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News: Dockwise Netherlands secures USD 40 million in near-term contracts & commitments

April 9, 2010 by john
View large version of image: Dockwise Netherlands secures USD 40 million in near-term contracts & commitments

Dockwise Ltd. has announced seven near-term contract wins for the transportation of four jack-up rigs, jack-up construction vessels, supply boats and a floating crane barge, to be transported to Rio de Janeiro, Brazil; Egypt; Sharjah, UAE; Singapore; Rotterdam, The Netherlands; Chabahar, Iran; and Trinidad, respectively.

Dockwise will execute the bulk of this newly contracted work during the second quarter of 2010. In addition, the Group has secured a variation order, under the Vyborg contract, generating additional sailing days during the first half. Total revenues for the various commitments are expected to reach approximately USD 40 million.

André Goedée, Chief Executive, Dockwise Ltd., said: “A stable oil price environment and stronger macroeconomic outlook has coincided with increased tender activity amongst drilling rig contractors, creating opportunities for Dockwise. While the return of tender activity is encouraging, we have yet to see whether this constitutes the beginning of a sustained recovery.”

Netherlands. Resolutions for Dockwise AGM of Shareholders 6th May 2010
Thursday, 08 April 2010

Resolution 1 Item 2 on the agenda: Appointment of the Chairman and the Secretary of the Meeting

The Board of Directors proposes to the Annual General Meeting of Shareholders to elect Mr. Adri Baan to act as Chairman of the Annual General Meeting, To request Mr. Fons van Lith to act as Secretary to the Annual General Meeting and to determine if the requirement for a quorum is satisfied.

Resolution 2

Item 3 on the agenda: Approval of the Notice and the Agenda of the Annual General Meeting

The Board of Directors proposes to the Annual General Meeting of Shareholders to approve that the Notice and the Agenda for the Annual General Meeting of Shareholders have been convened in accordance with the Articles of Association of the Company, the relevant laws and other applicable stock exchange regulations.

Resolution 3

Item 4 on the agenda: Approval of the minutes of last year’s Annual General Meeting

The Board of Directors proposes to the Annual General Meeting of Shareholders to adopt and approve the minutes of the Annual General Meeting of Shareholders held on 13 May 2009 in Southampton Bermuda as presented to the shareholders prior to the Meeting. Draft minutes of last year’s Annual General Meeting are available on the website of the Company.

Resolution 4

Item 5 on the agenda: Approval of dividend policy

A primary Dockwise objective is to optimize the long term return on invested shareholder capital. This return is to be achieved by realizing sustainable growth and by stable dividend payments (Total Shareholder Return).

The Board will apply a dividend policy that is based on a pay out ratio of between 35 and 45% of adjusted net profit in any year, whilst enabling the company’s growth. The proposal in any year to actually pay out is subject to:

• The Company’s target net debt: EBITDA ratio of 2.5:1 post dividend payment (i.e. no dividend as long as net debt:

EBITDA post such dividend would exceed 2.5:1 or is expected to breach 2.5:1 in the short term);

• The Company generating positive free cash flows, sufficient to meet its obligations under the Senior Facilities

Agreement (no dividend if after the obligations under the Senior Facilities Agreement no positive free cash flow is reported);

• Absence of contractual restrictions limiting the Company’s ability to pay dividends (no dividends if contractual restrictions of any kind prohibit the company to pay dividend).

Each year declaration of dividends will be proposed to the Annual General Meeting (AGM). Dividends can be paid out of earnings, retained and current, as well as from paid in surplus after satisfaction of the legal reserve as referred to hereinafter.

Applicable laws and regulations authorize the payment of stock dividends if sufficient surplus exists to pay for the par value of the shares issued in connection with any stock dividend.

Alternatively the Company can offer an optional dividend, leaving the choice of cash or stock to the Shareholders.

The choice of dividend proposal (cash, stock, mix or optional) takes into account the Company’s desired balance sheet structure and the interests of shareholders.

