SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement
[_] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(a)(b))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
TRANSMONTAIGNE INC.
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
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Notes:
TRANSMONTAIGNE INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
The Annual Meeting of Stockholders of TRANSMONTAIGNE INC., a Delaware
corporation ("TransMontaigne" or the "Company"), will be held in the Central
City Room of the Brown Palace Hotel, 321 Seventeenth Street, Denver, Colorado,
on Thursday, November 15, 2001, at 9:00 a.m., Denver Time, for the following
purposes:
1. To elect eight Directors to serve until the next Annual Meeting of
Stockholders and until their successors have been elected and qualified.
The Board of Directors is nominating the following individuals for
election as Directors: Cortlandt S. Dietler, Donald H. Anderson, Peter
B. Griffin, Ben A. Guill, John A. Hill, Bryan H. Lawrence, Harold R.
Logan, Jr., and Edwin H. Morgens;
2. To consider and act upon such other matters and to transact such other
business as may properly come before the meeting and any adjournment or
postponement thereof.
These matters are fully discussed in the Proxy Statement. The Company's 2001
Annual Report accompanies the Proxy Statement.
The Board of Directors has fixed the close of business on September 21,
2001, as the record date for the meeting. Only holders of Common Stock and
Series A Convertible Preferred Stock of record at such time are entitled to
receive notice of and to vote at the meeting and any adjournment or
postponement thereof. The holders of Series A Convertible Preferred Stock
shall vote together with holders of Common Stock as a single class on all
actions to be voted on by the stockholders of the Company other than the
election of Directors. Each holder of Series A Convertible Preferred Stock
shall be entitled to such number of votes per share on each action as shall
equal the number of shares of Common Stock (excluding fractions of a share)
into which each share of Series A Convertible Preferred Stock is convertible
as of the record date.
Whether or not you plan to attend the meeting in person, please indicate
your voting instructions on the enclosed proxy, date and sign it, and return
it promptly in the stamped return envelope which is included with these
materials. In the event you do attend the meeting in person, you may withdraw
your proxy and vote in person.
By Order of the Board of Directors
/s/ Erik B. Carlson
ERIK B. CARLSON, Secretary
Denver, Colorado
October 12, 2001
(Approximate mailing date of proxy materials)
PLACE AND TIME OF ANNUAL MEETING
CENTRAL CITY ROOM
BROWN PALACE HOTEL
321 SEVENTEENTH STREET
DENVER, COLORADO
Thursday, November 15, 2001, 9:00 a.m. Denver Time
TRANSMONTAIGNE INC.
2750 REPUBLIC PLAZA
370 SEVENTEENTH STREET
DENVER, COLORADO 80202
PROXY STATEMENT
GENERAL
This Proxy Statement and the enclosed proxy are being mailed on or about
October 12, 2001 to stockholders of record on September 21, 2001 of the common
stock, $0.01 par value (the "Common Stock") and the holders of Series A
Convertible Preferred Stock (the "Series A Preferred") of TransMontaigne Inc.
("TransMontaigne" or the "Company") in connection with the solicitation of
proxies for use at the 2001 Annual Meeting of Stockholders of the Company (the
"Annual Meeting"), notice of which appears on the preceding page, and at any
postponement or adjournment thereof. The Annual Meeting will be held on
Thursday, November 15, 2001, at 9:00 a.m., Denver Time, in the Central City
Room at the Brown Palace Hotel, 321 Seventeenth Street, Denver, Colorado.
The cost of soliciting proxies is being paid by the Company. In addition to
the mailings, the Company's officers, Directors and other regular employees,
without additional compensation, may solicit proxies personally or by other
appropriate means.
Only stockholders of record as of the record date, including holders of the
Series A Preferred, are entitled to notice of and to vote at the Annual
Meeting. The holders of the Series A Preferred shall vote together with
holders of Common Stock as a single class on all actions to be voted on by the
stockholders of the Company other than the election of Directors. Each holder
of Series A Preferred shall be entitled to such number of votes per share on
each action as shall be equal to the number of shares of Common Stock
(excluding fractions of a share) into which each share of Series A Preferred
is convertible as of the record date. The Company will request brokerage
firms, bank nominees and other institutions that act as nominees or
fiduciaries for owners of Common Stock and the Series A Preferred, to forward
this Proxy Statement to persons for whom they hold shares and to obtain
authorization for the execution of proxies. If your shares of Common Stock or
Series A Preferred are held in the name of a brokerage firm, bank nominee or
other institution, only it can sign a proxy with respect to your shares.
Accordingly, please contact the person responsible for your account and give
instructions for a proxy to be signed representing your shares of Common Stock
and/or Series A Preferred.
A stockholder or holder of the Series A Preferred giving a proxy has the
power to revoke the proxy at any time before it is exercised. A proxy may be
revoked by delivering to the Company an instrument revoking the proxy or a
duly executed proxy bearing a later date. The powers of the proxy holders will
be suspended if the person executing the proxy is present at the meeting and
elects to vote in person. If the proxy is neither revoked nor suspended, it
will be voted by one or more of the proxy holders therein named.
QUORUM AND VOTING
On September 21, 2001, the record date for the determination of stockholders
and holders of the Series A Preferred entitled to receive notice of and to
vote at the Annual Meeting, the Company had outstanding 31,806,829 shares of
Common Stock and 174,825 shares of Series A Preferred convertible into
11,655,013 shares of Common Stock. Each of such shares of Common Stock is
entitled to one vote at the Annual Meeting. The holders of a majority of the
shares entitled to vote at the Annual Meeting, whether present in person or
represented by proxy, will constitute a quorum for the transaction of business
at the Annual Meeting. Directors shall be elected by a plurality of the votes
of the shares present in person or by proxy at the Annual Meeting and entitled
to vote. Approval of all other matters shall be determined by the affirmative
vote of the majority of the shares present in person or represented by proxy
at the meeting and entitled to vote. If no voting direction is
1
indicated on the proxy card, the shares will be considered votes FOR the
election of the nominees for Director. Proxy cards that are not signed or that
are not returned are treated as not voted for any purposes. If a broker
indicates on a proxy card that it does not have discretionary authority as to
certain shares to vote on a particular matter (a "broker non-vote"), those
shares will not be considered as present and entitled to vote with respect to
that matter. Abstentions with respect to any matter will be treated as shares
present and entitled to vote. Consequently, abstentions and broker non-votes
will have no effect with respect to the election of Directors. The Company
knows of no proposals to be considered at the Annual Meeting other than those
set forth in the Notice of Annual Meeting.
ELECTION OF DIRECTORS
Nominees
The Company's By-laws provide that the number of Directors shall be fixed by
its Board of Directors. The number of Directors is presently fixed at eight.
The Company has agreed to take all action necessary to cause two Directors
designated by affiliates of First Reserve Corporation from time to time to be
elected to the Company's Board of Directors so long as their collective
ownership in the Company is at least 10%. The affiliates of First Reserve
Corporation have designated Mr. Guill and Mr. Hill as their nominees for
Directors.
Further, the Company has agreed to take all action necessary to cause one
Director designated by Louis Dreyfus Corporation ("Dreyfus") from time to time
to be elected to the Company's Board of Directors so long as its ownership in
the Company is at least 10%. Dreyfus has designated Mr. Griffin as its nominee
for Director.
Management has been informed that all nominees are willing to serve as
Directors if elected, but if any of them should decline or be unable to act as
a Director, the proxy holders will vote for the election of another person or
persons as they, in their discretion, may choose. The Board of Directors has
no reason to believe that any nominee will be unable or unwilling to serve.
The following sets forth, as to each of the nominees, such person's age,
principal occupations during recent years, and the period during which such
person has served as a Director of the Company. Nominees elected at the Annual
Meeting to serve as Directors will serve for a term of one year, until the
next annual meeting of the Company's stockholders and until their successors
have been elected and qualified.
THE BOARD RECOMMENDS A VOTE FOR THE ELECTION OF EACH OF THE NOMINEES NAMED
BELOW.
Cortlandt S. Dietler, age 80, has been the Chairman of TransMontaigne since
April 1995. Mr. Dietler was Chief Executive Officer from April 1995 through
September 1999. He was the founder, Chairman and Chief Executive Officer of
Associated Natural Gas Corporation, a natural gas gathering, processing and
marketing company, prior to its 1994 merger with PanEnergy Corporation, on
whose Board he served as an Advisory Director, prior to its merger with Duke
Energy Corporation. Mr. Dietler also serves as a director of Carbon Energy
Corporation, Forest Oil Corporation, Hallador Petroleum Company and Key
Production Company, Inc. Industry affiliations include: Member, National
Petroleum Council; Director, American Petroleum Institute; past Director,
Independent Petroleum Association of America; and Director, past President and
Life Member, Rocky Mountain Oil & Gas Association.
