||||||||||||||||||||
Under Non-Equity Incentive | Shares of | Securities | Option | and | ||||||||||||||||||||||||||||||||||||
Grant | Plan Awards(1) | Stock or | Underlying | Awards | Option | |||||||||||||||||||||||||||||||||||
Name | Date | Threshold | Target | Maximum | Units(2) | Options(3) | ($/sh)(4) | Awards(5) | ||||||||||||||||||||||||||||||||
Joseph H. Pyne | 01/26/10 | $ | 240,000 | $ | 1,200,000 | $ | 2,400,000 | |||||||||||||||||||||||||||||||||
02/01/10 | 36,855 | $ | 1,202,940 | |||||||||||||||||||||||||||||||||||||
02/01/10 | 41,178 | $ | 32.56 | 497,448 | ||||||||||||||||||||||||||||||||||||
David W. Grzebinski | 01/26/10 | 50,000 | 250,000 | 500,000 | ||||||||||||||||||||||||||||||||||||
02/08/10 | 45,432 | 1,426,798 | ||||||||||||||||||||||||||||||||||||||
02/08/10 | 8,910 | 31.35 | 102,996 | |||||||||||||||||||||||||||||||||||||
Gregory R. Binion | 01/26/10 | 65,200 | 326,000 | 652,000 | ||||||||||||||||||||||||||||||||||||
02/01/10 | 10,012 | 326,820 | ||||||||||||||||||||||||||||||||||||||
02/01/10 | 11,187 | 32.56 | 135,144 | |||||||||||||||||||||||||||||||||||||
Dorman L. Strahan | 01/26/10 | 25,200 | 126,000 | 252,000 | ||||||||||||||||||||||||||||||||||||
02/01/10 | 3,870 | 126,300 | ||||||||||||||||||||||||||||||||||||||
02/01/10 | 4,324 | 32.56 | 52,236 | |||||||||||||||||||||||||||||||||||||
Amy D. Husted | 01/25/10 | 3,500 | 121,020 | |||||||||||||||||||||||||||||||||||||
02/01/10 | 4,000 | 32.56 | 48,312 |
Grant Date |
Estimated Future Payouts | All Other Stock Awards: Number of Shares of Stock or Units(2) | All Other Option Awards: Number of Securities Underlying Options(3) | Exercise Price of Option Awards ($/sh)(4) | Grant Date Fair Value of Stock and Option Awards(5) | |||||||||||||||||||||||||||
Name | Threshold | Target | Maximum | |||||||||||||||||||||||||||||
Joseph H. Pyne | 02/04/13 | $ | 280,000 | $ | 1,400,000 | $ | 2,800,000 | |||||||||||||||||||||||||
02/04/13 | 19,816 | $ | 1,387,620 | |||||||||||||||||||||||||||||
02/04/13 | 31,742 | $ | 70.65 | 751,032 | ||||||||||||||||||||||||||||
Gregory R. Binion | 02/04/13 | 80,000 | 400,000 | 800,000 | ||||||||||||||||||||||||||||
02/04/13 | 5,662 | 396,480 | ||||||||||||||||||||||||||||||
02/04/13 | 9,069 | 70.65 | 214,560 | |||||||||||||||||||||||||||||
David W. Grzebinski | 02/04/13 | 80,000 | 400,000 | 800,000 | ||||||||||||||||||||||||||||
02/04/13 | 5,662 | 396,480 | ||||||||||||||||||||||||||||||
02/04/13 | 9,069 | 70.65 | 214,560 | |||||||||||||||||||||||||||||
William G. Ivey | 02/04/13 | 56,000 | 280,000 | 560,000 | ||||||||||||||||||||||||||||
02/04/13 | 3,963 | 277,500 | ||||||||||||||||||||||||||||||
02/04/13 | 6,348 | 70.65 | 150,192 | |||||||||||||||||||||||||||||
James F. Farley | 02/04/13 | 48,000 | 240,000 | 480,000 | ||||||||||||||||||||||||||||
02/04/13 | 3,397 | 237,900 | ||||||||||||||||||||||||||||||
02/04/13 | 5,441 | 70.65 | 128,736 |
(1) | Amounts shown represent long-term performance awards made to | |
(2) | Represents the number of shares of restricted stock awarded in | |
(3) | Represents the number of stock options awarded in | |
25
(4) | The exercise price per share is equal to the closing price per share of the Company’s common stock on the date of grant. | |
(5) | The grant date fair values are calculated based in accordance with FASB ASC Topic 718. Restricted shares are valued at the average of the high and low prices of the Company’s common stock on the date of grant, resulting in a fair value of |
23
Option Awards | Stock Awards | |||||||||||||||||||||||
Number of | Number of | |||||||||||||||||||||||
Securities | Securities | Number of | Market Value of | |||||||||||||||||||||
Underlying | Underlying | Shares or Units | Shares or Units | |||||||||||||||||||||
Unexercised | Unexercised | Option | Option | of Stock That | of Stock That | |||||||||||||||||||
Options | Options | Exercise | Expiration | Have Not | Have Not | |||||||||||||||||||
Name | Exercisable | Unexercisable(1) | Price | Date | Vested(2) | Vested(3) | ||||||||||||||||||
Joseph H. Pyne | 24,536 | — | $ | 27.60 | 02/15/11 | 108,570 | $ | 4,782,509 | ||||||||||||||||
39,258 | — | $ | 35.66 | 01/26/12 | ||||||||||||||||||||
31,348 | 15,674 | $ | 48.00 | 02/08/13 | ||||||||||||||||||||
21,800 | 43,602 | $ | 23.98 | 01/30/14 | ||||||||||||||||||||
— | 41,178 | $ | 32.56 | 02/01/17 | ||||||||||||||||||||
