Definitive Proxy Statement
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
SCHEDULE
14A
(Rule
14a-101)
INFORMATION
REQUIRED IN PROXY STATEMENT
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(e)(2))
|x| Definitive
Proxy Statement
|_| Definitive
Additional Materials
|_| Soliciting
Material under Rule 14a-12
GENCO
SHIPPING & TRADING LIMITED
(Name
of
Registrant as Specified in Its Charter)
------------------------------------------------------------
(Name
of
Person(s) Filing Proxy Statement, if other than the Registrant)
Payment
of Filing Fee (Check the appropriate box):
|x| No
fee
required
|_| Fee
computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11
(1) Title
of
each class of securities to which transaction applies:
_____________________________________________________________
(2) Aggregate
number of securities to which transaction applies:
_____________________________________________________________
|
(3)
|
Per
unit price or other underlying value of transaction computed pursuant
to
Exchange Act Rule 0-11 (set forth the amount on which the filing
fee is
calculated and state how it was
determined):
|
_____________________________________________________________
(4) Proposed
maximum aggregate value of transaction:
_____________________________________________________________
(5) Total
fee
paid:
_____________________________________________________________
|_| |
Fee
paid previously with preliminary
materials.
|
|_| |
Check
box if any part of the fee is offset as provided by Exchange Act
Rule
0-11(a)(2) and identify the filing for which the offsetting fee was
paid
previously. Identify the previous filing by registration statement
number,
or the Form or Schedule and the date of its
filing.
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(1) Amount
Previously Paid:
_____________________________________________________________
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Schedule or Registration Statement No.:
_____________________________________________________________
(3) Filing
Party:
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(4) Date
Filed:
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Genco
Shipping & Trading Limited
299
Park
Avenue (20th
Floor)
New
York,
New York 10171
(646)
443-8550
April
30,
2007
Dear
Shareholder:
You
are
cordially invited to attend the Annual Meeting of Shareholders which will be
held at the offices of Kramer Levin Naftalis & Frankel LLP, 1177 Avenue of
the Americas, New York, NY at 2:00 p.m. on Wednesday, May 16, 2007. Your
Board of Directors looks forward to greeting those shareholders that are able
to
attend. On
the
following pages you will find the formal Notice of Annual Meeting and Proxy
Statement.
Whether
or
not you plan to attend the meeting in person, it is important that your shares
be represented and voted at the Annual Meeting. Accordingly, please date, sign
and return the enclosed proxy card as
soon
as possible in the envelope provided.
Your
cooperation will ensure that your shares are voted.
I
hope
that you will attend the Annual Meeting, and I look forward to seeing you
there.
Sincerely,
Chairman
Genco
Shipping & Trading Limited
299
Park
Avenue (20th
Floor)
New
York,
New York 10171
NOTICE
OF
ANNUAL MEETING OF SHAREHOLDERS
TO
BE
HELD ON MAY 16, 2007
NOTICE
IS
HEREBY GIVEN that the Annual Meeting of Shareholders (the "Annual Meeting")
of
Genco Shipping & Trading Limited, a Marshall Islands corporation ("Genco"),
will be held on May 16, 2007 at 2:00 p.m. (local time), at the offices of Kramer
Levin Naftalis & Frankel LLP, 1177 Avenue of the Americas, New York, NY for
the following purposes:
|
1.
|
To
elect two Class II Directors to the Board of Directors of
Genco;
|
|
2.
|
To
ratify the appointment of Deloitte & Touche LLP as the independent
auditors of Genco for the fiscal year ending December 31, 2007;
and
|
|
3.
|
To
transact such other business as may properly come before the Annual
Meeting or at any adjournment or postponement
thereof.
|
Shareholders
of record at the close of business on April 16, 2007 are entitled to notice
of,
and to vote at, the Annual Meeting or any adjournment or postponement thereof.
A
list of such shareholders will be available at the Annual Meeting.
All
shareholders are cordially invited to attend the Annual Meeting. If you do
not
expect to be present at the Annual Meeting, you are requested to fill in, date
and sign the enclosed proxy and mail it promptly in the enclosed envelope to
make sure that your shares are represented at the Annual Meeting. In the event
you decide to attend the Annual Meeting in person, you may, if you desire,
revoke your proxy and vote your shares in person in accordance with the
procedures described in the accompanying proxy statement.
YOUR
VOTE IS IMPORTANT
IF
YOU
ARE UNABLE TO BE PRESENT PERSONALLY, PLEASE MARK, SIGN AND DATE THE
ENCLOSED
PROXY, WHICH IS BEING SOLICITED BY THE BOARD OF DIRECTORS, AND
RETURN
IT
PROMPTLY IN THE ENCLOSED ENVELOPE.
By
Order of the Board
of Directors,
/s/
John C.
Wobensmith
John
C.
Wobensmith
Chief
Financial
Officer, Principal
Accounting
Officer,
Secretary and Treasurer
New
York, New
York
April
30,
2007
Genco
Shipping & Trading Limited
299
Park
Avenue (20th
Floor)
New
York,
New York 10171
(646)
443-8550
__________________
PROXY
STATEMENT
ANNUAL
MEETING OF SHAREHOLDERS
TO
BE HELD MAY 16, 2007
___________________
This
proxy statement is furnished to shareholders of Genco Shipping & Trading
Limited ("Genco" or the "Company") in connection with the solicitation of
proxies, in the accompanying form, by the Board of Directors of Genco
(the "Board") for use in voting at the Annual Meeting of Shareholders (the
"Annual Meeting") to be held at the offices of Kramer Levin Naftalis &
Frankel LLP, 1177 Avenue of the Americas, New York, NY, on May 16, 2007 at
2:00
p.m., and at any adjournment or postponement thereof.
This
proxy
statement, and the accompanying form of proxy, are first being mailed to
shareholders on or about April 30, 2007.
VOTING
RIGHTS AND SOLICITATION OF PROXIES
Purpose
of the Annual Meeting
The
specific proposals to be considered and acted upon at the Annual Meeting are
summarized in the accompanying Notice of Annual Meeting of Shareholders. Each
proposal is described in more detail in this proxy statement.
Record
Date and Outstanding Shares
The
Board
has fixed the close of business on April 16, 2007 as the record date (the
"Record Date") for the determination of shareholders entitled to notice of,
and
to vote at, the Annual Meeting. Only shareholders of record at the close of
business on that date will be entitled to vote at the Annual Meeting or any
and
all adjournments or postponements thereof. As of April 16, 2007, Genco had
issued and outstanding 25,518,475 shares of common stock. The common stock
comprises all of Genco's issued and outstanding voting stock. Genco’s common
stock began trading on the New York Stock Exchange (NYSE) on April 11, 2007.
Prior to this date, Genco’s common stock traded on the NASDAQ Global Select
Market.