Donald H. Anderson, age 53, has been a Director of TransMontaigne, as well
as Vice Chairman and Chief Executive Officer since October 1, 1999. On January
4, 2000, Mr. Anderson was appointed President of TransMontaigne. Mr. Anderson
was the Executive Director and a Principal of Western Growth Capital LLC
("WGC"), a Colorado-based private equity investment and consulting firm. He
joined WGC in March 1997 and assumed responsibility for the firm's private
equity and consulting services activities. Prior to joining WGC, Mr. Anderson
was Chairman, President and Chief Executive Officer of PanEnergy Services,
PanEnergy's non-
2
jurisdictional operating subsidiary, from December 1994 until PanEnergy's
announced merger with Duke Energy Corporation in March 1997. During that time
period, Mr. Anderson also served as a director of TEPPCO Partners, LLP. Mr.
Anderson was previously President, Chief Operating Officer and a director of
Associated Natural Gas Corporation until its merger with PanEnergy Corporation
in 1994.
Peter B. Griffin, age 56, has been a Director of TransMontaigne since July
2000. Mr. Griffin is President of Louis Dreyfus Corporation ("Dreyfus"),
having been appointed to that position in 1998. Mr. Griffin served as
Executive Vice President of Dreyfus from 1995 to 1998. Mr. Griffin joined
Dreyfus in 1976 as Corporate Controller and subsequently held various
administrative and financial positions in both the energy and agricultural
business segments. Prior to joining Dreyfus, Mr. Griffin was an accountant
with Arthur Young & Company.
Ben A. Guill, age 50, was elected to the Board of Directors of
TransMontaigne effective March 21, 2001 to replace and serve the remaining
term of William E. Macaulay, who resigned as a Director effective March 21,
2001. Mr. Guill is President of First Reserve Corporation and joined that firm
in 1998. Prior to joining First Reserve, Mr. Guill spent 18 years with Simmons
& Company International, an investment banking firm, where he served as
Managing Director and Co-Head of Investment Banking. Prior to that time he was
with Blyth Eastman Dillon & Company. Mr. Guill is a director of National
Oilwell, Inc., Superior Energy Services, Inc., Chicago Bridge & Iron Company,
N.V., Destiny Resource Services Corp. and Dresser, Inc.
John A. Hill, age 59, has been a Director of TransMontaigne since April
1995. Mr. Hill is Vice Chairman of the Board, Managing Director and founder of
First Reserve Corporation. First Reserve Corporation is an investment company
specializing in management buyouts and acquisitions in the energy and energy-
related industries based in Greenwich, Connecticut. Mr. Hill is Chairman of
the Board of Trustees of the Putnam Mutual Funds in Boston and serves as a
director of Devon Energy Corporation, various private companies owned by First
Reserve and Continuum Health Partners in New York.
Bryan H. Lawrence, age 59, has been a Director of TransMontaigne since April
1995. Mr. Lawrence joined Dillon, Read & Co. Inc., an investment banking firm,
in January 1966 and served as a Managing Director until September 21, 1997
when Mr. Lawrence resigned to establish Yorktown Partners LLC to manage
Yorktown Energy Partners III, L.P. and predecessor partnerships previously
managed by Dillon, Read & Co. Inc. Mr. Lawrence also serves as a director of
Vintage Petroleum, Inc., D&K Healthcare Services, Inc., Hallador Petroleum
Company and Carbon Energy Corporation (each a United States public company),
and Cavell Energy Corporation (a Canadian public company), and certain
privately-owned companies in which affiliates of Yorktown Partners LLC hold
equity interests including PetroSantander Inc., Savoy Energy, L.P., Ricks
Exploration Inc., Athanor Resources Inc., Camden Resources, Inc., Crosstex
Energy Holdings Inc. and ESI Energy Services Inc.
Harold R. Logan, Jr., age 56, has been Executive Vice President, Treasurer
and a Director of TransMontaigne since April 1995 and Chief Financial Officer
since November 2000. From 1985 to 1994, Mr. Logan was Senior Vice
President/Finance and a director of Associated Natural Gas Corporation. Prior
to joining Associated Natural Gas Corporation, Mr. Logan was with Dillon, Read
& Co. Inc. and Rothschild, Inc. In addition, Mr. Logan is a director of
Suburban Propane Partners, L.P., Union Bankshares, Ltd., and Graphic Packaging
Corporation.
Edwin H. Morgens, age 60, was appointed a Director of TransMontaigne in June
1996. Mr. Morgens has been Chairman of Morgens, Waterfall, Vintiadis &
Company, Inc., an investment management firm, since 1970. In addition, Mr.
Morgens serves as a director of Programmer's Paradise, Inc.
Meetings and Certain Committees of the Board
During the fiscal year ended June 30, 2001, the Board of Directors met on
five occasions. No Director attended fewer than 75% percent of the aggregate
of the total number of meetings of the Board of Directors and
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the total number of meetings held by all committees of the Board on which he
served. The Board has Audit and Compensation Committees. In accordance with
the By-laws of the Company, the Board of Directors elects from its members the
members of each committee, who serve at the pleasure of the Board. The Board
of Directors, as a whole, is responsible for nominating Directors and has not
formed a committee for such purpose.
The Audit Committee is composed of three independent Directors, each of whom
is able to understand fundamental financial statements and at least one of
whom has past experience in accounting or related financial management
experience. The Audit Committee's duties and responsibilities are fully
discussed in the Report of the Audit Committee set forth in this Proxy
Statement. The members of the Audit Committee during the Company's fiscal year
ended June 30, 2001 were Bryan H. Lawrence Chairman, Peter B. Griffin and John
A. Hill. The members of the Audit Committee appointed to serve during the
Company's fiscal year ending June 30, 2002 are Bryan H. Lawrence, Chairman,
Peter B. Griffin and John A. Hill.
The Compensation Committee is composed entirely of independent Directors and
approves the salaries of the executive officers of the Company and administers
the Company's equity incentive plans, including the selection of the
individuals to be granted awards from among those eligible to participate. The
Company currently has three equity incentive plans: the TransMontaigne Inc.
Equity Incentive Plan (the "1997 Option Plan"), the TransMontaigne Oil Company
Employees' Stock Option Plan (the "1995 Option Plan") and the Amended and
Restated Employee Nonqualified Stock Option Plan (the "1991 Option Plan").
During the Company's fiscal year ended June 30, 2001, stock options and grants
of restricted stock were awarded. During the Company's fiscal year ended June
30, 2001, the Compensation Committee acted four times by unanimous written
consent. The members of the Compensation Committee during the Company's fiscal
year ended June 30, 2001 were Bryan H. Lawrence and Edwin H. Morgens. The
members of the Compensation Committee appointed to serve during the Company's
fiscal year ending June 30, 2002 are Bryan H. Lawrence, Chairman, and Edwin H.
Morgens. A Report of the Compensation Committee on Executive Compensation is
set forth in this Proxy Statement.
Compensation Of Directors
Employee Directors receive no additional compensation for services on the
Board of Directors or Committees of the Board. Directors who are not employees
were paid an annual fee of $18,000 through June 30, 2001, payable quarterly.
All Directors are reimbursed for reasonable out-of-pocket expenses incurred in
attending meetings of the Board or any Committee or otherwise by reason of
their being a Director.
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MANAGEMENT
The following table sets forth the names, ages and positions of the
executive officers of TransMontaigne:
Name Age Position
---- --- --------
Cortlandt S. Dietler................ 80 Chairman and Director
Donald H. Anderson.................. 53 Vice Chairman, Chief Executive
Officer, President and Director
Harold R. Logan, Jr................. 56 Executive Vice President, Chief
Financial Officer, Treasurer and
Director
William S. Dickey................... 43 Executive Vice President
Frederick W. Boutin................. 46 Senior Vice President
Erik B. Carlson..................... 54 Senior Vice President, Corporate
Secretary and General Counsel
Larry F. Clynch..................... 56 Senior Vice President
Rodney R. Hilt...................... 35 Vice President, Controller and Chief
Accounting Officer
See "Election of Directors" for additional information with respect to
Messrs. Dietler, Anderson and Logan.
William S. Dickey has been an Executive Vice President of TransMontaigne
since May 2000. Prior to his employment with TransMontaigne, Mr. Dickey was a
Vice President of TEPPCO from January 1999 until May 2000. Prior to joining
TEPPCO, Mr. Dickey was a Vice President and Chief Financial Officer of Duke
Energy Field Services from 1994 to 1998.
Frederick W. Boutin has been a Senior Vice President of TransMontaigne since
April 1995. Prior to his employment with TransMontaigne, Mr. Boutin was a Vice
President of Associated Natural Gas Corporation. Prior to joining Associated
Natural Gas Corporation in 1985, Mr. Boutin was with KPMG Peat Marwick LLP (a
predecessor to KPMG LLP).