David W. Grzebinski | — | 8,910 | $ | 31.35 | 02/08/17 | 45,432 | $ | 2,001,280 | ||||||||||||||||
Gregory R. Binion | 6,666 | 3,334 | $ | 48.65 | 02/01/13 | 29,326 | $ | 1,291,810 | ||||||||||||||||
13,333 | 6,667 | $ | 34.40 | 11/03/13 | ||||||||||||||||||||
5,450 | 10,900 | $ | 23.98 | 01/30/14 | ||||||||||||||||||||
— | 11,187 | $ | 32.56 | 02/01/17 | ||||||||||||||||||||
Dorman L. Strahan | 4,000 | — | $ | 36.94 | 02/15/12 | 10,869 | $ | 478,779 | ||||||||||||||||
3,187 | 1,594 | $ | 48.00 | 02/08/13 | ||||||||||||||||||||
2,216 | 4,433 | $ | 23.98 | 01/30/14 | ||||||||||||||||||||
— | 4,324 | $ | 32.56 | 02/01/17 | ||||||||||||||||||||
Amy D. Husted | 1,750 | 3,500 | $ | 23.98 | 01/30/14 | 8,892 | $ | 391,693 | ||||||||||||||||
— | 4,000 | $ | 32.56 | 02/01/17 |
Option Awards | Stock Awards | |||||||||||||||||||||||
Name | Number of Securities Underlying Unexercised Options Exercisable | Number of Securities Underlying Unexercised Options Unexercisable(1) | Option Exercise Price | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested(2) | Market Value of Shares or Units of Stock That Have Not Vested(3) | ||||||||||||||||||
Joseph H. Pyne | 41,178 | — | $ | 32.56 | 02/01/17 | 73,503 | $ | 7,295,173 | ||||||||||||||||
19,608 | 9,805 | $ | 46.74 | 01/31/18 | ||||||||||||||||||||
10,064 | 20,129 | $ | 65.28 | 02/15/19 | ||||||||||||||||||||
— | 31,742 | $ | 70.65 | 02/04/20 | ||||||||||||||||||||
Gregory R. Binion | 11,187 | — | $ | 32.56 | 02/01/17 | 20,474 | $ | 2,032,045 | ||||||||||||||||
5,326 | 2,664 | $ | 46.74 | 01/31/18 | ||||||||||||||||||||
3,019 | 6,039 | $ | 65.28 | 02/15/19 | ||||||||||||||||||||
— | 9,069 | $ | 70.65 | 02/04/20 | ||||||||||||||||||||
David W. Grzebinski | 8,910 | — | $ | 31.35 | 02/08/17 | 15,984 | $ | 1,586,412 | ||||||||||||||||
4,085 | 2,043 | $ | 46.74 | 01/31/18 | ||||||||||||||||||||
2,684 | 5,368 | $ | 65.28 | 02/15/19 | ||||||||||||||||||||
— | 9,069 | $ | 70.65 | 02/04/20 | ||||||||||||||||||||
William G. Ivey | 7,366 | 3,684 | $ | 46.74 | 01/31/18 | 15,052 | $ | 1,493,911 | ||||||||||||||||
2,264 | 4,530 | $ | 65.28 | 02/15/19 | ||||||||||||||||||||
— | 6,348 | $ | 70.65 | 02/04/20 | ||||||||||||||||||||
James F. Farley | 6,866 | 3,434 | $ | 46.74 | 01/31/18 | 13,897 | $ | 1,379,277 | ||||||||||||||||
2,180 | 4,360 | $ | 66.72 | 02/06/19 | ||||||||||||||||||||
— | 5,441 | $ | 70.65 | 02/04/20 |
(1) | The unexercisable options held by the named executive officers are exercisable or become exercisable, as follows: |
Grant Date | Vesting Date | Joseph H. Pyne | David W. Grzebinski | Gregory R. Binion | Dorman L. Strahan | Amy D. Husted | ||||||||||||||||||
01/30/09 | 01/30/11 | 21,801 | — | 5,450 | 2,216 | 1,750 | ||||||||||||||||||
01/30/12 | 21,801 | — | 5,450 | 2,217 | 1,750 | |||||||||||||||||||
02/01/08 | 02/01/11 | — | — | 3,334 | — | — | ||||||||||||||||||
02/08/08 | 02/08/11 | 15,674 | — | — | 1,594 | — | ||||||||||||||||||
11/03/08 | 11/03/11 | — | — | 6,667 | — | — | ||||||||||||||||||
02/01/10 | 02/01/11 | 13,726 | — | 3,729 | 1,441 | 1,333 | ||||||||||||||||||
02/01/12 | 13,726 | — | 3,729 | 1,441 | 1,333 | |||||||||||||||||||
02/01/13 | 13,726 | — | 3,729 | 1,442 | 1,334 | |||||||||||||||||||
02/08/10 | 02/08/11 | — | 2,970 | — | — | — | ||||||||||||||||||
02/08/12 | — | 2,970 | — | — | — | |||||||||||||||||||
02/08/13 | — | 2,970 | — | — | — |
24
Grant Date | Vesting Date | Joseph H. Pyne | Gregory R. Binion | David W. Grzebinski | William G. Ivey | James F. Farley | ||||||||||||||||||
01/31/11 | 01/31/14 | 9,805 | 2,664 | 2,043 | 3,684 | 3,434 | ||||||||||||||||||
02/06/12 | 02/06/14 | — | — | — | — | 2,180 | ||||||||||||||||||
02/06/15 | — | — | — | — | 2,180 | |||||||||||||||||||
02/15/12 | 02/15/14 | 10,064 | 3,019 | 2,684 | 2,265 | — | ||||||||||||||||||
02/15/15 | 10,065 | 3,020 | 2,684 | 2,265 | — | |||||||||||||||||||
02/04/13 | 02/04/14 | 10,580 | 3,023 | 3,023 | 2,116 | 1,813 | ||||||||||||||||||
02/04/15 | 10,581 | 3,023 | 3,023 | 2,116 | 1,814 | |||||||||||||||||||
02/04/16 | 10,581 | 3,023 | 3,023 | 2,116 | 1,814 |
26
(2) | The vesting dates of the restricted stock awards for the named executive officers are as follows: |
Award Dates | ||||||||||||||||||||||||||||||||||||||||||||||||
Name | Vesting Dates | 01/23/06 | 02/15/06 | 01/22/07 | 02/15/07 | 01/28/08 | 02/08/08 | 10/27/08 | 01/26/09 | 01/25/10 | 02/01/10 | 02/08/10 | ||||||||||||||||||||||||||||||||||||