Revocability
and Voting of Proxies
Any
person signing a proxy in the form accompanying this proxy statement has the
power to revoke it prior to the Annual Meeting or at the Annual Meeting prior
to
the vote pursuant to the proxy. A proxy may be revoked by any of the following
methods:
|
·
|
by
writing
a letter delivered to John C. Wobensmith, Secretary of Genco, stating
that
the proxy is revoked;
|
|
·
|
by
submitting another proxy with a later date;
or
|
|
·
|
by
attending the Annual Meeting and voting in
person.
|
Please
note, however, that if a shareholder's shares are held of record by a broker,
bank or other nominee and that shareholder wishes to vote at the Annual Meeting,
the shareholder must bring to the Annual Meeting a letter from the broker,
bank
or other nominee confirming that shareholder's beneficial ownership of the
shares.
Unless
we
receive specific instructions to the contrary or unless such proxy is revoked,
shares represented by each properly executed proxy will be voted: (i) FOR the
election of each of Genco’s nominees as a director; (ii) FOR the ratification of
the appointment of Deloitte & Touche LLP as the independent auditors of
Genco for the fiscal year ending December 31, 2007; and (iii) with respect
to
any other matters that may properly come before the Annual Meeting, at the
discretion of the proxy holders. Genco does not presently anticipate any other
business will be presented for action at the Annual Meeting.
Voting
at the Annual Meeting
Each
share of common stock outstanding on the Record Date will be entitled to one
vote on each matter submitted to a vote of the shareholders, including the
election of directors. Cumulative voting by shareholders is not
permitted.
The
presence, in person or by proxy, of the holders of a majority of the votes
entitled to be cast by the shareholders entitled to vote at the Annual Meeting
is necessary to constitute a quorum. Abstentions and broker "non-votes" are
counted as present and entitled to vote for purposes of determining a quorum.
A
broker "non-vote" occurs when a nominee holding shares for a beneficial owner
does not vote on a particular proposal because the nominee does not have
discretionary voting power for that particular item and has not received
instructions from the beneficial owner.
A
plurality of the votes cast is required for the election of directors.
Abstentions and broker non-votes are not counted for the purpose of the election
of directors.
The
affirmative vote of a majority of the shares of common stock represented and
voted at the Annual Meeting is required for approval of Proposal Two.
Abstentions will have the same effect as a vote "against" Proposal Two, whereas
broker non-votes are not considered to have been voted on Proposal
Two.
Solicitation
We
will
pay the costs relating to this proxy statement, the proxy and the Annual
Meeting. We may reimburse brokerage firms and other persons representing
beneficial owners of shares for their expenses in forwarding solicitation
material to beneficial owners. Directors, officers and regular employees may
also solicit proxies. They will not receive any additional pay for the
solicitation.
ELECTION
OF DIRECTORS
Under
Genco’s Certificate of Incorporation, as amended, the Board of Directors is
classified into three classes. The two directors serving in Class II have terms
expiring at the 2007 Annual Meeting. The Board of Directors
has nominated the Class II directors currently serving on the Board of
Directors, Nathaniel
C.A. Kramer
and
Mark
F.
Polzin,
for
re-election to serve as Class II directors of the Company for a three-year
term
until the 2010 Annual Meeting of Shareholders of the Company and until their
successors are elected and qualified or until their earlier resignation or
removal. Although management has no reason to believe that the nominees will
not
be available as candidates, should such a situation arise, proxies may be voted
for the election of such other persons as the holders of the proxies may, in
their discretion, determine.
Directors
are elected by a plurality of the votes cast at the Annual Meeting, either
in
person or by proxy. Votes that are withheld will be excluded entirely from
the
vote and will have no effect.
THE
BOARD
OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE SHAREHOLDERS VOTE "FOR" THE
ELECTION (ITEM 1 ON THE ENCLOSED PROXY CARD) OF MESSRS. KRAMER AND POLZIN AS
CLASS II DIRECTORS.
Nominee
Information
The
following table sets forth information regarding the nominees for election
or
re-election as Class II Directors:
Name Age
Class
Position
_______ ____
_____
_______
Nathaniel
C.A. Kramer
45
II
Director
Mark
F.
Polzin
61
II
Director
Nathaniel
C.A. Kramer has
served as director of the Company since July 27, 2005. Mr. Kramer is a principal
at Mercantile Capital Group LLC, a private equity firm with offices in New
York
and Chicago, and Chairman and Managing Director of his firm's New York office
from 1999 to present. He brings over 20 years of investment experience in both
the public and private capital markets. He started his career with Allen and
Company, a private equity firm, and recently served as its Vice President.
Mr.
Kramer has led investments in a wide range of industries including
telecommunications, wireless infrastructure, waste management, data
communications, B2B commerce and Internet infrastructure sectors. Mr. Kramer
also serves on the boards of MoveOnIn, Inc. and Environmental Asset
Management.
Mark
F. Polzin has
served as a director of the Company since July 27, 2005. Since 1995, Mr. Polzin
has served as the President of Moreland Management Co., a private asset
management company, and has served as Chief Executive Officer since 2005. Prior
to joining Moreland in 1989, Mr. Polzin served for 18 years as an executive
and
director of several midwestern community banking organizations. He is a charter
member of the Wealth Management Client Advisory Board of The Northern Trust
Company, Chicago, and a founding member, director, and officer of the Center
for
the Study of Taxation, Costa Mesa, California. He holds a B.S. in Economics
from
the University of Wisconsin-Milwaukee and a J.D. from Marquette University
Law
School.
Continuing
Director Information
The
following table sets information regarding our directors whose terms continue
after the 2007 Annual Meeting. The terms for Directors in Class III expire
at
the 2008 Annual Meeting, and the terms for Directors in Class I expire at the
2009 Annual Meeting.
Name
Age
Class
Position
_______
____ _____ _______
Peter
C.
Georgiopoulos 46 III
Chairman
and Director
Stephen
A. Kaplan 48 III
Director
Rear
Admiral Robert C. North, USCG (ret.)
62 I
Director
Basil
G.
Mavroleon 59 I
Director
Harry
A.
Perrin 54 I Director
Class
III
Directors - Terms Expiring at the 2008 Annual Meeting
Peter
C.
Georgiopoulos
has
served as Chairman and as a member of our Board of Directors since our
inception. Since 1997, Peter C. Georgiopoulos served as Chairman and CEO of
General Maritime Corporation, a company he founded. Under the leadership of
Mr. Georgiopoulos, General Maritime Corporation grew from a single ship
ownership company to what today is an industry leader listed on the New York
Stock Exchange. Mr. Georgiopoulos is also Chairman and a director of Aegean
Marine Petroleum Network, Inc., a company listed on the New York Stock Exchange.
From 1991 to 1997, he was the principal of Maritime Equity Management, a
ship-owning and investment company that he founded in 1991. From 1990 to 1991,
he was affiliated with Mallory Jones Lynch & Associates, an oil tanker
brokerage firm. From 1987 to 1990, Mr. Georgiopoulos was an investment
banker at Drexel Burnham Lambert. Before entering the investment banking
business, he had extensive experience in the sale, purchase and chartering
of
vessels while working for shipowners in New York and Piraeus, Greece.
Mr. Georgiopoulos is a member of the American Bureau of Shipping. He holds
an MBA from Dartmouth College.