Erik B. Carlson has been a Senior Vice President, Corporate Secretary and
General Counsel of TransMontaigne since January 1998. Prior to his employment
with TransMontaigne, Mr. Carlson served as Senior Vice President, General
Counsel and Corporate Secretary of Duke Energy Field Services, (formerly
Associated Natural Gas, Inc.), a wholly-owned subsidiary of Duke Energy
Corporation, since February 1983.
Larry F. Clynch has been a Senior Vice President of TransMontaigne since
November 15, 2000 and has been President of TransMontaigne Terminaling Inc.
and TransMontaigne Pipeline Inc. since January 1, 1997. Mr. Clynch joined a
subsidiary of TransMontaigne in January 1996 as Senior Vice President of
Operations. Prior to that time, Mr. Clynch was employed by Conoco Pipe Line
Company for 28 years where he most recently served as its President.
Rodney R. Hilt has been the Vice President, Controller and Chief Accounting
Officer since October 2000. Prior to his employment with TransMontaigne, Mr.
Hilt was Controller of TEPPCO Crude Oil from November 1998 to October 2000.
Prior to joining TEPPCO, Mr. Hilt was Director of Revenue Accounting for Duke
Energy Field Services from 1992 to 1998.
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OWNERSHIP OF COMMON STOCK
The following table sets forth certain information regarding the beneficial
ownership of Common Stock and Common Stock equivalents as of August 31, 2001
by each Director, by each individual serving as an executive officer as of
August 21, 2001 and who is named in the Summary Compensation table set forth
under "Executive Compensation" below, by each person known by TransMontaigne
to own more than 5% of the outstanding shares of Common Stock and by all
Directors and those serving as executive officers as of August 31, 2001 as a
group. The information set forth below is based solely upon information
furnished by such individuals or contained in filings made by such beneficial
owners with the Securities and Exchange Commission (the "SEC").
Number of
Beneficial Owner Shares (1)(2) Percent of Class
---------------- ------------- ----------------
Cortlandt S. Dietler (3) ....................... 2,200,566 6.9%
PO Box 5660
Denver, CO 80217
Donald H. Anderson (4).......................... 178,998 (5)
Harold R. Logan, Jr. (6)........................ 414,131 1.3%
William S. Dickey (7)........................... 125,329 (5)
Erik B. Carlson (8)............................. 109,916 (5)
Larry F. Clynch (9)............................. 80,802 (5)
First Reserve Corporation (10)
First Reserve Fund VI, Limited Partnership.... 4,130,473 13.0%
First Reserve Fund VII, Limited Partnership... 2,712,865 7.9%
First Reserve Fund VIII, LP................... 4,340,584 12.0%
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(Group Total)................................. 11,183,922 32.5%
Louis Dreyfus Corporation....................... 4,351,080 13.7%
Ten Westport Road
P.O. Box 810
Wilton, CT 06897
Merrill Lynch Investment Managers, L.P. (11).... 3,854,619 12.1%
Vencap Holdings (1987) Pte Ltd (12)............. 2,712,865 7.9%
c/o Government of Singapore Investment
Corporation
255 Shoreline Drive, Suite 600
Redwood City, CA 94065
Yorktown Partners LLC (13)
Yorktown Energy Partners III, L.P............. 2,170,292 6.4%
Yorktown Partners LLC ..................... .. 66,733 (5)
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(Group Total)................................. 2,237,025 6.6%
Vestar Capital Partners III, L.P. (14).......... 2,170,292 6.4%
c/o Vestar Capital Partners
1225 Seventeenth Street, Suite 1660
Denver, CO 80202
J.P. Morgan Chase & Co. (15)
Fleming US Discovery Fund III, L.P............ 1,870,465 5.6%
Fleming US Discovery Offshore Fund III, L.P... 299,826 (5)
----------
(Group Total)................................. 2,170,291 6.5%
J.P. Morgan Chase & Co.
1211 Avenue of the Americas, 38th Floor
New York, New York 10036
6
Number of
Beneficial Owner Shares (1)(2) Percent of Class
---------------- ------------- ----------------
Peter B. Griffin (16).......................... 4,351,080 13.7%
Louis Dreyfus Corporation
Ben A. Guill (17).............................. 11,183,922 28.8%
First Reserve Corporation
600 Travis, Suite 6000
Houston, TX 77002
John A. Hill (17).............................. 11,192,112 28.8%
First Reserve Corporation
475 Steamboat Road
Greenwich, CT 06830
Bryan H. Lawrence (13)......................... 77,246 (5)
Yorktown Partners LLC
410 Park Avenue
New York, NY 10022
Edwin H. Morgens (18).......................... 253,030 (5)
Morgens, Waterfall, Vintiadis & Company, Inc.
Swiss Bank Tower
10 E. 50th Street
New York, NY 10022
All Directors and Executive Officers as a Group 19,368,820 49.2%
(14 Persons) (19).............................
--------
(1) All shares are owned both of record and beneficially unless otherwise
specified by footnote to this table. Based solely upon information
furnished by such individuals or contained in filings made by such
beneficial owners with the SEC.
(2) Calculated pursuant to Rule 13d-3(d) of the Securities Exchange Act of
1934, as amended. Under Rule 13d-3(d), shares not outstanding that are
subject to options, warrants, rights, or conversion privileges
exercisable within sixty days of the date of this table (August 31, 2001)
are deemed outstanding for the purpose of calculating the number and
percentage owned by such person.
(3) Includes 2,000 shares, as to which Mr. Dietler disclaims beneficial
ownership, held by Mr. Dietler's spouse, 100,000 shares, 137,025 shares
and 80,004 shares issuable upon the exercise of outstanding options, the
conversion of Series A Preferred and the exercise of warrants,
respectively.
(4) Includes 8,000 shares issuable upon the exercise of outstanding options.
(5) Less than one percent.
(6) Includes 65,000 shares issuable upon the exercise of outstanding options.
(7) Includes 60,000 shares as to which Mr. Dickey disclaims beneficial
ownership, owned by DQ Investment Group, a family general partnership, of
which Mr. Dickey is a general partner. Includes 5,000 shares issuable
upon exercise of outstanding options.
(8) Includes 550 shares held in an IRA for Mr. Carlson's spouse, and 840
shares and 725 shares held in trust for Mr. Carlson's son and daughter,
respectively, all of which Mr. Carlson disclaims beneficial ownership.
(9) Includes 53,000 shares issuable upon the exercise of outstanding options.
(10) The number of shares shown as beneficially owned by First Reserve
Corporation ("First Reserve") consist of all the shares owned by First
Reserve Fund VI, Limited Partnership, First Reserve Fund VII, Limited
Partnership and First Reserve Fund VIII, LP (collectively the "First
Reserve Funds"). Includes 4,453,319 shares of Common Stock issuable upon
conversion of Series A Preferred and 2,600,130 shares issuable upon
exercise of warrants. First Reserve may be deemed to have beneficial
ownership of the shares of Common Stock held by the First Reserve Funds
because it is the general partner of each of the First Reserve Funds and
has voting and dispositive power over those shares. The address of First
Reserve and the First Reserve Funds is 411 West Putnam Avenue, Suite 109,
Greenwich, CT 06830.
(11) TransMontaigne has granted to Merrill Lynch Investment Managers, L.P.,
formerly known as Merrill Lynch Asset Management L.P., the right to
maintain its 15% ownership of Common Stock if TransMontaigne issues stock
in the future. Merrill Lynch & Co., Inc., a widely-held public company,
has sole voting and dispositive control over these shares. The address
for Merrill Lynch Investment Managers, L.P. is 800 Scudders Mill Road,
Plainsboro, NJ 08536.
(12) Comprised of 1,712,815 shares of Common Stock issuable upon conversion of
Series A Preferred and 1,000,050 shares issuable upon exercise of
warrants.
(13) Yorktown Partners LLC, as investment manager to Yorktown Energy Partners
III, L.P. and as agent through an irrevocable power of attorney, is
deemed to beneficially own an aggregate of 2,237,025 shares of Common
Stock comprised of 1,412,385 shares issuable upon conversion of Series A
Preferred and 824,640 shares issuable upon exercise of warrants. Yorktown
Partners LLC is an affiliate of Bryan H. Lawrence, a Director of
TransMontaigne. Mr. Lawrence owns 77,246 shares individually and
disclaims beneficial ownership of the Yorktown Partners LLC shares. The
address for Yorktown Partners LLC and Yorktown Energy Partners III, L.P.
is 410 Park Avenue, New York, NY 10022.
7
(14) Comprised of 1,370,252 shares of Common Stock issuable upon conversion of
Series A Preferred and 800,040 shares issuable upon exercise of warrants.
(15) The shares of Common Stock held by J.P. Morgan Chase & Co. are held by
the Fleming US Discovery Fund III, L.P. and Fleming US Discovery Offshore
Fund III, L.P. (collectively the "Fleming Funds") and are comprised of
1,370,251 shares of Common Stock issuable upon conversion of Series A
Preferred and 800,040 shares issuable upon exercise of warrants. J.P.