Joseph H. Pyne | 01/24/11 | — | — | 6,579 | — | — | 5,000 | — | 8,833 | — | 7,371 | — | ||||||||||||||||||||||||||||||||||||
02/15/11 | — | 8,224 | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||
01/24/12 | — | — | 6,579 | — | — | 5,000 | — | 8,833 | — | 7,371 | — | |||||||||||||||||||||||||||||||||||||
01/24/13 | — | — | — | — | — | 5,000 | — | 8,833 | — | 7,371 | — | |||||||||||||||||||||||||||||||||||||
01/24/14 | — | — | — | — | — | — | — | 8,834 | — | 7,371 | — | |||||||||||||||||||||||||||||||||||||
01/24/15 | — | — | — | — | — | — | — | — | — | 7,371 | — | |||||||||||||||||||||||||||||||||||||
David W. Grzebinski | 01/02/11 | — | — | — | — | — | — | — | — | — | — | 14,009 | ||||||||||||||||||||||||||||||||||||
01/24/11 | — | — | — | — | — | — | — | — | — | — | 1,594 | |||||||||||||||||||||||||||||||||||||
01/02/12 | — | — | — | — | — | — | — | — | — | — | 23,449 | |||||||||||||||||||||||||||||||||||||
01/24/12 | — | — | — | — | — | — | — | — | — | — | 1,595 | |||||||||||||||||||||||||||||||||||||
01/24/13 | — | — | — | — | — | — | — | — | — | — | 1,595 | |||||||||||||||||||||||||||||||||||||
01/24/14 | — | — | — | — | — | — | — | — | — | — | 1,595 | |||||||||||||||||||||||||||||||||||||
01/24/15 | — | — | — | — | — | — | — | — | — | — | 1,595 | |||||||||||||||||||||||||||||||||||||
Gregory R. Binion | 01/24/11 | 800 | — | 640 | — | 1,000 | — | — | 2,208 | — | 2,002 | — | ||||||||||||||||||||||||||||||||||||
10/27/11 | — | — | — | — | — | — | 1,800 | — | — | — | — | |||||||||||||||||||||||||||||||||||||
01/24/12 | — | — | 640 | — | 1,000 | — | — | 2,208 | — | 2,002 | — | |||||||||||||||||||||||||||||||||||||
10/27/12 | — | — | — | — | — | — | 1,800 | — | — | — | — | |||||||||||||||||||||||||||||||||||||
01/24/13 | — | — | — | — | 1,000 | — | — | 2,209 | — | 2,002 | — | |||||||||||||||||||||||||||||||||||||
10/24/13 | — | — | — | — | — | — | 1,800 | — | — | — | — | |||||||||||||||||||||||||||||||||||||
01/24/14 | — | — | — | — | — | — | — | 2,209 | — | 2,003 | — | |||||||||||||||||||||||||||||||||||||
01/24/15 | — | — | — | — | — | — | — | — | — | 2,003 | — | |||||||||||||||||||||||||||||||||||||
Dorman L. Strahan | 01/24/11 | — | — | — | 720 | — | 508 | — | 898 | — | 774 | — | ||||||||||||||||||||||||||||||||||||
02/15/11 | — | 440 | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||
01/24/12 | — | — | — | 720 | — | 509 | — | 898 | — | 774 | — | |||||||||||||||||||||||||||||||||||||
01/24/13 | — | — | — | — | — | 509 | — | 898 | — | 774 | — | |||||||||||||||||||||||||||||||||||||
01/24/14 | — | — | — | — | — | — | — | 899 | — | 774 | — | |||||||||||||||||||||||||||||||||||||
01/24/15 | — | — | — | — | — | — | — | — | — | 774 | — | |||||||||||||||||||||||||||||||||||||
Amy D. Husted | 01/24/11 | 320 | — | 256 | — | 320 | — | — | 900 | 700 | — | — | ||||||||||||||||||||||||||||||||||||
01/24/12 | — | — | 256 | — | 320 | — | — | 900 | 700 | — | — | |||||||||||||||||||||||||||||||||||||
01/24/13 | — | — | — | — | 320 | — | — | 900 | 700 | — | — | |||||||||||||||||||||||||||||||||||||
01/24/14 | — | — | — | — | — | — | — | 900 | 700 | — | — | |||||||||||||||||||||||||||||||||||||
01/24/15 | — | — | — | — | — | — | — | — | 700 | — | — |
Date Granted | ||||||||||||||||||||||||||||||||||||||||||||
Name | Vesting Dates | 01/26/09 | 01/25/10 | 02/01/10 | 02/08/10 | 01/24/11 | 01/31/11 | 01/23/12 | 02/15/12 | 02/04/13 | Total | |||||||||||||||||||||||||||||||||
Joseph H. Pyne | 01/24/14 | 8,834 | — | 7,371 | — | — | 5,135 | — | 3,676 | 3,963 | 28,979 | |||||||||||||||||||||||||||||||||
01/24/15 | — | — | 7,371 | — | — | 5,135 | — | 3,676 | 3,963 | 20,145 | ||||||||||||||||||||||||||||||||||
01/24/16 | — | — | — | — | — | 5,135 | — | 3,677 | 3,963 | 12,775 | ||||||||||||||||||||||||||||||||||
01/24/17 | — | — | — | — | — | — | — | 3,677 | 3,963 | 7,640 | ||||||||||||||||||||||||||||||||||
01/24/18 | — | — | — | — | — | — | — | — | 3,964 | 3,964 | ||||||||||||||||||||||||||||||||||
Gregory R. Binion | 01/24/14 | 2,209 | — | 2,003 | — | — | 1,395 | — | 1,103 | 1,132 | 7,842 | |||||||||||||||||||||||||||||||||
01/24/15 | — | — | 2,003 | — | — | 1,395 | — | 1,103 | 1,132 | 5,633 | ||||||||||||||||||||||||||||||||||
01/24/16 | — | — | — | — | 1,395 | — | 1,103 | 1,132 | 3,630 | |||||||||||||||||||||||||||||||||||