Stephen
A. Kaplan
has
served as a director of our company since July 27, 2005. From 2001 to the
present, he has served as a director of General Maritime Corporation. Since
1995, Mr. Kaplan has been a principal of Oaktree Capital Management, LLC, a
private investment management firm, where he co-manages Oaktree's Principal
Activities Group which invests in majority and significant minority positions
in
both private and public companies. Mr. Kaplan currently has in excess of
$3.5 billion in assets under his management. Since 1993, he has served as
portfolio manager of all of Oaktree's Principal Opportunities Funds, including
OCM Principal Opportunities III Fund, L.P. and OCM Principal Opportunities
Fund
IIIA, L.P., which collectively own Fleet Acquisition LLC, which owns
approximately 15.8% of the Company. From 1993 to 1995, Mr. Kaplan was a
Managing Director of Trust Company of the West. Before joining the Trust Company
of the West, Mr. Kaplan was a partner of the law firm of Gibson,
Dunn & Crutcher. Mr. Kaplan currently serves as a director of
Regal Entertainment Group and numerous private companies.
Class
I
Directors - Terms Expiring at the 2009 Annual Meeting
Rear
Admiral Robert C. North, USCG (ret.)
has
served as a director of our company since July 27, 2005. Since
his
retirement from the active duty with the U.S. Coast Guard in April of 2001,
Rear
Admiral North has served as the president of North Star Maritime, Inc., a
marine industry consulting firm, specializing in international and domestic
maritime safety, security and environmental protection issues. While on active
duty with the U.S. Coast Guard, Rear Admiral North reached the position of
Assistant Commandant for Marine Safety, Security and Environmental Protection,
where he directed national and international programs for commercial vessel
safety, merchant mariner licensing and documentation, port safety and security
and waterways management. He is a graduate of the Baltimore Polytechnic
Institute, State University of New York Maritime College at Fort Schuyler and
the U.S. Army War College.
Basil
G. Mavroleon
has
served as a director of our company since July 27, 2005. Mr. Mavroleon
has been employed in the shipping industry for the last 37 years. Since
1986, Mr. Mavroleon has served as Managing Director of Charles R. Weber
Company, Inc. one of the largest ship brokerages and marine consultants in
the United States. Since its inception in 2003 through its liquidation in
December 2005, Mr. Mavroleon has also served as Chairman of Azimuth Fund
Management (Jersey) Limited, a hedge fund dealing with tanker freight forward
agreements and derivatives. Mr. Mavroleon is a member of the Baltic
Exchange and is on the board of the Associate Membership Committee of
Intertanko, the Membership Committee of the Association of Ship Brokers and
Agents, and is Vice Chairman of the New York World Scale Committee.
Harry
A. Perrin
has
served as a director of the Company since August 15, 2005, and currently serves
as the Chairman of the Company’s Audit Committee. From June 2001 through
November 2006, Mr. Perrin worked as an investment banker with Petrie Parkman
& Co, an investment banking and financial advisory firm with offices in
Houston, Texas and Denver, Colorado. In December 2006, Merrill Lynch acquired
Petrie Parkman, and at that time, Mr. Perrin was hired as an investment banker
at Merrill Lynch where he is currently employed. Prior to joining Petrie
Parkman, Mr. Perrin was a partner for ten years in the business finance and
restructuring group for the Houston office of Weil Gotshal & Manges. Mr.
Perrin received his Bachelor of Business Administration in Accounting with
Honors from the University of Texas at Austin in 1975. He received his J.D.
with
High Honors from the University of Houston in 1980. Mr. Perrin is a member
of
the State Bar of Texas, and is a licensed Certified Public Accountant in the
State of Texas.
Corporate
Governance
Governance
Materials
- All of
the Company’s corporate governance materials, including the committee charters
of the Board of Directors (the “Board”) and the Company’s Corporate Governance
Guidelines, are published on the Corporate Governance section of the Company’s
website under “Investor” at www.gencoshipping.com.
These
materials are also available in print to any shareholder upon request. The
Board
regularly reviews corporate governance developments and modifies its committee
charters as warranted. Any modifications are reflected on the Company’s website,
including modifications recently made to all of its committee charters in
connection with the Company’s listing on the NYSE. Copies of these charters are
also attached hereto as Appendices A, B, and C.
Director
Independence
- It is
the Board’s objective that a majority of the Board consist of independent
directors. For a director to be considered independent, the Board must determine
that the director does not have any material relationship with the Company.
The
Board follows the criteria set forth in applicable NYSE listing standards to
determine director independence. The Board will consider all relevant facts
and
circumstances in making an independence determination.
All
members of the Audit, Compensation and Nominating and Corporate Governance
Committees must be independent directors as defined by applicable NYSE listing
standards. Members of the Audit Committee must also satisfy a separate
Securities and Exchange Commission independence requirement, which provides
that
they may not accept directly or indirectly any consulting, advisory or other
compensatory fee from the Company or any of its subsidiaries other than their
director compensation.
The
independent directors of the Company are Rear Admiral Robert C. North, Basil
G.
Mavroleon, Harry A. Perrin, Nathaniel C.A. Kramer, and Mark F. Polzin. The
Board
of Directors has determined that each of the members of the Audit, the
Compensation and the Nominating and Corporate Governance Committees,
respectively, are independent as defined in the applicable NYSE listing
standards. In determining that Mr. Mavroleon is independent, the board
considered the engagement of a shipbroker of which Mr. Mavroleon is a Managing
Director to which a commission of $131,500 was paid in connection with the
sale
of one of our vessels, the Genco Glory. Mr. Mavroleon is also a Managing
Director and a shareholder of a company owning 50% of this shipbroker. The
Board
did not believe that this transaction would impair Mr. Mavroleon’s ability to
act independently of management. See “Certain Relationships and Related
Transactions”.
Code
of Ethics
- All
directors, officers, employees and agents of the Company must act ethically
at
all times and in accordance with the policies comprising the Company’s code of
ethics set forth in the Company’s Code of Ethics. Under the Company’s Code of
Ethics, the Board will only grant waivers for a director or an executive officer
in limited circumstances and where circumstances would support a waiver. Such
waivers may only be made by the Audit Committee.
The
Company’s Code of Ethics is available on the Company’s website at www.gencoshipping.com
and is
available in print to any shareholder upon request.
Communicating
Concerns to Directors
-
Shareholders desiring to communicate directly with the Board of Directors or
with any individual director may do so in writing addressed to the intended
recipient(s), c/o John C. Wobensmith, Secretary, 299 Park Avenue (20th Floor),
New York, New York 10171. Once the communication is
received
by the Secretary, the Secretary reviews the communication. Communications that
comprise advertisements, solicitations for business, requests for employment,
requests for contributions or other inappropriate material will not be forwarded
to our directors. Other communications are promptly forwarded to the
addressee.
Board
Meetings and Committees
During
fiscal year 2006, there were five meetings of the Board of Directors. A quorum
of Directors was present, either in person or telephonically, for all of the
meeting. Actions were also taken during the year by unanimous written consent
of
the Directors. All directors attended at least 75% of the aggregate of the
total
number of meetings of the Board (held while they were directors). All directors
other than Mr. Mavroleon attended at least 75% of the total number of meetings
held by all Committees of the Board on which they served (during the periods
that they served). The Company encourages all directors to attend each annual
meeting of shareholders, of which the current annual meeting is the Company’s
first.