Morgan Chase & Co., investment advisor to the Fleming Funds, may be
deemed to have beneficial ownership of the shares of Common Stock held by
the Fleming Funds.
(16) Peter B. Griffin does not directly own any Common Stock. Mr. Griffin may
be deemed to have beneficial ownership of the shares of Common Stock held
by Louis Dreyfus Corporation because Mr. Griffin is President of Louis
Dreyfus Corporation, which owns 4,351,080 shares of Common Stock. Mr.
Griffin expressly disclaims beneficial ownership of these shares. Mr.
Griffin became a Director of the Company on July 1, 2000.
(17) The number of shares shown as beneficially owned by Mr. Guill includes
11,183,922 shares owned by the First Reserve Funds (10). Mr. Guill may be
deemed to have beneficial ownership of the shares held by the First
Reserve Funds because of his ownership of common stock of First Reserve
and his position as President of First Reserve. Mr. Guill expressly
disclaims beneficial ownership of these shares. The number of shares
shown as beneficially owned by Mr. Hill includes 8,190 shares directly
owned and 11,183,922 shares owned by the First Reserve Funds (10). Mr.
Hill may be deemed to have beneficial ownership over the shares held by
the First Reserve Funds because of his ownership of common stock of First
Reserve and his positions as Vice Chairman and Managing Director of First
Reserve. Mr. Hill expressly disclaims beneficial ownership of these
shares. Mr. Guill and Mr. Hill are Directors of the Company.
(18) Includes 199,806 shares, as to which Mr. Morgens disclaims beneficial
ownership, held by the Edwin Morgens and Linda Morgens 1993 Trust and
7,080 shares, as to which Mr. Morgens disclaims beneficial ownership,
held by the Lauren W. Morgens 1999 Trust.
(19) Of such 19,368,820 shares, (a) 280,000 represent shares issuable upon the
exercise of outstanding options, 4,590,344 represent shares issuable upon
the conversion of Series A Preferred at a price of $15 per share and
2,680,134 represent shares issuable upon the exercise of warrants at a
price of $14 per share, (b) 11,183,922 shares indicated as being owned by
First Reserve Corporation, and deemed beneficially owned by Mr. Guill and
Mr. Hill, are included only once in the aggregate number of shares held
by all Directors and executive officers as a group, (c) 4,351,080 shares
indicated as being owned by Louis Dreyfus Corporation, and deemed
beneficially owned by Mr. Griffin, are included only once in the
aggregate number of shares held by all Directors and executive officers
as a group, and (d) Directors and executive officers disclaim beneficial
ownership with respect to 15,798,923 shares.
8
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table sets forth certain information regarding compensation
earned during each of the Company's last three fiscal years by all individuals
serving as the Company's Chief Executive Officer and each of the Company's
four other most highly compensated executive officers based on salary and
bonus earned in the fiscal year ended June 30, 2001 (collectively, the "Named
Executive Officers").
Long Term
Annual Compensation Compensation Awards
--------------------------- ------------------------
Securities Restricted
Name and Principal Other Annual Underlying Stock All Other
Position Year Salary(1) Compensation Options(#) Awards($) Compensation(2)
------------------ ---- --------- ------------ ---------- ---------- ---------------
Donald H. Anderson (3).. 2001 $301,538 $ -- 50,000 $ 142,500(4) $4,500
Vice Chairman of the 2000 254,615 -- 330,000(4) 1,202,500(5) 1,177
Board, Chief Executive 1999 -- -- -- -- --
Officer and President
Harold R. Logan, Jr..... 2001 200,000 -- 30,000 95,000(6) 5,250
Executive Vice 2000 200,000 -- -- 102,500(7) 4,800
President, Chief 1999 180,000 -- 81,200(6) -- 4,846
Financial Officer and
Treasurer
William S. Dickey (8)... 2001 225,000 -- 50,000 47,500(8) 3,375
Executive Vice 2000 18,173 -- 50,000 362,500(8) --
President 1999 -- -- -- -- --
Erik B. Carlson (9)..... 2001 200,000 -- 30,000 133,475(9) 4,519
Senior Vice President, 2000 200,000 -- -- 76,875(10) 4,800
General Counsel and 1999 205,650 -- 91,900(9) -- 4,894
Secretary
Larry F. Clynch (11).... 2001 238,846 14,922 25,000 95,000(12) 5,400
Senior Vice President 2000 230,231 31,866 30,000 -- 4,800
1999 215,001 4,758 41,200(12) -- 4,650
--------
(1) Amounts shown set forth all cash compensation earned by each of the Named
Executive Officers in the years shown, including salaries deferred under
the TransMontaigne Inc. Savings and Profit Sharing Plan (the "401(k)
Plan") pursuant to Section 401(k) of the Internal Revenue Code. No
bonuses were paid during any of the periods presented.
(2) Amounts shown set forth the Company's matching contributions to the
Company's 401(k) Plan.
(3) Mr. Anderson became an employee of the Company September 28, 1999, became
the Chief Executive Officer on October 1, 1999 and President on January
4, 2000.
(4) Represents 30,000 shares of restricted stock on granted October 15, 2000
when the market price was $4.75. The grant of 30,000 shares was made in
connection with the underwater stock option/restricted stock exchange
program (the "Exchange Program") more fully explained in the Report of
the Compensation Committee. 250,000 of the 330,000 options granted during
fiscal year 2000 were cancelled on October 15, 2000 in exchange for the
30,000 shares of restricted stock. The restricted stock award vests 10%
after the first year, 20% after the second year, 30% after the third year
and 40% after the fourth year of continuous employment since the grant
date.
(5) Represents two grants of restricted stock at the market price of the
stock on the date of each grant: 100,000 shares granted on September 28,
1999 when the market price was $11.00, and 20,000 shares granted on
February 16, 2000 when the market price was $5.125. Each restricted stock
award vests 10% after the first year, 20% after the second year, 30%
after the third year and 40% after the fourth year of continuous
employment since each grant date.
(6) Represents 20,000 shares of restricted stock granted on October 15, 2000
when the market price was $4.75. 18,400 of the 20,000 shares were granted
in connection with the Exchange Program to cancel 101,200 underwater
options, including canceling the 81,200 options granted during fiscal
year 1999. The restricted stock award vests 10% after the first year, 20%
after the second year, 30% after the third year and 40% after the fourth
year of continuous employment since the grant date.
(7) Represents 20,000 shares of restricted stock granted on February 16, 2000
when the market price was $5.125 on the date of the grant. The restricted
stock award vests 10% after the first year, 20% after the second year,
30% after the third year and 40% after the fourth year of continuous
employment since the grant date.
(8) Mr. Dickey became an employee of the Company on May 26, 2000. The
restricted stock award in fiscal year 2001 represents 10,000 shares of
restricted stock granted on October 15, 2000 when the market price was
$4.75. The restricted stock award in fiscal year 2000 represents a grant
of 50,000 shares of restricted stock when the market price was $7.25 on
the date of the grant. The restricted stock awards vest 10% after the
first year, 20% after the second year, 30% after the third year and 40%
after the fourth year of continuous employment since the grant date.
9
(9) The restricted stock award in fiscal year 2001 represents a grant of
28,100 shares of restricted stock on October 15, 2000 when the market
price was $4.75. The 28,100 shares were granted in connection with the
Exchange Program to cancel 166,900 underwater options, including
canceling 91,900 options granted during fiscal year 1999. The restricted
stock awards vest 10% after the first year, 20% after the second year,
30% after the third year and 40% after the fourth year of continuous
employment since the grant date.
(10) The restricted stock awards in fiscal year 2000 represent a grant of
15,000 shares of restricted stock on February 16, 2000 when the market
price was $5.125 on the date of the grant. The restricted stock grants
vest 10% after the first year, 20% after the second year, 30% after the
third year and 40% after the fourth year of continuous employment since
the grant date.
(11) The other 2001, 2000 and 1999 annual compensation for Mr. Clynch consists
of reimbursement for certain relocation expenses of $14,922, $31,866 and
$4,758, respectively.
(12) Represents 20,000 shares of restricted stock granted on October 15, 2000
when the market price was $4.75. 10,000 of the 20,000 shares were granted
in connection with the Exchange Program to cancel 61,200 underwater
options, including canceling the 41,200 options granted during fiscal
year 1999. The restricted stock awards vest 10% after the first year, 20%
after the second year, 30% after the third year and 40% after the fourth
year of continuous employment since the grant date.
Option Grants In Last Fiscal Year
The following table contains information about stock options granted to the
Named Executive Officers under the 1997 Option Plan during the fiscal year
ended June 30, 2001.