01/24/17 | — | — | — | — | — | — | — | 1,103 | 1,133 | 2,236 | ||||||||||||||||||||||||||||||||||
01/24/18 | — | — | — | — | — | — | — | — | 1,133 | 1,133 | ||||||||||||||||||||||||||||||||||
David W. Grzebinski | 01/24/14 | — | — | — | 1,595 | — | �� | 1,070 | — | 980 | 1,132 | 4,777 | ||||||||||||||||||||||||||||||||
01/24/15 | — | — | — | 1,595 | — | 1,070 | — | 980 | 1,132 | 4,777 | ||||||||||||||||||||||||||||||||||
01/24/16 | — | — | — | — | — | 1,070 | — | 981 | 1,132 | 3,183 | ||||||||||||||||||||||||||||||||||
01/24/17 | — | — | — | — | — | — | — | 981 | 1,133 | 2,114 | ||||||||||||||||||||||||||||||||||
01/24/18 | — | — | — | — | — | — | — | — | 1,133 | 1,133 | ||||||||||||||||||||||||||||||||||
William G. Ivey | 01/24/14 | 1,920 | 1,280 | — | — | 1,100 | — | — | 827 | 792 | 5,919 | |||||||||||||||||||||||||||||||||
01/24/15 | — | 1,280 | — | — | 1,100 | — | — | 827 | 792 | 3,999 | ||||||||||||||||||||||||||||||||||
01/24/16 | — | — | — | — | 1,100 | — | — | 827 | 793 | 2,720 | ||||||||||||||||||||||||||||||||||
01/24/17 | — | — | — | — | — | — | — | 828 | 793 | 1,621 | ||||||||||||||||||||||||||||||||||
01/24/18 | — | — | — | — | — | — | — | — | 793 | 793 | ||||||||||||||||||||||||||||||||||
James F. Farley | 01/24/14 | 1,920 | 1,280 | — | — | 1,100 | — | 680 | — | 679 | 5,659 | |||||||||||||||||||||||||||||||||
01/24/15 | — | 1,280 | — | — | 1,100 | — | 680 | — | 679 | 3,739 | ||||||||||||||||||||||||||||||||||
01/24/16 | — | — | — | — | 1,100 | — | 680 | — | 679 | 2,459 | ||||||||||||||||||||||||||||||||||
01/24/17 | — | — | — | — | — | — | 680 | — | 680 | 1,360 | ||||||||||||||||||||||||||||||||||
01/24/18 | — | — | — | — | — | — | — | — | 680 | 680 |
(3) | The market value of the shares of restricted stock that had not vested as of December 31, |
Option Exercises and Stock Vested During 20102013
Option Awards | Stock Awards | |||||||||||||||
Number of Shares | Number of Shares | |||||||||||||||
Acquired on | Value Realized | Acquired on | Value Realized | |||||||||||||
Name | Exercise | on Exercise(1) | Vesting | on Vesting(2) | ||||||||||||
Joseph H. Pyne | — | $ | — | 36,636 | $ | 1,253,639 | ||||||||||
Gregory R. Binion | — | — | 7,248 | 262,546 | ||||||||||||
Dorman L. Strahan | 8,400 | 116,477 | 3,086 | 106,222 | ||||||||||||
Amy D. Husted | — | — | 2,116 | 73,721 |
Option Awards | Stock Awards | |||||||||||||||
Name | Number of Shares Acquired on Exercise | Value Realized on Exercise(1) | Number of Shares Acquired on Vesting | Value Realized on Vesting(2) | ||||||||||||
Joseph H. Pyne | — | — | 30,015 | $ | 1,983,691 | |||||||||||
Gregory R. Binion | 20,000 | $ | 899,900 | 9,509 | 670,228 | |||||||||||
David W. Grzebinski | — | — | 3,645 | 240,898 | ||||||||||||
William G. Ivey | 19,200 | 966,528 | 6,407 | 423,439 | ||||||||||||
James F. Farley | 12,000 | 519,360 | 6,260 | 413,723 |
(1) | Based on the closing price of the Company’s common stock on the date of exercise. | |
(2) | Based on the closing price of the Company’s common stock on the date of vesting. |
25
27
Years of | Present Value of | |||||||||
Credited | Accumulated | |||||||||
Name | Plan Name | Service | Benefit | |||||||
Joseph H. Pyne | Kirby Inland Marine LP — | — | $ | 535,381 | ||||||
Deferred Compensation Plan(1) | ||||||||||
Gregory R. Binion | Kirby Pension Plan(2) | 11 | 59,779 | |||||||
Amy D. Husted | Kirby Pension Plan(2) | 5 | 10,882 |
Name | Plan Name | Years of Credited Service | Present Value of Accumulated Benefit | |||||||
Joseph H. Pyne | Kirby Inland Marine LP — Deferred Compensation Plan(1) | — | $ | 599,196 | ||||||
Gregory R. Binion | Kirby Pension Plan(2) | 11 | 79,168 |
(1) | Kirby Inland Marine, LP has an unfunded Deferred Compensation Agreement with Mr. Pyne in connection with his previous employment as its President. Mr. Pyne has enough years of service to qualify for the maximum payment of $4,175 per month under the agreement. The agreement provides for benefits to Mr. Pyne of $4,175 per month commencing upon the later of his severance from the employment of the Company or his 65th birthday and continuing until the month of his death. If Mr. Pyne should die prior to receiving such deferred compensation, the agreement provides for monthly payments to his beneficiary for a period of not less than 60 nor more than 120 months, depending on the circumstances. The agreement also provides that no benefits will be paid if Mr. Pyne is terminated for a “wrongful action” (as defined in the agreement). | |