During
fiscal year 2006, Genco’s Audit Committee was comprised of Harry A. Perrin,
Nathaniel C.A. Kramer and Mark F. Polzin, all of whom qualify as independent
under the listing requirements of the NYSE and are financially literate. Mr.
Perrin is also a financial expert as defined under Item 401(h)(2) of Regulation
S-K. Through its written charter, the Audit Committee has been delegated the
responsibility of reviewing with the independent auditors the plans and results
of the audit engagement, reviewing the adequacy, scope and results of the
internal accounting controls and procedures, reviewing the degree of
independence of the auditors, reviewing the auditor’s fees and recommending the
engagement of the auditors to the full Board. The Audit Committee held six
meetings during fiscal year 2006.
During
fiscal year 2006, Genco’s Compensation Committee was comprised of Peter C.
Georgiopoulos, Basil G. Mavroleon, and Nathaniel C.A. Kramer, through July
22,
2006, all of whom except for Mr. Georgiopoulos qualify as independent under
the
listing requirements of the NYSE, and none of whom is an employee of Genco.
On
July 26, 2006, Mr. Georgiopoulos was replaced by Mr. Perrin, who qualifies
as
independent under NYSE listing requirements. Through its written charter, the
Compensation Committee administers Genco's equity incentive plan and other
corporate benefits programs. The Compensation Committee also considers from
time
to time matters of compensation philosophy and competitive status, and also
reviews, approves, or recommends executive officer bonuses, equity grants and
other compensation. The Compensation Committee generally does not delegate
its
authority, although Genco’s officers are responsible for the day-to-day
administration of Genco’s 2005 Equity Incentive Plan. The committee’s primary
processes for establishing and overseeing executive compensation can be found
under “Compensation Discussion and Analysis” below. Directors’ compensation is
established by the Board of Directors upon the recommendation of the
Compensation Committee. The Compensation Committee held one meeting during
fiscal year 2006.
During
fiscal year 2006, Genco’s Nominating and Corporate Governance Committee was
comprised of Peter C. Georgiopoulos, Rear Admiral Robert C. North, and Basil
G.
Mavroleon, through July 22, 2006, all of whom except for Mr. Georgiopoulos
qualify as independent under the listing requirements of the NYSE, and none
of
whom is an employee of Genco. On July 26, 2006, Mr. Georgiopoulos was replaced
by Mr. Polzin, who qualifies as independent under NYSE listing requirements.
Through its written charter, the Nominating and Corporate Governance Committee
assists the Board in identifying qualified individuals to become Board members,
in determining the composition of the Board and its committees, in monitoring
a
process to assess Board effectiveness and in developing and implementing the
Company’s corporate governance guidelines. When a vacancy exists on the Board,
or when the Board determines to add an additional director, the nominating
and
corporate governance committee seeks out appropriate candidates from various
sources, which may include directors, officers, employees and others. The
committee may use consultants and search firms who may be paid fees for their
assistance in identifying and evaluating candidates, but has not done so to
date. The committee does not have a set of minimum, specific qualifications
that
must be met by a candidate for director and will review the candidate's
background, experience and abilities, and the contributions the candidate can
be
expected to make to the collective functioning of the Board and the needs of
the
Board at the time. The committee considers candidates based on materials
provided, and will consider whether an interview is appropriate. The committee
will consider shareholder recommendations of director candidates, which should
be sent to the attention of the corporate secretary at the Company's
headquarters, on the same basis. The Nominating and Corporate Governance
Committee held one meeting during fiscal year 2006.
Executive
Sessions
Under
the
Corporate Governance Guidelines that the Company adopted this year in connection
with its listing on the New York Stock Exchange to assure free and open
discussion and communication among the non-management directors, the
non-management directors will seek to meet at least annually and may meet as
the
non-management directors deem appropriate. In addition, if there are any
non-management directors who are not independent directors, the independent
directors shall meet in executive session at least once each year. The presiding
director at any executive session with the non-management or independent
directors will be the Chairman if the Chairman is present and is a
non-management or independent director (as applicable) and will otherwise be
selected by a majority of the non-management or independent directors (as
applicable) present at the meeting. All of Genco’s directors are currently
non-management directors, and no executive sessions were held in fiscal year
2006.
Director
Compensation
For
fiscal year 2006, each
of
our directors received an annual fee of $30,000, a fee of $20,000 for an Audit
Committee assignment, $15,000 for a Compensation Committee assignment and $7,500
for a Nominating and Corporate Governance Committee assignment, each of which
was prorated based upon length of service. In addition, Peter C. Georgiopoulos,
Chairman of the Board, and Nathaniel C.A. Kramer, Basil G. Mavroleon, Rear
Admiral Robert C. North, USUGC (ret.), Harry A. Perrin, and Mark F. Polzin,
members of the Board, were each granted 1,200 restricted shares of common stock,
with restrictions on all such shares to lapse, if at all, on the earliest of
February 8, 2008, the occurrence of a Change in Control or the date of the
Company’s 2007 Annual Meeting of Shareholders. Restrictions on a pro rata
percentage of each director’s restricted shares will also lapse upon such
director’s death or disability. For fiscal year 2007, the amounts of the annual
fee for each director and fees for committee assignments are yet to be
determined. We also expect to make annual restricted stock grants to each
director other than Mr. Kaplan for 2007 in an amount yet to be determined.
We
reimburse our directors for all reasonable expenses incurred by them in
connection with serving on our board of directors. The following table
summarizes compensation earned by directors for the year ended December 31,
2006:
Name
of Director
(a)
|
|
Fees
Earned or Paid in Cash ($) (1)
(b)
|
|
Stock
Awards ($) (2)(3)
(c)
|
|
Total
($)
(h)
|
|
Peter
C. Georgiopoulos
|
|
$
|
42,514
|
|
$
|
13,511
|
|
$
|
56,025
|
|
Nathaniel
C.A. Kramer
|
|
$
|
65,000
|
|
$
|
13,511
|
|
$
|
78,511
|
|
Basil
G. Mavroleon
|
|
$
|
52,500
|
|
$
|
13,511
|
|
$
|
66,011
|
|
Rear
Admiral Robert C. North, USCG (ret.)
|
|
$
|
37,500
|
|
$
|
13,511
|
|
$
|
51,011
|
|
Harry
A. Perrin
|
|
$
|
56,534
|
|
$
|
13,511
|
|
$
|
70,045
|
|
Mark
F. Polzin
|
|
$
|
53,267
|
|
$
|
13,511
|
|
$
|
66,778
|
|
Stephen
A. Kaplan
|
|
$
|
--
|
|
$
|
--
|
|
$
|
--
|
|
|
(1) |
Directors
received an annual fee of $30,000, a fee of $20,000 for an Audit
Committee
assignment, $15,000 for a Compensation Committee assignment and $7,500
for
a Nominating and Corporate Governance Committee assignment, each
of which
was prorated based upon length of
service.