Potential Realizable Value at
Assumed Annual Rates of Stock
Price Appreciation for Option
Individual Grants Term (10 Years)(1)
--------------------------------------------- ------------------------------
Number of % of Total
Securities Options
Underlying Granted to Exercise or 10%
Options Employee in Base Price Expiration 5% Aggregate Aggregate
Name Granted(2) Fiscal Year ($/Share) Date Value(3) Value(3)
---- ---------- ----------- ----------- ---------- -------------- --------------
Donald H. Anderson...... 50,000 6.67% $3.75 04/15/2011 $117,918 $298,827
Harold R. Logan, Jr..... 30,000 4.00% 3.75 04/15/2011 70,751 179,296
William S. Dickey....... 50,000 6.67% 3.75 04/15/2011 117,918 298,827
Erik B. Carlson......... 30,000 4.00% 3.75 04/15/2011 70,751 179,296
Larry F. Clynch......... 25,000 3.33% 3.75 04/15/2011 58,959 149,413
--------
(1) The dollar gains under these columns result from calculations assuming 5%
and 10% growth rates as set by the SEC and are not intended to forecast
future price appreciation of the Company's Common Stock. The gains reflect
a future value based upon growth at these prescribed rates. The Company
did not use an alternative formula for a grant date valuation, an approach
which would state gains at present, and therefore lower, value. The
Company is not aware of any formula that will determine with reasonable
accuracy a present value based on future unknown or volatile factors. It
is important to note that options have value to recipients, including the
Named Executive Officers and to other option recipients, only if the stock
price advances beyond the grant date price shown in the table during the
effective option period.
(2) These awards were made pursuant to the 1997 Option Plan. Under the 1997
Option Plan, the option price must be not less than 100% of the fair
market value of Company's Common Stock on the date the option is granted.
The fair market value of a share of Company's Common Stock is the
officially listed closing price of the Company Common Stock on the
American Stock Exchange on the date of grant. All unexercisable stock
options granted under the 1997 Option Plan become exercisable upon a
change in control. The stock options granted on April 16, 2001 have an
exercise price equal to $3.75 per share and vest 10% on April 15, 2002;
20% on April 15, 2003; 30% on April 15, 2004, and 40% on April 15, 2005.
The 1997 Option Plan allows shares of the Company's Common Stock to be
used to satisfy any resulting Federal, state and local tax liabilities,
but does not provide for a cash payment by the Company for income taxes
payable as a result of the exercise of a stock option award.
(3) Not discounted to present value.
10
Aggregated Option Exercises In Last Fiscal Year And Fiscal Year End Option
Values
There were no options exercised by any of the Named Executive Officers
during the fiscal year ended June 30, 2001. The following table provides
information with respect to the value as of June 30, 2001 of unexercised in-
the-money options held by the Named Executive Officers. The value of
unexercised in-the-money options at the fiscal year end is calculated using
the difference between the option exercise price and the fair market value of
the Company's Common Stock at June 30, 2001.
Number of
Securities Underlying Value of Unexercised
Unexercised Options In-the-Money Options at
at Fiscal Year-End (#) Fiscal Year-End ($)
------------------------- -------------------------
Name Exercisable Unexercisable Exercisable Unexercisable
---- ----------- ------------- ----------- -------------
Donald H. Anderson......... 8,000 122,000 7,000 175,500
Harold R. Logan, Jr........ 65,000 30,000 32,500 67,500
William S. Dickey.......... -- 50,000 -- 112,500
Erik B. Carlson............ -- 30,000 -- 67,500
Larry F. Clynch............ 53,000 52,000 65,625 79,875
An option is "in-the-money" on a particular date if the market value of the
underlying Common Stock on that date exceeds the option exercise price.
Employment Contracts And Termination Of Employment And Change In Control
Agreements
With the authorization and approval of the Board of Directors, the Company
has entered into Change in Control Agreements with certain executive officers
and key employees of the Company and its subsidiaries, including the named
executive officers listed in the Summary Compensation Table (the "Named
Executive Officer"). The agreements are for an initial term of three years,
from April 12, 2001 to April 11, 2004, after which they automatically renew
each April 12 for consecutive one year periods, unless terminated by either
party upon ninety days prior notice, provided, that notwithstanding any such
notice, the agreement will continue in effect for twenty-four months in the
event an actual or threatened change in control (as defined in the agreement)
occurs during the initial term or any extension thereof. The agreements
provide that if the Named Executive Officer is terminated other than for cause
during the term of the agreement, or within two years after a change in
control of the Company, or if the Named Executive Officer terminates his
employment for good reason within such time period, the Named Executive
Officer is entitled to receive a lump-sum severance payment equal to a
multiple varying from 1 to 2 times the sum of such Named Executive Officer's
annual salary and target bonus, as then in effect, together with certain other
payments and benefits, including continuation of employee welfare benefits. In
addition, should the Named Executive Officer be subject to the excise tax on
excess parachute payments as a result of such payment and payments under other
plans due to a change in control, an additional payment will be made to
restore the after-tax severance payment due the Named Executive Officer to the
same amount which the Named Executive Officer would have retained had the
excise tax not been imposed.
Report of the Compensation Committee
The Compensation Committee is responsible for the Company's executive
compensation program, the purpose of which is to enable the Company to
attract, retain and motivate the executive personnel deemed necessary to
maximize return to stockholders. The fundamental concept of the program is to
align the amount of an executive's total compensation with his contribution to
the success of the Company in creating stockholder value. The Compensation
Committee's duties include the annual review and approval of the compensation
of the Chief Executive Officer, review and determination of individual
elements of compensation for the Company's other executive officers,
administration of long-term incentive plans for management, including the
selection of the individuals to be granted awards from among those eligible to
participate. At present, the executive compensation program is comprised of
salary, long-term incentive opportunities in the form of stock options and
11
restricted stock awards, cash bonuses based upon the financial performance of
the Company and employee welfare benefits typically offered.
Base Salaries. The factors considered in determining base compensation
levels for the Chief Executive Officer and the Company's other executive
officers included the goals outlined above and were evaluated by the
Compensation Committee to be consistent with competitive practices (including
companies with comparable market valuations, lines of business and/or
revenues) and level of responsibility. Based upon the Company's overall
financial performance during the previous fiscal year, including lower than
anticipated revenues and profits, as well as the market underperformance of
the Company's Common Stock, the Compensation Committee, in discussions with
Mr. Anderson, President and Chief Executive Officer of the Company, determined
that the base salaries of executive officers and all other officers and key
employees of the Company earning $75,000 or more on an annual basis would be
frozen, subject to further review in fiscal year 2002. In addition, effective
January 10, 2000, the Company's Chairman, Mr. Dietler, voluntarily reduced his
annual salary for the remainder of the fiscal year from $200,000 to $120,000
per year. Further, prior to the close of the fiscal year, and in association
with other cost reduction and restructuring initiatives undertaken by the
Company to reduce overall general and administrative expenses and improve
financial performance, Mr. Anderson, effective July 10, 2000, voluntarily
reduced his annual salary from $340,000 to $300,000 per year.
Cash Bonuses. Given the overall financial performance of the Company during
the previous fiscal year, no cash bonuses were awarded to the Company's
executive officers.
Long-Term Incentives. The Compensation Committee believes that long-term
compensation should comprise a substantial portion of each executive officer's
total compensation. Long-term compensation provides incentives that encourage
the executive officers to own and hold the Company's stock and tie their long-
term economic interests directly to those of the Company's stockholders and
rewards executives for improved performance by the Company. To date, the only
long-term compensation available for use by the Compensation Committee has
been the grant of awards of stock options and shares of restricted stock.
The Compensation Committee approved certain grants of restricted stock, as
well as awards of non-qualified stock options to certain executive officers
and key employees of the Company and its subsidiaries in order to align the
equity incentive awards of such executive officers and key employees with
other members of their peer group within the Company and its subsidiaries. The
grant of restricted stock to certain executive officers and key employees of
the Company and its subsidiaries was effective as of October 15, 2000, with a
vesting schedule over a period of four years from the grant date. The award of
non-qualified stock options to certain executive officers and key employees of
the Company and its subsidiaries was effective as of April 16, 2001, with a
vesting schedule over a period of four years from the award date.
Option Exchange Program. On September 28, 2000, based upon management's
review of the status of stock options previously awarded to executive officers
and key employees of the Company and its subsidiaries, the Board determined
that the majority of such stock options had an exercise price significantly in
excess of the current market price of the Company's Common Stock, which was
$4.81 per share as of September 27, 2000 and therefore did not currently
provide the incentive to the recipients that was originally intended, because
such stock options were not likely to be exercised in the foreseeable future.
Therefore, in order to provide renewed financial incentive to current
executive officers and key employees of the Company and its subsidiaries, the
Compensation Committee approved an exchange program (the "Exchange Program").