(2) | The Company sponsors a defined benefit plan, the Kirby Pension Plan, for vessel personnel and shore based tankermen employed by certain subsidiaries of the Company. Shoreside personnel employed by Hollywood prior to its merger with a subsidiary of the Company in 1999, including Mr. Binion, |
Nonqualified Deferred Compensation
Registrant | ||||||||||||
Contributions in | Aggregate | Aggregate | ||||||||||
Last Fiscal | Earnings in | Balance at | ||||||||||
Name | Year(1) | Last Fiscal Year(2) | Last Fiscal Year End | |||||||||
Joseph H. Pyne | $ | — | $ | 207,924 | $ | 1,648,411 | ||||||
Gregory R. Binion | — | 2,877 | 20,452 | |||||||||
Dorman L. Strahan | — | 1,219 | 9,158 |
Name | Registrant Contributions in Last Fiscal Year(1) | Aggregate Earnings in Last Fiscal Year(2) | Aggregate Balance at Last Fiscal Year End | |||||||||
Joseph H. Pyne | $ | — | $ | 178,634 | $ | 2,351,289 | ||||||
Gregory R. Binion | — | 15,118 | 120,901 | |||||||||
David W. Grzebinski | — | 7,197 | 60,789 | |||||||||
William G. Ivey | — | 29,176 | 215,782 | |||||||||
James F. Farley | — | 12,066 | 91,596 |
(1) | The Company has an unfunded, nonqualified Deferred Compensation Plan for Key Employees which was adopted | |
(2) | Earnings on deferred compensation under the Deferred Compensation Plan for Key Employees are calculated in the same manner and at the same rate as earnings on externally managed investments of salaried employees participating in the Company’s Profit Sharing Plan. |
26
28
Number of Securities | ||||||||||||
Remaining Available | ||||||||||||
for Future Issuance | ||||||||||||
Number of | Under Equity | |||||||||||
Securities to be | Compensation Plans | |||||||||||
Issued Upon | Weighted-Average | (Excluding Securities | ||||||||||
Exercise of | Exercise Price of | Reflected in First | ||||||||||
Plan Category | Outstanding Options | Outstanding Options | Column) | |||||||||
Equity compensation plans approved by stockholders | 434,447 | $ | 33.53 | 1,457,516 | ||||||||
Equity compensation plans not approved by stockholders(1) | 356,429 | $ | 34.88 | 324,766 | ||||||||
Total | 790,876 | $ | 34.14 | 1,782,282 | ||||||||
Plan Category | Number of Securities to be Issued Upon Exercise of Outstanding Options | Weighted-Average Exercise Price of Outstanding Options | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in First Column) | |||||||||
Equity compensation plans approved by stockholders | 379,604 | $ | 55.42 | 2,667,619 | ||||||||
Equity compensation plans not approved by stockholders(1) | 320,322 | $ | 50.64 | 610,041 | ||||||||
Total | 699,926 | $ | 53.23 | 3,277,660 |
(1) | The only plan included in the table that was adopted without stockholder approval was the 2000 Nonemployee Director Stock |
Potential Payments Upon Change in Control
If a change in control were to have occurred on December 31, 2010,2013, all of the named executive officers’ outstanding options to acquire Company common stock would have become immediately exercisable. The options were granted at a price equal to the fair market value of the Company’s common stock on the date of grant, vest in equal increments over three years and have a term of five or seven years. Restricted stock awards granted to the named executive officers would have immediately vested. The restricted stock awards vest in equal increments over five years, except for 37,458 shares of restricted stock awarded to Mr. Grzebinski, of which 14,009 shares vested on January 2, 2011 and 23,449 shares vest on January 2, 2012.years. Performance awards would have been considered earned so that holders of the awards would have been entitled to receive the target performance award the holder could have earned for the proportionate part of the performance period prior to the change in control. The outstanding options would have become immediately exercisable and the restricted stock award and performance awards would have become immediately vested regardless of whether the named executive officer was terminated or voluntarily terminated employment following the change of control. The value of the stock options and restricted stock awards is based on the Company’s closing market price of $44.05$99.25 per share on December 31, 2010, the last trading day before year-end.