|
|
(2)
|
The
amounts in column (c) reflect the dollar amount recognized for financial
statement reporting purposes for the fiscal year ended December 31,
2006,
in accordance with FASB SFAS No. 123R, Share-Based Payment (“FAS 123R”),
of awards pursuant to the Company’s 2005 Equity Incentive Plan and
includes amounts from awards granted prior to 2006. Details regarding
the
calculation of these amounts are included in Notes 2 and 16 to the
Company’s audited financial statements for the fiscal year ended December
31, 2006 included in the Company’s Annual Report on Form 10-K filed with
the Securities and Exchange Commission on February 9, 2007. The actual
amount realized by the director will likely vary based on a number
of
factors, including the Company’s performance, stock price fluctuations and
applicable vesting.
|
|
(3)
|
On
February 8, 2007, the directors listed in the table each received
a grant
of 1,200 nonvested shares. The fair value on the date of grant for
each
such award is $36,624. Restrictions on all such shares lapse, if
at all,
on the earliest of February 8, 2008, the occurrence of a Change in
Control
as defined under the Company’s 2005 Equity Incentive Plan or the date of
the Company’s 2007 Annual Meeting of
Shareholders.
|
Compensation
Committee Interlocks and Insider Participation
No
interlocking relationship exists between any of Genco’s executive officers or
members of Genco's Board of Directors or compensation committee and any other
company's executive officers, Board of Directors or compensation
committee.
MANAGEMENT
Executive
Officers
The
following tables set forth certain information with respect to the executive
officers of Genco:
Executive
Officers
Name Age
Position
_______
____
_______
Robert
Gerald Buchanan
58
President(Principal
Executive Officer)
John
C.
Wobensmith
37
Chief
Financial Officer, Principal Accounting Officer, Secretary and
Treasurer
Robert
Gerald Buchanan
has
served as a President of our company since June 1, 2005. Mr. Buchanan has
40 years of shipping experience, holding various senior operating,
engineering and management positions. Before joining our company,
Mr. Buchanan spent eight years as a Managing Director of Wallem, a leading
technical management company. As the senior executive at Wallem,
Mr. Buchanan was responsible for the safe and efficient operations of close
to 200 vessels, as well as management of approximately 500 onshore and seagoing
staff. From 1990 to 1996, Mr. Buchanan was Technical Director of Canada
Steamships Lines of Montreal, overseeing a fleet of bulk carriers. Before this,
Mr. Buchanan managed an oceanographic research vessel for NATO from 1986 to
1990, was Superintendent Engineer of Denholm Ship Management's United Kingdom
office from 1982 to 1986, and Chief Engineer of Denholm Ship Management from
1969 to 1982. Mr. Buchanan was educated at Glasgow Nautical College and
obtained a First Class Engineers license for the both steam and motor ships.
Among his industry affiliations, Mr. Buchanan was a member of the
International Committee for Gard Protection & Indemnity
Association.
John
C. Wobensmith
has
served as our Chief Financial Officer and Principal Accounting Officer since
April 4, 2005. Mr. Wobensmith is responsible for overseeing our accounting
and
financial matters. Mr. Wobensmith has over 12 years of experience
in the shipping industry, with a concentration in shipping finance. Before
becoming our Chief Financial Officer, Mr. Wobensmith served as a Senior
Vice President with American Marine Advisors, Inc., an investment bank
focused on the shipping industry. While at American Marine Advisors, Inc.,
Mr. Wobensmith was involved in mergers and acquisitions, equity fund
management, debt placement and equity placement in the shipping industry. From
1993 through 2000, he worked in the international maritime lending group of
The
First National Bank of Maryland serving as a Vice President from 1998. He has
a
bachelors degree in economics from St. Mary's College of Maryland, and holds
the
Chartered Financial Analyst designation.
COMPENSATION
DISCUSSION AND ANALYSIS
Overview
of compensation program
The
Compensation Committee of the Board has responsibility for establishing,
implementing, and continually monitoring adherence with the Company’s
compensation philosophy. The Compensation Committee’s goal is to ensure that the
total compensation paid to the Company’s executive officers is fair, reasonable,
and competitive.
Throughout
this proxy statement, Robert Gerald Buchanan, the Company’s President, and John
C. Wobensmith, the Company’s Chief Financial Officer, are referred to as the
“named executive officers”.
Compensation
philosophy and objectives
The
Compensation Committee believes that its executive compensation program should
reward executives for enhancing the Company’s long-term performance while
delivering favorable annual operating results. The Compensation Committee
evaluates both performance and compensation so that the Company may attract
and
retain superior executives and maintain compensation competitive to that of
our
peer companies for similarly situated executives.
Elements
of compensation
The
Compensation Committee believes the Company’s executive compensation packages
should include both cash and stock-based compensation to meet the objectives
stated above. The principal components of compensation for our executive
officers currently are base salary, annual cash bonuses, equity awards in the
form of grants of restricted stock, and other benefits. Based on the Summary
Compensation Table below, 2006 compensation for the named executive officers
was
allocated 17% to base salary, 44% to annual cash bonus, 38% to grants of
restricted stock, and 1% to other benefits.
The
two
cash components of compensation provide our executives with immediately
realizable rewards for performance on an annual basis. Given the great degree
of
responsibility our two named executive officers bear for the Company’s
performance, we allocate a significant portion of their cash compensation to
annual bonus, which can be adjusted to reflect the Company’s
performance.
We
also
allocate a significant portion of annual compensation to restricted stock grants
that vest in portions over a period of time, currently four years, as we believe
that equity awards are important to align our executive’s interests with those
of our shareholders. We also view equity awards as important means to enhance
the retention of our executives. Unless the Compensation Committee determines
otherwise, each executive is entitled to receive dividends on restricted stock
at the
same
rate as is paid to other holders of the Company’s common stock. As the
executives share commensurately with other shareholders in receiving dividends,
they likewise share in the
recognition of current income generation and future changes in stock price.
However, if any such restricted shares do not vest, the holders of the
non-vesting shares must repay any dividends that were paid to them on the
non-vesting shares unless the Board or the Compensation Committee determines
otherwise with respect to dividends paid on shares of restricted stock granted
on or after December 21, 2005. The Compensation Committee seeks to achieve
the
proper balance between cash and stock-based compensation in order to provide
our
executives with incentives for performance in both the short and long term.
Benefits
are part of a competitive compensation package to attract and retain employees,
including executives. The named executive officers participate in the same
benefit plans as our salaried employees.
How
we determine the amount of compensation
The
Compensation Committee determines executive compensation primarily based on
consideration of the following three factors rather than rigidly adhering to
formulas:
· the
executive’s individual performance;
· an
internal review of the executive’s compensation; and
· market
data obtained by the Compensation Committee on groups of peer
companies.
For
fiscal year 2006, the Compensation Committee recommended compensation packages
for each named executive officer following consultations with the Company’s
Chairman as well as interviews with the officers to discuss their
accomplishments and goals. The Compensation Committee referred these packages
to
the Board for final approval, which the Board granted unanimously.