Under the Exchange Program, current executive officers and key employees of
the Company and its subsidiaries would be provided a one-time opportunity to
submit for cancellation that portion of the their stock options which had an
exercise price in excess of $7.25 per share in exchange for a grant by the
Company of a number of shares of restricted stock as determined by the Company
and as approved by the Compensation Committee. The grant of restricted stock
under the Exchange Program was effective as of October 15, 2000, with a
vesting schedule over a period of four years from the grant date.
12
During the fiscal year ended June 30, 2001, the Compensation Committee
awarded 512,680 shares of restricted stock. Of that amount, 261,280 shares
were issued to executive officers and key employees of the Company in exchange
for the cancellation of 1,681,300 stock options with exercise prices ranging
from $11.00 to $17.25 per share, which had been issued to the executive
officers and key employees in prior years.
Under current interpretations issued by the Securities and Exchange
Commission, the cancellation of underwater or out of the money stock options
and the exchange of restricted stock therefor is required to be disclosed
under Proxy Statement rules as a repricing. Therefore, the Company presents
the following information in the tabular format required by Proxy Statement
rules, which discloses the out of the money stock options cancelled by
executive officers of the Company and the shares of restricted stock exchanged
therefor. For financial reporting purposes, the exchange was not accounted for
as a repricing.
Ten-Year Option/SAR Repricings
Option Exchange Program--October 15, 2000
Number of Length of
restricted original
shares option
Number of Market granted in term
securities price of Exercise exchange remaining
underlying stock at price at at $0.0 at the
Date of options time of time of exercise date of
Name and Principal the repriced repricing repricing price the
Position repricing (#) ($) ($) (#) (1) repricing
------------------ ---------- ---------- --------- --------- ---------- ---------
Donald H. Anderson...... 10/15/2000 250,000 $4.75 $11.00 30,000 9.0 years
Vice Chairman of the
Board, Chief Executive
Officer and President
Harold R. Logan, Jr..... 10/15/2000 20,000 $4.75 $17.25 6.9 years
Executive Vice 10/15/2000 8,000 $4.75 $13.50 7.8 years
President, Chief 10/15/2000 73,200 $4.75 $11.00 8.4 years
Financial Officer and ------- ------
Treasurer 101,200 18,400
William S. Dickey....... 10/15/2000 -- --
Executive Vice
President
Erik B. Carlson......... 10/15/2000 75,000 $4.75 $15.00 7.2 years
Senior Vice President, 10/15/2000 4,000 $4.75 $13.50 7.8 years
General Counsel and 10/15/2000 87,900 $4.75 $11.00 8.4 years
Secretary ------- ------
166,900 28,100
Larry F. Clynch......... 10/15/2000 20,000 $4.75 $17.25 6.9 years
Senior Vice President 10/15/2000 8,000 $4.75 $13.50 7.8 years
10/15/2000 33,200 $4.75 $11.00 8.4 years
------- ------
61,200 10,000
J. A. Alexander......... 10/15/2000 60,000 $4.75 $11.00 12,600 8.4 years
Chief Information
Officer
Frederick W. Boutin..... 10/15/2000 16,000 $4.75 $17.25 6.9 years
Senior Vice President, 10/15/2000 8,000 $4.75 $13.50 7.8 years
Corporate Planning 10/15/2000 71,000 $4.75 $11.00 8.4 years
------- ------
95,000 17,600
Cortlandt S. Dietler.... 10/15/2000 20,000 $4.75 $17.25 6.9 years
Chairman 10/15/2000 8,000 $4.75 $13.50 7.8 years
10/15/2000 183,200 $4.75 $11.00 8.4 years
------- ------
211,200 15,000
13
Ten-Year Option/SAR Repricings (continued)
Option Exchange Program--October 15, 2000
Number of Length of
restricted original
shares option
Number of Market granted in term
securities price of Exercise exchange remaining
underlying stock at price at at $0.0 at the
options time of time of exercise date of
Name and Principal Date of the repriced repricing repricing price the
Position repricing (#) ($) ($) (#) (1) repricing
------------------ ----------- ---------- --------- --------- ---------- ---------
Richard C. Eaton........ 10/15/2000 75,000 $4.75 $11.00 9.0 years
Senior Vice President, 10/15/2000 50,000 $4.75 $11.00 8.4 years
TransMontaigne Product --------- -------
Services Inc. 125,000 26,300
Mark S. Huff............ 10/15/2000 15,000 $4.75 $15.00 7.1 years
Vice President of 10/15/2000 6,000 $4.75 $13.50 7.8 years
Business Development 10/15/2000 12,900 $4.75 $11.00 8.4 years
--------- -------
33,900 5,400
--------- -------
Total Executive
Officers............... 1,104,400 163,400
========= =======
Total Option Exchange
Program................ 1,681,300 261,280
========= =======
--------
(1) The restricted stock awards vest 10% after the first year, 20% after the
second year, 30% after the third year and 40% after the fourth year of
continuous employment commencing on the date of grant, at no cost to the
employee.
Other. In addition, the executive officers participate in the Company's
401(k) Plan, which consists of elective employee salary reduction
contributions and a Company match equal to 50% of employee contributions on
the first 6% of employee compensation contributed.
The Compensation Committee has reviewed the limitation on the deductibility
of compensation for federal income tax purposes pursuant to Section 162(m) of
the Internal Revenue Code, as amended. The Compensation Committee does not
anticipate awarding levels of compensation that result in such limitation. The
Compensation Committee may authorize compensation in the future that results
in amounts above the limit if it determines that such compensation is in the
best interests of the Company. In addition, the limitation may affect the
future grant of stock options.
Compensation Committee
Bryan H. Lawrence, Chairman
Edwin H. Morgens
Compensation Committee Interlocks and Insider Participation
At June 30, 2001, the Compensation Committee of the Board of Directors
consisted of Bryan H. Lawrence and Edwin H. Morgens. During the fiscal year
ended June 30, 2001, there were no Compensation Committee interlocks between
the Company and any other entity.
14
Performance Graph
The graph set forth below provides an indicator of cumulative total
stockholder returns on an investment of $100 in shares of Common Stock as
compared to an investment of $100 in the S&P 500 Stock Index and a "peer
group" index over the period beginning April 30, 1996 and ending June 30,
2001.
[PERFORMANCE GRAPH]
4/30/96 4/30/97 4/30/98 6/30/98 6/30/99 6/30/00 6/30/01
-------------------------------------------------------------------------------------
TransMontaigne $ 100.00 $ 256.52 $ 254.35 $ 258.70 $ 218.48 $ 106.52 $ 100.87
-------------------------------------------------------------------------------------
S & P 500 $100.00 $125.13 $176.52 $215.04 $236.82 $206.10 $202.43
-------------------------------------------------------------------------------------
Peer Group (1) $100.00 $128.71 $188.10 $200.97 $243.44 $242.07 $214.99
--------
(1) The peer group consists of the following issuers, each of which has been
weighted according the respective issuer's stock market capitalization at
the beginning of each period for which a return is indicated according to
SEC requirements: Buckeye Partners, L.P., TEPPCO Partners, L.P., Kaneb
Pipe Line Partners, L.P., The Williams Companies, Inc., Western Gas
Resources, Inc. and GATX Corporation.
Certain Relationships and Related Transactions
Harold R. Logan, Jr., the Executive Vice President, Chief Financial Officer,
Treasurer and a Director of the Company, is also a Director of Lion Oil
Company, in which a 65% owned subsidiary of the Company owns 27.75%, resulting
in an effective 18.04% ownership interest. The Company purchased $61,444,543
of refined petroleum products from and sold $1,112,952 of refined petroleum
products to Lion Oil Company in the year ended June 30, 2001, all of which
product purchases were made at market prices negotiated between the Company
and Lion Oil Company or through independent brokers. The Company received
$583,407 throughput revenue and $270,059 additive revenue from Lion Oil
Company in the year ended June 30, 2001. The Company believes the prices paid
by and to Lion Oil Company were comparable to prices that would have been paid
by and to independent third parties.
15
Pursuant to a private placement agreement (i) First Reserve Fund VI, Limited
Partnership and other partnerships managed by First Reserve Corporation,
Yorktown Energy Partners, L.P. and other venture capital funds managed by, and
shares owned by, officers of Dillon, Read & Co. Inc., and Waterwagon & Co.,
nominee for Merrill Lynch Growth Fund for Investment and Retirement, have the
right to require the Company to register their shares under the Securities Act
of 1933; and (ii) the Company agreed to take all action necessary to cause two
Directors designated by affiliates of First Reserve Corporation from time to
time to be elected to the Company's Board of Directors so long as their
collective ownership in the Company is at least 10%. The affiliates of First
Reserve Corporation have designated Ben A. Guill and John A. Hill as their
nominees for Directors.