Joseph H. Pyne
Mr. Pyne’s options to purchase an aggregate of 84,78061,676 shares of common stock would have become fully exercisable on December 31, 2010,2013, if a change in control had occurred on that date. Under the terms of Mr. Pyne’s stock options, he would have to pay $2,386,332$4,014,879 to purchase the shares. Accordingly, the maximum value of the accelerated vesting of the 84,78061,676 options would have been $1,348,227$2,106,464 ($44.0599.25 per share value on December 31, 2010,2013, multiplied by 84,78061,676 shares minus $2,386,332,$4,014,879, the aggregate exercise price of the options). All of the other options held by Mr. Pyne on December 31, 2010 have an exercise price higher than the year end stock price of $44.05.
Mr. Pyne had 108,57073,503 shares of restricted stock that were not vested as of December 31, 2010.2013. If a change of control had occurred on that date, the 108,57073,503 shares would have become fully vested. The maximum value of the accelerated vesting of Mr. Pyne’s restricted stock would have been $4,782,509$7,295,173 ($44.0599.25 per share value on December 31, 2010,2013, multiplied by 108,57073,503 restricted shares).
On December 31, 2010,2013, Mr. Pyne would have become entitled to payments under previously granted performance awards totaling $1,309,600$1,339,867 if a change in control had occurred on that date.
27
29
Mr. Binion’s stock options, he would have to pay $1,159,466 to purchase the shares. Accordingly, the maximum value of the accelerated vesting of the 17,772 options would have been $604,405 ($99.25 per share value on December 31, 2013, multiplied by 17,772 shares minus $1,159,466, the aggregate exercise price of the options).
Mr. Binion had 20,474 shares of restricted stock that were not vested as of December 31, 2013. If a change of control had occurred on that date, the 20,474 shares would have become fully vested. The maximum value of the accelerated vesting of Mr. Binion’s restricted stock would have been $2,032,045 ($99.25 per share value on December 31, 2013, multiplied by 20,474 restricted shares).
On December 31, 2013, Mr. Binion would have become entitled to payments under previously granted performance awards totaling $394,773 if a change in control had occurred on that date.
David W. Grzebinski
Mr. Grzebinski’s options to purchase an aggregate of 16,480 shares of common stock would have become fully exercisable on December 31, 2013, if a change in control had occurred on that date. Under the terms of Mr. Grzebinski’s stock options, he would have to pay $279,329$1,086,638 to purchase the shares. Accordingly, the maximum value of the accelerated vesting of the 8,91016,480 options would have been $113,157$549,002 ($44.0599.25 per share value on December 31, 2010,2013, multiplied by 8,91016,480 shares minus $279,329,$1,086,638, the aggregate exercise price of the options). No other options were held by Mr. Grzebinski on December 31, 2010.
Mr. Grzebinski had 45,43215,984 shares of restricted stock that were not vested as of December 31, 2010.2013. If a change of control had occurred on that date, the 45,43215,984 shares would have become fully vested. The maximum value of the accelerated vesting of Mr. Grzebinski’s restricted stock would have been $2,001,280$1,586,412 ($44.0599.25 per share value on December 31, 2010,2013, multiplied by 45,43215,984 restricted shares).
On December 31, 2010,2013, Mr. Grzebinski would have become entitled to payments under previously granted performance awards totaling $95,833$366,880 if a change in control had occurred on that date.
Gregory R. BinionWilliam G. Ivey
Mr. Binion’sIvey’s options to purchase an aggregate of 28,75414,562 shares of common stock would have become fully exercisable on December 31, 2010,2013, if a change in control had occurred on that date. Under the terms of Mr. Binion’sIvey’s stock options, he would have to pay $854,976$916,395 to purchase the shares. Accordingly, the maximum value of the accelerated vesting of the 28,75414,562 options would have been $411,638$528,884 ($44.0599.25 per share value on December 31, 2010,2013, multiplied by 28,75414,562 shares minus $854,976,$916,395, the aggregate exercise price of the options). All the other options held by
Mr. Binion on December 31, 2010 have an exercise price higher than the year end stock price of $44.05.