Performance
factors
The
Compensation Committee takes into account the contributions of each named
executive officer to the performance of the Company as a whole in establishing
his compensation. The Compensation Committee viewed
2006
as a
successful year for the Company punctuated by a number of achievements by our
executives, including the following:
|
·
|
The
Company’s acquisition of three high-quality vessels on favorable
terms.
|
|
·
|
The
appreciation of the Company’s stock and the overall performance of the
Company.
|
|
·
|
Effective
management of the Company’s chartering affairs, realizing a 99%
utilization rate.
|
|
·
|
Proficient
supervision of the activities of three separate management companies,
and
avoiding the need and related expense for an in-house chartering
department.
|
|
·
|
Arrangement
for an increase in the Company’s current credit
facility.
|
|
·
|
Efficient
management of the Corporations’ cash flow, breakeven levels, and interest
rate swaps.
|
|
·
|
Successful
implementation of Sarbanes-Oxley
compliance.
|
Review
of executive compensation
In
evaluating compensation for the named executive officers, the Compensation
Committee also reviews tally sheets that include the following
information:
|
·
|
Salary
and cash bonus compensation for prior years since the Company’s IPO in
2005;
|
|
·
|
Restricted
stock granted since the Company’s
IPO;
|
|
·
|
Vested
and unvested shares of restricted stock held;
and
|
|
·
|
The
value of benefits and perquisites.
|
In
determining total compensation amounts and the proper balance of compensation
types to provide appropriate incentives for performance, the Compensation
Committee analyzes the historical compensation information in the tally sheets,
including amounts potentially realizable on prior awards of restricted
stock.
Peer
group information
As
the
Company’s overall performance is a factor in executive compensation, the
Compensation Committee compares the Company’s performance to a peer group of
public drybulk shipping companies that compete with the Company. A detailed
analysis of our financial and operational performance is contained in the
Management’s Discussion & Analysis section of our 2006 Annual Report
filed with the SEC. Also, in order to maintain the competitiveness of the
Company’s executive compensation, the Compensation Committee compares its
executive compensation arrangements to those of another group of publicly-traded
drybulk shipping and tanker companies deemed to be similarly situated to the
Company. This second group is used to compare compensation arrangements because
some of the Company’s competitors are not required to disclose all of the
relevant compensation information.
Determination
of executive compensation
In
consideration of the various factors described above, the compensation packages
recommended by the Compensation Committee and approved by the Board of Directors
in its last fiscal year reflected increases in accordance with the Committee’s
assessment of the performance of the Company’s named executive officers. For Mr.
Buchanan, the approved package consisted of a cash bonus of $250,000,
representing an increase of $100,000 over the prior year, and a grant of 15,000
shares of restricted stock, representing an increase of 5,000 shares over the
prior year. For Mr. Wobensmith, the approved package consisted of an increased
base salary of $300,000, representing an increase of $50,000 over the prior
year; a cash bonus of $650,000, representing an increase of $225,000 over the
prior year, and a grant of 20,000 shares of restricted stock, representing
an
increase of 5,000 shares over the prior year. Further details of the
compensation awarded, including the terms applicable to the restricted stock
grants, are set forth below in this proxy statement under “Executive
Compensation.”
Tax
and accounting implications
Deductibility
of executive compensation
Section
162(m) of the Internal Revenue Code limits the deductibility of compensation
to
certain employees in excess of $1 million. So long as the Company qualifies
for
the exemption pursuant to Section 883 of the Internal Revenue Code of 1986,
as
amended, it is not subject to United States federal income tax on its shipping
income (which comprised substantially all of its gross revenue in 2006). If
the
Company does not qualify for the Section 883 exemption, its shipping income
derived from U.S. sources, or 50% of its gross shipping income attributable
to
transportation beginning or ending in the United States, would be subject to
a
4% tax imposed without allowance for deductions. Further discussion of this
exemption is provided in the Company’s Annual Report on Form 10-K for the Fiscal
Year ended December 31, 2006, under the heading “Risk Factors—Company Specific
Risk Factors—We may have to pay tax on U.S. source income . . .” For these
reasons, the Company has not sought to structure its cash bonus plan to qualify
for exemption under Section 162(m). For purposes of Section 162(m), payments
made under qualifying performance-based plans are not taken into account. The
Company's 2005 Stock Incentive Plan is designed and administered to qualify
as
"performance-based" and grants thereunder are therefore not subject to the
Section 162(m) limitation.
Accounting
for stock-based compensation
In
2006,
the Company adopted FAS 123R for accounting for nonvested stock issued under
its
2005 Stock Incentive Plan.
COMPENSATION
COMMITTEE REPORT
The
Compensation Committee of the Board has reviewed and discussed the Compensation
Discussion and Analysis required by Item 402(b) of Regulation S-K with
management and, based on such review and discussions, the Compensation Committee
recommended to the Board that the Compensation Discussion and Analysis be
included in this Proxy Statement.
Submitted
by the Compensation Committee of the Board of Directors:
Basil
G.
Mavroleon, Chairman
Nathaniel
C.A. Kramer
Harry
A.
Perrin
EXECUTIVE
COMPENSATION
The
following table sets forth in summary form information concerning the
compensation paid by us during the year ended December 31, 2006, to our named
executive officers:
|
|
Summary
Compensation Table
|
|
|
|
Name
and Principal
Position
(a)
|
|
|
|
Salary
($)
(c)
|
|
Bonus
($)
(d)
|
|
Stock
Awards
($)(1)
(e)
|
|
All
Other Compensation
($)
(i)
|
|
Total
($)
(j)
|
|
|
|
Robert
G. Buchanan
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
President
|
|
|
|
|
$
|
300,000
|
|
$
|
250,000
|
|
$
|
357,154
|
|
$
|
--
|
|
$
|
907,154
|
|
John
C. Wobensmith
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Chief
Financial Officer, Principal Accounting Officer, Secretary and
Treasurer
|
|
|
|
|
$
|
250,000
|
|
$
|
650,000
|
|
|
427,880
|
|
$
|
|
|
$
|
1,327,880
|
|
|
(1) |
The
amounts in column (e) reflect the dollar amount recognized for financial
statement reporting purposes for the fiscal year ended December 31,
2006,
in accordance with FAS 123R, of awards pursuant to the Company’s 2005
Equity Incentive Plan and includes amounts from awards granted both
in and
prior to 2006. Details
regarding the calculation of these amounts are included in Notes
2 and 16
to the Company’s audited financial statements for the fiscal year ended
December 31, 2006 included in the Company’s Annual Report on Form 10-K
filed with the Securities and Exchange Commission on February 9,
2007.