Pursuant to a stock purchase agreement between the Company and Louis Dreyfus
Corporation ("Dreyfus"), the Company agreed to take all action necessary to
cause one Director designated by Dreyfus from time to time to be elected to
the Company's Board of Directors as long as its ownership in the Company is at
least 10%. Dreyfus has designated Peter B. Griffin as its nominee for
Director. Pursuant to a registration rights agreement entered into between the
Company and Dreyfus contemporaneously with the stock purchase agreement,
Dreyfus and each entity at least eighty percent owned, directly or indirectly
by S.A. Louis Dreyfus et Cie., has the right to require the Company to
register their shares under the Securities Act of 1933.
See "Compensation Committee Interlocks and Insider Participation" for a
description of additional related party transactions.
Report of the Audit Committee
The Audit Committee operates under a written charter adopted by the Board of
Directors, a copy of which is attached to this proxy statement as Exhibit A.
The responsibilities of the Committee, as reflected in its charter, are
intended to be in accordance with applicable requirements for corporate audit
committees. The Committee reviews and assesses the adequacy of its charter on
an annual basis.
As described more fully in its charter, the purpose of the Audit Committee
is to assist the Board of Directors in its general oversight of the Company's
financial reporting, internal control and compliance processes. Management is
responsible for the preparation, presentation and integrity of the Company's
financial statements, accounting and financial reporting principles, internal
controls and procedures designed to ensure compliance with accounting
standards, applicable laws and regulations. KPMG LLP, the Company's
independent auditing firm, is responsible for performing an independent audit
of the consolidated financial statements in accordance with generally accepted
auditing standards.
At four meetings during the fiscal year ended June 30, 2001, the Audit
Committee met with the independent auditors, as well as with Company officers
and employees who are responsible for financial reporting, accounting,
internal controls, and legal matters. In addition to its other
responsibilities, the Audit Committee recommends the appointment of the
independent auditors to the Board of Directors, and reviews the scope of and
fees related to the audit. The Audit Committee monitors the activities and
performance of the Company's external auditors, auditor independence matters
and the extent to which the independent auditor may be retained to perform
non-audit services. The Audit Committee and the Board have ultimate authority
and responsibility to select, evaluate and, when appropriate, replace the
Company's independent auditor.
The Audit Committee also reviews the results of the external audit work with
regard to the adequacy and appropriateness of the Company's financial,
accounting and internal controls. Management and independent auditor
presentations to and discussions with the Audit Committee also cover various
topics and events that may have significant financial impact or are the
subject of discussions between management and the independent auditor.
Management has represented to the Audit Committee that the Company's
consolidated financial statements were prepared in accordance with generally
accepted accounting principles, and the Audit Committee has
16
reviewed and discussed the audited consolidated financial statements with
management and the independent auditors. The Audit Committee discussed with
the independent auditors matters required to be discussed by Statement on
Auditing Standards No. 61 (Communication with Audit Committees). The Company's
independent auditors have provided to the Audit Committee written disclosures
required by Independence Standards Board Standard No. 1 (Independence
Discussions with Audit Committees), and the Audit Committee has discussed with
the independent auditors that firm's independence.
Based upon the Audit Committee's discussion with management and the
independent auditors and the Audit Committee's review of the representation of
management and the report of the independent auditors to the Audit Committee,
the Audit Committee recommended that the Board of Directors include the
audited consolidated financial statements in the Company's Annual Report on
Form 10-K for the year ended June 30, 2001 filed with the Securities and
Exchange Commission.
In accordance with the rules of the Securities and Exchange Commission, the
foregoing information, which is required by paragraphs (a) and (b) of
Regulation S-K Item 306, shall not be deemed to be "soliciting material," or
to be "filed" with the Commission or subject to the Commission's Regulation
14A, other than as provided in that Item, or to the liabilities of section 18
of the Securities Exchange Act of 1934, as amended, except to the extent that
the Company specifically requests that the information be treated as
soliciting material or specifically incorporates it by reference into a
document filed under the Securities Act of 1933, as amended, or the Securities
Exchange Act of 1934, as amended.
Audit Committee:
Bryan H. Lawrence (Chairman)
Peter B. Griffin
John A. Hill
Audit Fees:
During fiscal year 2001, the Company retained its principal auditor, KPMG
LLP, to provide services in the following categories and amounts:
Principal Auditor Fees: $0.4 million
All Other Fees: (1) $0.1 million
--------
(1) Other fees primarily related to work performed in connection with
registration statements, review of other SEC filings and various statutory
or non-statutory audits.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
executive officers and directors, and persons who own more than ten percent of
a registered class of the Company's equity securities (collectively,
"Reporting Persons") to file with the SEC and the American Stock Exchange
initial reports of ownership and reports of changes in ownership of the Common
Stock and other equity securities of the Company. Reporting Persons are also
required by SEC regulations to furnish the Company with copies of all Section
16(a) reports they file.
To the Company's knowledge, based solely on a review of the copies of such
reports furnished to the Company and written representations that no other
reports were required during the fiscal year ended June 30, 2001, all Section
16(a) filing requirements applicable to such Reporting Persons were complied
with.
17
ANNUAL REPORT
THE ANNUAL REPORT ON FORM 10-K OF THE COMPANY FOR THE FISCAL YEAR ENDED JUNE
30, 2001 ACCOMPANIES THIS PROXY STATEMENT AND WAS FILED ELECTRONICALLY WITH
THE SECURITIES AND EXCHANGE COMMISSION. THE 2001 ANNUAL REPORT, WHICH INCLUDES
AUDITED FINANCIAL STATEMENTS, DOES NOT FORM ANY PART OF THE MATERIALS FOR THE
SOLICITATION OF PROXIES. STOCKHOLDERS WHO WISH TO OBTAIN, WITHOUT CHARGE, A
COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K (WITHOUT EXHIBITS) SHOULD
ADDRESS A WRITTEN REQUEST TO ERIK B. CARLSON, SECRETARY, TRANSMONTAIGNE INC.,
370 17TH STREET, SUITE 2750, DENVER, COLORADO 80202. THE COMPANY WILL PROVIDE
COPIES OF THE EXHIBITS TO THE ANNUAL REPORT ON FORM 10-K UPON PAYMENT OF A
REASONABLE FEE.
STOCKHOLDER PROPOSALS AND OTHER MATTERS
Any proposal intended to be presented by a stockholder at the 2002 Annual
Meeting of Stockholders must be received by the Secretary of the Company at
the Company's principal office no later than June 14, 2002 in order to be
considered for inclusion in the Company's Proxy Statement and form of Proxy
for that meeting. For any proposal a stockholder wishes to bring before the
2002 Annual Meeting of Stockholders but for which such stockholder does not
seek to have a written proposal included in the Company's Proxy Statement
relating to such meeting, if the Company does not receive notice of such
proposal on or prior to June 14, 2002, the proxies solicited on behalf of the
Company's Board of Directors will confer discretionary authority to vote with
respect to such proposal.
The Board of Directors knows of no other business to be presented at the
Annual Meeting, but if other matters do properly come before the Annual
Meeting, it is intended that the persons named in the proxies will have
discretionary authority to vote the shares thereby represented in accordance
with their best judgment.
THE ENCLOSED PROXY SHOULD BE COMPLETED, DATED, SIGNED AND RETURNED IN THE
ENCLOSED POSTAGE-PAID ENVELOPE. PROMPT MAILING OF THE PROXY WILL BE
APPRECIATED.
By Order of the Board of Directors
/S/ Erik B. Carlson
Erik B. Carlson
Secretary
October 12, 2001
18
EXHIBIT A
Charter of the Audit Committee of the Board of Directors
Of
TransMontaigne Inc.
May 2000
I. Function and Purpose
The Audit Committee ("Committee") is a standing Committee of the Board of
Directors ("Board") of TransMontaigne Inc. ("Company"), the members of which
Committee shall be appointed by the Board. The primary function of the
Committee shall be to assist the Board in fulfilling its oversight
responsibilities to the Company's stockholders and to the investment community
relating to the Company's auditing, accounting and financial reporting
practices, as well as the quality and integrity of the Company's financial
reports. Consistent with this function, the Committee shall encourage
continuous improvement of, and foster adherence to, the Company's policies,
procedures and practices at all levels. To this end, the Committee shall:
. Monitor the integrity of the Company's financial reporting process and
systems of internal controls regarding financial disclosure and
accounting.
. Monitor the independence and performance of the Company's independent
outside accountants and the Company's internal audit department.
. Provide a direct, free and open avenue of communication among the
independent outside accountants, management, the Company's internal audit
department, and the Board.
. Report Committee actions through its Chairman to the Board with such
recommendations as the Committee may deem appropriate on significant
results of the foregoing activities.
The Committee shall have the ability to retain, at the Company's expense,
special legal, accounting and other consultants, or experts which the
Committee shall deem necessary in the performance of its duties. Given the
size and complexity of the Company, the Committee shall apply reasonable
materiality standards to all of its activities. While the Committee shall have
the authority to conduct any investigation appropriate to fulfilling its
responsibilities, and shall have direct access to the independent outside
accountants, as well as anyone in the Company, it is not the duty of the
Committee to conduct investigations to resolve disagreements, if any, between
management and the independent outside accountants or to assure compliance
with laws and regulations related to the audit and financial reporting
process.