In addition Dockwise explicitly reserves the right to apply any amount set aside for dividend payments towards share

buy-backs insofar as permitted under laws and bye-laws and insofar as deemed fiscally advantageous to shareholders.

On the basis of the above policy no dividend will be paid with regard to 2009.

Resolution 5

Item 6 on the agenda: Approval of the audited financial statements of the Company for the year ended 31 December 2009

The annual report for 2009 including financial statements was published on the Company’s website on 5th March

2010. Hard copy has been available at the Company’s offices and at the register keepers Nordea for VPS in Norway and RBS for Euroclear in The Netherlands.

The annual accounts as included in the annual report have been audited by KPMG. An auditor’s report is included in the annual report. It is proposed to approve the audited financial statements.

Resolution 6

Item 7 on the agenda: Approval of distribution of profits

In accordance with the bye law 36 of the Company, ”The Board may, before declaring any dividend or distribution out of contributed surplus, set aside such sums as it thinks proper as reserves which shall, at the discretion of the Board, be applicable for any purpose of the Company and pending such application may, also at such discretion, either be employed in the business of the Company or be invested in such investments as the Board may from time to time think fit. The Board may also without placing the same to reserve carry forward any sums which it may think is prudent not to distribute”. The Company has repeatedly indicated that profits would be applied for net debt reduction and that a net debt to EBITDA ratio is targeted of equal or less than 2.5. The Board has decided to set aside the entire net profit after tax in 2009 aiming application of such for maintenance and improvement of covenant ratio’s and the gearing of the Company. This implies that, in line with accepted policy for 2009, no dividends are proposed.

Resolution 7

Item 8 on the agenda: Reappointment of Directors

The Board of Directors proposes to the Annual General Meeting of Shareholders, in order to ensure continuity in the Board of Directors, to reappoint the following Directors for a period of two years, ending the date of the Annual General Meeting in 2012, in accordance with the rotation schedule as described in bye-law 23 of the Company and as explained on page 14 of the Annual Report

a. Adri Baan

b. Tom Ehret

Profiles of the candidates for re-election can be found on page 15 and 16 of the Annual Report 2009 of Dockwise Ltd. which can be found on the website of the Company.

Dockwise has established a profile for the Board of Directors. The Nomination Committee has tested the reappointment of the above members of the Board against the profile of the Board of Directors and proposes to the AGM to reappoint Adri Baan and Tom Ehret. Relating to the proposed reappointment of Tom Ehret the following requirements to Directors from the Board Profile apply:

• At least one Director of the Board has knowledge of and experience in engineering and contracting business, implying relevant knowledge and experience on Design and Construct contracting and the specific risks involved.

• At least one Director of the Board has knowledge of and experience in exploration of offshore oil and or gas fields.

Relating to the proposed reappointment of Adri Baan the Nomination Committee considered his experience in working for global companies with international markets and clients of prime importance to the Company.

Resolution 8

Item 9 on the agenda: Election of Chairman

The Board of Directors proposes to the Annual General Meeting of Shareholders to reappoint Mr. Adri Baan as Chairman of the Board of Directors of Dockwise Ltd. The profile of Mr. Adri Baan can be found on page 15 of the Annual Report 2009 of Dockwise Ltd. which can be found on the website of the Company.

Resolution 9

Item 10 on the agenda: Reappointment of members of the Nomination Committee

The Company operates a Nomination Committee as described in bye law 23.4 of the Company and Principle 7 of the Norwegian Code of Practice for Corporate Governance. Chairman Wim van Vonno was appointed at the AGM of 2008 and is due for resignation and submit himself for reappointment.

Wim van Vonno is independent from executive management and from the Board of Directors. It is proposed to reappoint Wim van Vonno for a period of 2 years, ending the day of the AGM in 2012. Mister Van Vonno is rewarded a remuneration for his services of Euro 5,000 per year. It is proposed to maintain the remuneration at the same level for the period of reappointment. Member Adri Baan was also appointed in 2008 and due for resignation and submit himself for reappointment. Adri Baan is member of the Board of Directors. It is proposed to reappoint Mister Baan for a period of 2 years, ending the day of the AGM in 2012. Mister Baan is awarded no remuneration for his services as a member of the Nomination Committee.