The
actual amount realized by the named executive will likely vary based
on a
number of factors, including the Company’s performance, stock price
fluctuations and applicable vesting. Additional information regarding
stock awards is provided in the Grants of Plan-Based Awards table
below.
|
|
(2)
|
Represents
payments made to the 401(k) Plan.
|
The
following table reflects awards of restricted stock under the Company’s 2005
Equity Incentive Plan during
the year ended December 31, 2006:
Grants
of Plan-Based Awards
|
Name
(a)
|
Grant
Date
(b)
|
|
All
Other Stock Awards: Number of Shares of Stock
(i)
|
|
Grant
Date Fair Value of Stock
Awards
($)
(l)
|
Robert
G. Buchanan
|
12/22/06
|
|
15,000
(1)
|
|
$421,500
|
John
C. Wobensmith
|
12/22/06
|
|
20,000
(1)
|
|
$562,000
|
|
(1)
|
The
restrictions applicable to the shares will lapse with respect to
25% of
the shares on each of the first four anniversaries of November 15,
2006.
The restrictions applicable to the shares granted will also lapse
with
respect to a pro rata percentage of the shares upon their death or
disability or termination without cause between two vesting dates,
and
will lapse in full upon the occurrence of a Change in Control (as
defined
in the 2005 Equity Incentive Plan). Recipients of restricted share
grants
will receive dividends thereon at
the same rate as is paid to other holders of common stock
but must repay dividends on any shares subject to forfeiture under
the
terms of such recipient's grant agreement unless the
Board of Directors waives the repayment requirement as to dividends
on
such shares.
|
The
following table provides information on restricted stock awards under the 2005
Equity Incentive Plan that were not vested as of December 31, 2006:
Outstanding
Equity Awards at Fiscal Year-End
|
Name
(a)
|
|
Number
of Shares of Stock That Have Not Vested
(g)
|
|
Market
Value of Shares of Stock that Have Not Vested ($)
(3)
(h)
|
Robert
G. Buchanan
|
|
44,888(1)
|
|
$1,254,171
|
John
C. Wobensmith
|
|
55,447(2)
|
|
$1,549,189
|
|
(1)
|
Represents
the unvested portions of: 29,850 restricted shares of our common
stock
granted on October 31, 2005, which vest in four equal installments
on the
first four anniversaries of the date of the Company’s initial public
offering; 10,000 restricted shares of our common stock granted on
December
21, 2005, which vest in four equal installments commencing on November
15,
2006 and on each of the first three anniversaries thereafter; and
15,000
restricted shares of our common stock granted on December 22, 2006,
which
vest in four equal installments commencing on November 15, 2007 and
on
each of the first three anniversaries thereafter. The foregoing grants
are
subject to accelerated vesting under certain circumstances set forth
in
the relevant grant agreement.
|
|
(2)
|
Represents
the unvested portions of: 32,262 restricted shares of our common
stock
granted on October 31, 2005, which vest in four equal installments
on the
first four anniversaries of the date of the Company’s
initial
|
public
offering; 15,000 restricted shares of our common stock granted on December
21,
2005, which vest in four equal installments commencing on November 15, 2006
and
on each of the first three anniversaries thereafter; and 20,000 restricted
shares of our common stock granted on December 22, 2006, which vest in four
equal installments commencing on November 15, 2007 and on each of the first
three anniversaries thereafter. The foregoing grants are subject to accelerated
vesting under certain circumstances set forth in the relevant grant
agreement.
|
(3)
|
The
value of the unvested stock awards equals the number of unvested
shares
held multiplied by $27.94, the closing price of the Company’s common stock
on the NASDAQ Global Select Market on December 29, 2006, which was
the
last trading date of the year ended December 31,
2006.
|
The
following table provides information regarding the number of restricted stock
awards that vested during the year ended December 31, 2006:
Stock
Vested
|
Name
(a)
|
|
Number
of Shares Acquired on Vesting
(d)
|
|
Value
Realized on Vesting ($) (1)
(e)
|
Robert
G. Buchanan
|
|
9,962
|
|
$214,543
|
John
C. Wobensmith
|
|
11,815
|
|
$258,623
|
|
(1)
|
The
value of the unvested stock awards that vested during the year ended
December 31, 2006 equals the number of shares vested multiplied by
the
closing price of the Company’s common stock on the NASDAQ Global Select
Market on the vesting date of each
grant.
|
Potential
Payments upon Termination or Change-in-Control
Under
the
terms of the restricted stock grant agreements between the Company and its
named
executive officers, all shares of restricted stock vest in full automatically
upon the occurrence of a Change of Control (as defined under our 2005 Equity
Incentive Plan). In addition, if the officer’s service to the Company is
terminated by the Company without cause or by reason of his death or disability
(each as defined under our 2005 Equity Incentive Plan), the restrictions lapse
as to a pro rata percentage of the shares, calculated monthly, that would
otherwise vest at the next anniversary of the grant date. For purposes of these
agreements, “service” means a continuous time period during which recipient of a
restricted stock grant is at least one of the following: an employee or a
director of, or a consultant to, the Company.
The
tables below set forth the vesting of restricted stock that the named executive
officers would receive upon termination of their service to the Company under
the following sets of circumstances: Change of Control and termination without
cause or by reason of death or disability. In each set of circumstances, we
have
assumed a termination as of the end of the day on December 29, 2006 and used
the
closing price of our common stock on that date of $27.94 per share for purposes
of the calculations for the tables below:
Name
|
Value
of Restricted Stock Subject to Accelerated Vesting
($)
|
|
Change
of Control
|
Termination
without Cause or by Reason of Death or
Disability
|
Robert
G. Buchanan
|
$1,254,143
|
$92,677
|
John
C. Wobensmith
|
$1,481,770
|
$102,624
|
Our
named
executive officers do not have agreements for any additional payments by reason
of a Change of Control.
Employment
Agreements
In
2007,
we intend to enter into employment agreements with our executive officers,
Messrs. Buchanan and Wobensmith.
Equity
Compensation Plan Information
The
following table provides information as of December 31, 2006 regarding the
number of shares of the Company’s common stock that may be issued under the
Company’s 2005 Equity Incentive Plan, which is the Company’s sole equity
compensation plan:
|
|
|
|
|
|
|
|
|
|
Number
of securities to be issued upon exercise of outstanding options,
warrantsand
rights
|
|
Weighted-average
exercise price of outstanding options,warrantsand
rights
|
|
Number
of securities
remaining
available for
future
issuance under equity compensation plans (excluding securities
reflected
in column (a))
|
|
Plan
category
|
|
(a)
|
|
(b)
|
|
(c)
|
|
|
|
|
|
|
|
|
|
Equity
compensation plans approved by security holders
|
|
|
-
|
|
$ |
-
|
|
|
1,741,525
|
|
Equity
compensation plans not approved by security holders
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
-
|
|
$ |
-
|
|
|
1,741,525
|
|
The
role
of the Audit Committee is to assist the Board of Directors in its oversight
of
the quality and integrity of the accounting, auditing and financial reporting
practices of the Company and the independence and performance of the Company's
auditors. The Board of Directors, in its business judgment, has determined
that
all members of the Committee are "independent," as provided under the applicable
listing standards of the NYSE. The Committee operates pursuant to a Charter,
a
copy of which is attached to this Proxy Statement as Appendix A. As set forth
in
the Charter, the Committee's job is one of oversight. Management is responsible
for the preparation, presentation and integrity of the Company's financial
statements. Management is also responsible for maintaining appropriate
accounting and financial reporting principles and practices and internal
controls and procedures designed to assure compliance with accounting standards
and applicable laws and regulations. The independent auditors are responsible
for auditing the annual financial statements, expressing an opinion based on
their audit as to the statements' conformity with generally accepted accounting
principles, monitoring the effectiveness of the Company's internal controls,
reviewing the Company's quarterly financial statements prior to the filing
of
each quarterly report on Form 10-Q and discussing with the Committee any issues
they believe should be raised with the Committee.