II. Composition and Meetings
Committee members shall meet the independence, accounting and financial
literacy and other qualifications established by the American Stock Exchange.
The Committee shall be comprised of three or more, but not more than six
members of the Board, as determined by the Board, each of whom shall be
independent non-executive directors, free from any relationship that would
interfere with the exercise of his or her independent judgment. All members of
the Committee must have a basic understanding of finance and accounting and be
able to read and understand fundamental financial statements, and at least one
member of the Committee must have past employment experience in finance or
accounting, requisite professional certification in accounting, or any other
comparable experience or background that results in the individual's financial
sophistication, including being or having been a chief executive officer,
chief financial officer or other senior officer with financial oversight
responsibilities.
If a Committee Chairman is not designated or present, the members of the
Committee may designate a Chairman by majority vote of the Committee
membership. The Committee shall meet at least four times annually, such
meetings to coincide with the quarterly meetings of the Board, and may meet
more frequently if circumstances dictate. At least two members of the
Committee must be present to establish a quorum to properly convene a meeting.
The Committee Chairman shall prepare, in consultation with Company management,
other
1
Committee members and the independent outside accountants, an agenda in
advance of each meeting. The Committee shall meet privately in executive
session at least annually, if not at every meeting, with Company management,
its Chief Accounting Officer, the independent outside accountants, and as a
committee to discuss any matters that the Committee or each of these groups
believe should be discussed. In addition, the Committee, or at least its
Chairman, shall communicate with management and the independent outside
accountants quarterly to review the Company's financial statements and
significant findings based upon the independent outside accountants' limited
review procedures. The Committee shall maintain formal minutes of meetings of
the Committee, which shall be distributed to the Committee members and filed
with the Corporate Secretary. The Committee Chairman shall provide periodic
oral reports to the Board.
III. Responsibilities and Duties
Review Procedures
1. After initially submitting the Charter to the Board for approval, the
Committee shall review and reassess the adequacy of this Charter at
least annually. The Committee shall also make recommendations to the
Board for changes to the Charter, as conditions dictate and have the
document published at least once every three years in accordance with
Securities and Exchange Commission ("SEC") regulations.
2. The Committee will review the Company's annual audited financial
statements prior to filing or distribution. This review shall include a
discussion with management and the independent outside accountants
concerning significant issues regarding accounting principles,
practices, and judgments in accordance with AICPA Statement of Auditing
Standards ("SAS") No. 61 and should include any significant reserves,
accruals or estimates, which may have a material impact on the financial
statements.
3. In consultation with management and the independent outside accountants
and the Company's internal audit department and after discussion with
the independent outside accountants, the Committee shall consider the
integrity of Company's financial reporting processes and controls, and
discuss significant financial risk exposures and the steps management
has taken to monitor, control, and report such exposures. The Committee
shall also review significant findings prepared by the independent
outside accountants and the Company's internal audit department,
together with management's responses, including the status of previous
recommendations.
4. The Committee shall review with management and the independent outside
accountants the Company's quarterly financial results prior to the
release of earnings and/or the Company's quarterly financial statements
prior to filing or distribution. As part of this review, the Committee
shall discuss any significant changes to the Company's accounting
principles and any items required to be communicated by the independent
outside accountants in accordance with SAS No. 61.
5. The Committee shall review, prior to submission, all certification
letters and other documents that the Company may be required to submit
to the American Stock Exchange concerning the composition of the
Committee, this Charter or related matters.
Independent Outside Accountants
6. The independent outside accountants are ultimately accountable to the
Committee and the Board. The Committee shall review the performance of
these accountants and annually recommend to the Board the appointment of
the independent outside accountants or approve any discharge of the
independent outside accountants when circumstances warrant.
7. The Committee shall review and approve the fees and other significant
compensation to be paid to the independent outside accountants.
2
8. On an annual basis, the Committee shall review and discuss with the
independent outside accountants all significant relationships they have
with the Company that could impair the outside accountants' independence
in accordance with Independence Standards Board Standard No. 1, and
obtain a formal written statement consistent therewith.
9. The Committee shall review the independent outside accountants' audit
plan, including its scope, staffing, locations, reliance upon
management, and general and internal audit approach.
10. Prior to releasing the fiscal year-end earnings, the Committee shall
discuss the results of the audit with the independent outside
accountants, as well as those matters required to be communicated to
audit committees in accordance with SAS No. 61.
11. The Committee shall consider the independent outside accountants'
judgments about the quality and appropriateness of the Company's
accounting principles as applied in its financial reporting.
12. The Committee shall request that the independent outside accountants
provide the Committee with
a. their independent judgments about the appropriateness of the
Company's current or proposed accounting principles and whether
current or proposed financial disclosures are clear;
b. their views on whether the accounting principles chosen by the
Company are conservative, moderate, or aggressive as they relate to
income, asset, and liability recognition, and whether these
accounting principles are commonly used;
c. reasons why accounting principles and disclosure practices used for
new transactions or events are appropriate; and
d. reasons for accepting or questioning significant estimates made by
the Company.
Internal Audit Department
13. The Committee shall review the budget, audit plan (including any
changes), charter, organizational structure, and qualifications of the
Company's internal audit department, as needed.
14. The Committee shall review the appointment, performance, reassignment
and replacement of the senior internal audit department executive.
15. The Committee shall review significant reports prepared by the
Company's internal audit department, together with management's
response and follow-up to these reports, as well as discuss with the
Company's internal audit department any difficulties they may have
encountered in the course of their audits, including any restrictions
on the scope of their work or access to required information.
Other Committee Responsibilities
The Committee shall:
16. Annually prepare a report to stockholders as required by the SEC, which
report shall be included in the Company's annual proxy statement.
17. Perform any other activities consistent with this Charter, the
Company's by-laws, and governing law, as the Committee or the Board
deems necessary or appropriate.
18. Periodically perform self-assessment of Committee performance.
19. Annually review with the Company's General Counsel any legal matters
that could have a significant impact on the Company's financial
statements, the Company's compliance policies and any material reports
or inquiries received from regulators or governmental agencies.
3
P R O X Y
TRANSMONTAIGNE INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
2001 ANNUAL MEETING OF STOCKHOLDERS
November 15, 2001
The undersigned stockholder of TRANSMONTAIGNE INC., a Delaware corporation,
hereby acknowledges receipt of the Notice of Annual Meeting of Stockholders and
Proxy Statement, each dated October 12, 2001, and hereby appoints Donald H.
Anderson and Erik B. Carlson, and each of them, proxies and attorneys-in-fact,
with full power to each of substitution, on behalf and in the name of the
undersigned, to represent the undersigned at the 2001 Annual Meeting of
Stockholders of TRANSMONTAIGNE INC. to be held on November 15, 2001 at 9:00
a.m., Denver Time, in the Central City Room at the Brown Palace Hotel, 321 17th
Street, Denver, Colorado and at any adjournment or postponement thereof, and to
vote all shares of Common Stock or Common Stock equivalents which the
undersigned would be entitled to vote if then and there personally present, on
the matters set forth on the reverse side.
----------- ------------
SEE REVERSE CONTINUED AND TO BE SIGNED ON REVERSE SIDE SEE REVERSE
SIDE SIDE
----------- ------------
DETACH HERE
[X] Please mark votes as in this example
THIS PROXY WILL BE VOTED AS DIRECTED OR, IF NO CONTRARY DIRECTION IS INDICATED,
WILL BE VOTED FOR THE ELECTION OF DIRECTORS AND AS SAID PROXIES DEEM ADVISABLE
ON SUCH OTHER MATTERS AS MAY PROPERLY COME BEFORE THE MEETING.
1. Election of eight Directors:
Nominees: (01) Cortlandt S. Dietler, (02) Donald H. Anderson, (03) Peter B.
Griffin, (04) Ben A. Guill, (5) John A. Hill, (06) Bryan H. Lawrence, (07)
Harold R. Logan, Jr., and (08) Edwin H. Morgens.
FOR WITHHELD
ALL FROM ALL
NOMINEES NOMINEES
[_] [_]
[_] -----------------------------------------------------------------------
To withhold authority to vote for any Nominee(s), check the box and write
such Nominee(s) name(s) above.
And, in their discretion, upon such other matter or matters which may properly
come before the meeting or any adjournment or adjournments thereof.
MARK HERE FOR ADDRESS CHANGE [_]
AND NOTE AT LEFT
(This Proxy should be marked, dated and signed by the stockholder(s) exactly as
his or her name appears hereon, and returned promptly in the enclosed envelope.
Persons signing in a fiduciary capacity should so indicate. If shares are held
by joint tenants or as community property, both should sign.)
Signature:_____________________________ Date: _______________
Signature:_____________________________ Date: _______________