On December 31, 2010,2013, Mr. BinionIvey would have become entitled to payments under previously granted performance awards totaling $347,745$290,933 if a change in control had occurred on that date.
Dorman L. StrahanJames F. Farley
Mr. Strahan’sFarley’s options to purchase an aggregate of 8,75713,235 shares of common stock would have become fully exercisable on December 31, 2010,2013, if a change in control had occurred on that date. Under the terms of Mr. Strahan’sFarley’s stock options, he would have to pay $247,093$835,811 to purchase the shares. Accordingly, the maximum value of the accelerated vesting of the 8,75713,235 options would have been $138,653$477,763 ($44.0599.25 per share value on December 31, 2010,2013, multiplied by 8,75713,235 shares minus $247,093,$835,811, the aggregate exercise price of the options). All the other options held by
30
Mr. Strahan on December 31, 2010 have an exercise price higher than the year end stock price of $44.05.
On December 31, 2010,2013, Mr. StrahanFarley would have become entitled to payments under previously granted performance awards totaling $100,639$247,568 if a change in control had occurred on that date.
28
The Audit Committee of the Board of Directors of the Company is responsible for monitoring the integrity of the Company’s financial reporting, accounting procedures and internal controls. The Audit Committee is composed of threefour directors, all of whom are independent within the meaning of SEC and NYSE rules. The Audit Committee operates under a written charter adopted by the Board.
Management is primarily responsible for the Company’s financial reporting process and internal controls. The Company’s independent auditors are responsible for performing an audit of the Company’s financial statements and issuing a report on the conformity of the financial statements with generally accepted accounting principles. The Company’s independent auditors are also responsible for performing an audit of the Company’s internal control over financial reporting. The Audit Committee is responsible for overseeing those processes.
The Audit Committee has reviewed and discussed the audited financial statements of the Company for the year ended December 31, 20102013 with management and the independent auditors. The Audit Committee also (a) discussed with the independent auditors the matters required to be discussed by Statement on Auditing StandardsStandard No. 114, as amended and16, as adopted by the Public Company Accounting Oversight Board (the “PCAOB”), (b) received the written disclosures and letter from the independent auditors required by the applicable requirements of the PCAOB regarding the independent auditors’ communications with the Audit Committee concerning independence and (c) discussed with the independent auditors their independence.
Based on the Audit Committee’s review of the audited financial statements for the year ended December 31, 20102013 and the Audit Committee’s discussions with management and the independent auditors, the Audit Committee recommended to the Board of Directors of the Company that the audited financial statements be included in the Company’s Annual Report onForm 10-K for the year ended December 31, 2010,2013, which has been filed with the Securities and Exchange Commission.
AUDIT COMMITTEE |
Bob G. Gower,Chairman |
Richard J. Alario |
David L. Lemmon |
Richard R. Stewart |
31
RATIFICATION OF THE AUDIT COMMITTEE’S SELECTION OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM (PROPOSAL 2)
The Audit Committee has selected KPMG LLP (“KPMG”) as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2011.2014. KPMG served as the Company’s independent accounting firm for 2010.2013. Although the Audit Committee has the sole authority and responsibility to select and evaluate the performance of the independent accounting firm for the Company, the Board is requesting, as a matter of good corporate governance, that the Company’s stockholders ratify the selection of KPMG for 2011.
29
Ratification of the selection of KPMG requires the affirmative vote of a majority of the shares represented at the meeting in person or by proxy. If the stockholders do not ratify the selection of KPMG, the Audit Committee will reconsider the selection. However, because of the difficulty and expense of changing independent auditors at this point in the year, the selection of KPMG will probably be continued for 20112014 in the absence of extraordinary reasons for making an immediate change. If the stockholders do ratify the selection of KPMG, the Audit Committee will retain the authority to make a change if warranted in its judgment.
Representatives of KPMG are expected to be present at the 20112014 Annual Meeting of Stockholders, with the opportunity to make a statement if they desire to do so, and are expected to be available to respond to appropriate questions.
Fees Paid to the Independent Registered Public Accounting Firm
The following table sets forth the fees billed by KPMG, the Company’s independent registered public accounting firm, during the last two fiscal years:
2010 | 2009 | |||||||
Audit Fees | $ | 835,000 | $ | 900,000 | ||||
Audit-Related Fees | 89,500 | 110,000 | ||||||
Tax Fees | 24,000 | 25,000 | ||||||
TOTAL | $ | 948,500 | $ | 1,035,000 | ||||
2013 | 2012 | |||||||
Audit Fees | $ | 1,288,000 | $ | 1,561,000 | ||||
Audit-Related Fees | 95,000 | 110,000 | ||||||
Tax Fees | 71,000 | 96,000 | ||||||
|
|
|
| |||||
TOTAL | $ | 1,454,000 | $ | 1,767,000 | ||||
|
|
|
|
Audit Feesare fees for professional services rendered by KPMG for the audit of the Company’s annual financial statements, audit of internal control over financial reporting, review of the Company’s quarterly financial statements or services normally provided in connection with statutory or regulatory filings.
Audit-Related Feesare fees for assurance and related services reasonably related to the performance of the audit or review of the Company’s financial statements. Services performed by KPMG in this category consisted of the audit of the Company’s benefit plans.
Tax Feesare fees for professional services rendered by KPMG for tax compliance, tax advice and tax planning. Services performed by KPMG in this category for 20102013 included the review of the Company’s 20092012 federal income tax return.