Resolution 10

Item 11 on the agenda: Appointment of Auditors

The Board of Directors proposes to the Annual General Meeting of Shareholders to reappoint the external audit firm KPMG Accountants N.V. to be the independent auditor of the Company for the bookyear 2010.

In 2009 the auditor’s fee for auditing services was USD 1,096,000 and USD 1,225,000 million for tax and consultancy services.

Resolution 11

Item 12 on the agenda: Remuneration Policy and authorization management’s remuneration

The Board of Directors proposes that the Annual General Meeting of Shareholders approves an adjustment to the existing Remuneration Policy and to adopt a new Long Term Incentive (LTI) scheme as part of the management remuneration to be introduced effective from January 1st, 2010. This new LTI was presented and approved in principle at the AGM 2009. The Board now presents a further explanation for final approval by AGM. The proposed scheme will replace a current scheme, which is a 100% pure EVA based bonus cash scheme which provides for a split in partly cash paid and partly cash retained under a bonus-bank arrangement for pay out in later (3) years.

With the current proposal the Board, advised by the Remuneration Committee, aims further alignment of management remuneration with shareholder interest. The proposed Policy foresees in:

• Short Term Incentive (STI): An annual maximized percentage of the annual salary paid in cash and resulting from the EVA performance over the previous book year. The pay out levels will be in line with market levels for peer group companies and maximized at a percentage of base salary.

• Long Term Incentive (LTI): An annual conditional grant of shares rewarding performance over a period of three years. Performance will be based on 50% TSR and 50% EVA.

- Grant of performance shares varying between 10% of base salary to 60% of base salary for executive management.

- Vesting of the shares takes place after three 3 years of continued employment and subject to defined performance criteria on

1. Total Shareholder Return compared to a defined peergroup. In a peergroup of 13, Dockwise has to rank number 1 for vesting of 150%, descending to number 7 for vesting of 50% of conditionally granted shares;

2. Economic Value Added with vesting of 50% of the grant at an EVA multiplier between 0.5 and 1.0, 100% at a multiplier between 1.0 and 1.5 and 150% vesting of the grant at a multiplier equal to 1.5 or more.

How does this work out?

Below a sensitivity analysis is made for a manager with an annual base salary of Euro 175,000 and expected LTI value of 30% of base salary: The value per share at grant date is Euro 25, resulting in 2,100 shares. Of these shares 1,050 are linked to TSR and 1,050 to EVA.

Situation: Dockwise second in peergroup TSR after 3 years and EVA multiplier of 1. This results in 133.3% vesting on TSR performance and 100% on EVA performance. The conditionally granted share remuneration therefore results in 1,400 shares under TSR (133.3% x 1,050) and 1,050 shares under EVA (100% X 1,050).

The proposed scheme will apply for the variable pay of the senior top 20 (approx) of management and High Potentials. The remaining employees will continue under the current EVA based scheme.

Resolution 12

Item 13 on the agenda: Remuneration Directors

The Board of Directors proposes to the Annual General Meeting of Shareholders to approve the remuneration of the Directors as proposed by the Nomination Committee. The proposal is to maintain the remuneration at the level of 2009.

Resolution 13

Item 14 on the agenda: Authorization of the Board of Directors to issue shares

The Board of Directors proposes to the Annual General Meeting of Shareholders to approve the authorization of the Board of Directors to issue at the Board of Directors’ absolute discretion and subject to the Company’s Bye-laws 2,064,378 ordinary shares in the Company (representing a maximum of ten percent of the entire issued capital of the Company). The Board could use this authorization in these situations when an issue of additional shares is required to either reinforce the balance sheet and/or to issue shares for management remuneration as under resolution 11.

Yours sincerely,

On behalf of the Board of Directors of Dockwise Ltd.

Breda, 4 March 2010

Fons van Lith

Company Secretary

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