Each engagement of the independent registered public accounting firm to perform audit or non-audit services must be approved in advance by the Company’s Audit Committee or by its Chairman pursuant to delegated authority.
32
ADVISORY VOTE ON EXECUTIVE COMPENSATION (PROPOSAL 3)
The Company is requesting your approval, on a non-binding advisory basis, of the compensation of the Company’s named executive officers as disclosed and discussed under “EXECUTIVE COMPENSATION” on pages 14-2915-31 of this Proxy Statement. We believe that our executive compensation:
is competitive as necessary to attract and retain qualified executives; | ||
30
is designed with both short-term and long-term business objectives of the Company in mind;
does not encourage excessive risk-taking by the Company’s management; and
properly aligns the interests of management with those of the Company’s stockholders.
For those reasons, we are asking you to approve the following resolution:
RESOLVED that the compensation of the Company’s named executive officers as described under “EXECUTIVE COMPENSATION” in the Company’s Proxy Statement for its 20112014 Annual Meeting of Stockholders is approved.
Although the vote on approval of executive compensation is not binding, the Compensation Committee and the Board will consider the result of the vote in making future compensation decisions.
The Board of Directors of the Company unanimously recommends that you vote “FOR” Proposal 3 approving the compensation of the named executive officers as disclosed in this Proxy Statement.
OTHER BUSINESS (PROPOSAL 5)4)
The Board knows of no other business to be brought before the Annual Meeting. However, if any other matters are properly presented, it is the intention of the persons named in the accompanying proxy to take such action as in their judgment is in the best interest of the Company and its stockholders.
STOCKHOLDER PROPOSALS FOR 20122015 ANNUAL MEETING
Stockholder proposals must be received by the Company at its principal executive offices no later than November 19, 201118, 2014 to be considered for inclusion in the Company’s proxy statement and form of proxy for the 20122015 Annual Meeting of Stockholders.
Under the Company’s Bylaws, written notice (containing the information required by the Bylaws) of any stockholder proposal for action at an annual meeting of stockholders (whether or not proposed for inclusion in the Company’s proxy materials) must be received by the Company at its principal executive offices not less than 90 nor more than 120 days prior to the anniversary date of the prior year’s annual meeting of stockholders and must be a proper subject for stockholder action.
BY ORDER OF THE BOARD OF DIRECTORS |
THOMAS G. ADLER Secretary |
March 18, 2011
Houston, Texas
31
33
Using a black this example. Please do not write outside | x |
Annual Meeting Proxy Card |
q PLEASE FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE. q
– – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – –
A | Proposals — The Board of Directors recommends a voteFOR all the nominees |
1. | Election of Directors: | For | Against | Abstain | For | Against | Abstain | For | Against | Abstain | + | |||||||||||||||||
01 | ¨ | ¨ | ¨ | 02 - David | ¨ | ¨ | ¨ | 03 | ¨ | ¨ | ¨ |
For | Against | Abstain | For | Against | Abstain | |||||||||||||
2. | Ratification of the selection of KPMG LLP as Kirby’s independent registered public accounting firm for 2014. | ¨ | ¨ | ¨ | 3. | Advisory vote on the approval of the compensation of Kirby’s named executive officers. | ¨ | ¨ | ¨ | |||||||||
4. | The Proxies are authorized to vote in their discretion upon such other business as may properly come before the meeting. |
B | Non-Voting |
Change of Address— Please print new address below.
C | Authorized Signatures — This |
Please sign exactly as name(s) appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, corporate officer, trustee, guardian, or custodian, please give full title.
Date (mm/dd/yyyy) — Please print date below. | Signature 1 — Please keep signature within | Signature 2 — Please keep signature within | ||||||
// |
q PLEASE FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE. q
– – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – –
Proxy — Kirby Corporation
55 Waugh Drive, Suite 1000
P.O. Box 1745
Houston, Texas 77251-1745
This Proxy is solicited on behalf of the Board of Directors of Kirby Corporation.
The undersigned hereby appoints Joseph H. Pyne, David W. Grzebinski, G. Stephen Holcomb and Thomas G. Adler, and each of them, as Proxies, each with the power to appoint his substitute, and hereby authorizes each to represent and to vote, as designated below, all the shares of common stock, par value $0.10 per share, of Kirby Corporation (the “Company”) held of record by the undersigned as of the close of business on March 3, 2014, at the Annual Meeting of Stockholders to be held on April 29, 2014, at 55 Waugh Drive, 9th floor, Houston, Texas 77007 at 10:00 A.M. (CDT) and any adjournment(s) thereof.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY THE UNDERSIGNED STOCKHOLDER(S). IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR THE PERSONS LISTED IN PROPOSAL 1. SHOULD ANY OF THEM REFUSE OR BECOME UNABLE TO ACCEPT ELECTION AS A DIRECTOR OF THE COMPANY, THE PROXY WILL BE VOTED FOR THE ELECTION OF SUCH PERSON OR PERSONS AS MAY BE NOMINATED OR DESIGNATED BY THE BOARD OF DIRECTORS. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR PROPOSALS 2 AND 3. THE PROXIES WILL USE THEIR DISCRETION WITH RESPECT TO ANY MATTER REFERRED TO IN ITEM 4.
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY PROMPTLY USING THE ENCLOSED ENVELOPE.
(Continued and to be signed on reverse side)