The
Committee met with the Company's independent auditors to review and discuss
the
overall scope and plans for the audit of the Company's consolidated financial
statements for the year ended December 31, 2006. The Committee has considered
and discussed with management and the independent auditors (both alone and
with
management present) the audited financial statements and the overall quality
of
the Company's financial reporting. Management represented to the Committee
that
the Company's financial statements were prepared in accordance with generally
accepted accounting principles, and the Committee reviewed and discussed the
financial statements with management.
The
Committee has also discussed with the independent auditors the matters required
to be discussed by Statement on Auditing Standards No. 61, Communication with
Audit Committees, as currently in effect. Finally, the Committee has received
written disclosures and the letter from the independent auditors required by
Independence Standards Board Standard No. 1, Independence Discussions with
Audit
Committees, as currently in effect. The Committee has considered whether the
provision of non-audit services by the independent auditors to the Company
is
compatible with maintaining the auditor's independence and has discussed with
the auditors the auditors' independence.
The
members of the Audit Committee are not professionally engaged in the practice
of
auditing or accounting and are not experts in the field of auditing or
accounting, including in respect of auditor independence. Members of the
Committee rely, without independent verification, on the information provided
to
them and on the representations made by management and the independent auditors.
Accordingly, the Audit Committee's activities do not provide an independent
basis to determine that management has maintained appropriate internal control
and procedures designed to assure compliance with accounting standards and
applicable laws and regulations. Furthermore, the Audit Committee's
considerations and discussions referred to above do not assure that the audit
of
the Company's financial statements has been carried out in accordance with
generally accepted auditing standards, that the financial statements are
presented in accordance with generally accepted accounting principles or that
the Company's auditors are in fact "independent."
Based
upon
the Committee's receipt and review of the various materials and assurances
described above and its discussions with management and independent auditors,
and subject to the limitations on the role and responsibilities of the Committee
referred to above and in the Charter, the Committee recommended to the Board
that the audited financial statements be included in the Company's Annual Report
on Form 10-K for the year ended December 31, 2006, to be filed with the
Securities and Exchange Commission.
Submitted
by the Audit Committee of the Board of Directors:
Harry
A.
Perrin, Chairman
Nathaniel
C.A. Kramer
Mark
F.
Polzin
The
Report of the Audit Committee does not constitute soliciting material, and
shall
not be deemed to be filed or incorporated by reference into any other Company
filing under the Securities Act of 1933, as amended, or the Securities Exchange
Act of 1934, as amended, except to the extent that the Company specifically
incorporates the Report of the Audit Committee by reference
therein.
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS
AND MANAGEMENT
The
following table sets forth certain information regarding the beneficial
ownership of Genco’s voting common stock as of April 23, 2007 of:
|
·
|
each
person, group or entity known to Genco to beneficially own more than
5% of
our stock;
|
|
·
|
each
of our Named Executive Officers;
and
|
|
·
|
all
of our directors and executive officers as a
group.
|
As
of
April 16, 2007, a total of 25,518,475 shares of common stock were outstanding
and entitled to vote at the Annual Meeting. Each share of common stock is
entitled to one vote on matters on which common shareholders are eligible to
vote. The amounts and percentages of common stock beneficially owned are
reported on the basis of regulations of the Securities and Exchange Commission
governing the determination of beneficial ownership of securities. Under the
rules of the Securities and Exchange Commission, a person is deemed to be a
“beneficial owner” of a security if that person has or shares “voting power,”
which includes the power to vote or to direct the voting of that security,
or
“investment power,” which includes the power to dispose of or to direct the
disposition of that security. A person is also deemed to be a beneficial owner
of any securities as to which that person has a right to acquire beneficial
ownership presently or within 60 days. Under these rules, more than one person
may be deemed a beneficial owner of the same securities, and a person may be
deemed to be the beneficial owner of securities as to which that person has
no
economic interest.
15
Name
and Address of Beneficial Owner (1)
|
Amount
of
Common
Stock
Beneficially
Owned
|
Percentage
of Common Stock
Outstanding
|
Peter
C. Georgiopoulos
|
3,591,710
(3)
|
14.07%
|
Robert
Gerald Buchanan
|
47,387
(4)
|
*
|
John
C. Wobensmith
|
73,462
(5)
|
*
|
Rear
Admiral Robert C. North, USCG (ret.)
|
2,400
(6)
|
*
|
Basil
G. Mavroleon
|
2,400
(6)
|
*
|
Nathaniel
C.A. Kramer
|
2,400
(6)
|
*
|
Mark
F. Polzin
|
4,200
(6)
|
*
|
Harry
A. Perrin
|
2,400
(6)
|
*
|
Stephen
A. Kaplan (2)
|
4,032,429
(7)
|
15.80%
|
B.
James Ford (2)
|
4,032,429
(7)
|
15.80%
|
Fleet
Acquisition LLC (2)
|
4,032,429
(7)
|
15.80%
|
All
Directors and executive officers as a group
(9
persons)
|
3,726,359(7)
|
14.60%
|
*
|
|
Less
than 1% of the outstanding shares of common
stock.
|
(1)
|
|
Unless
otherwise indicated, the business address of each beneficial owner
identified is c/o Genco Shipping & Trading Limited, 299 Park Avenue,
20th Floor, New York, New York
10171.
|
(2)
|
|
Each
of Mr. Kaplan’s, Mr. Ford’s and Fleet Acquisition, LLC’s, address is 333
South Grand Avenue, 28th Floor, Los Angeles, CA
90071.
|
(3)
|
|
Includes
1,200 restricted shares of our common stock granted on October 31,
2005,
which vested on May 18, 2006. Also includes 1,849 shares of common
stock
distributed to Mr. Georgiopoulos by Fleet Acquisition LLC on April
14,
2006 and 3,587,361 shares of common stock distributed to Mr. Georgiopoulos
by Fleet Acquisition LLC on December 15, 2006. On
February 8, 2007, Mr. Georgiopoulos
received a grant of 1,200 restricted shares which vest on the earliest
of
February 8, 2008, the occurrence of a Change in Control or the date
of the
Company’s 2007 Annual Meeting of
Shareholders.
|
(4)
|
|
Includes
29,850 restricted shares of our common stock granted on October 31,
2005,
which vest in four equal installments on the first four anniversaries
of
the date of the Company’s initial public offering; 10,000 restricted
shares of our common stock granted on December 21, 2005, which vest
in
four equal installments commencing on November 15, 2006 and on each
of the
first three anniversaries thereafter; and 15,000 restricted shares
of our
common stock granted on December 22, 2006, which vest in four equal
installments commencing on November 15, 2007 and on each of the first
three anniversaries thereafter. The foregoing grants are subject
to
accelerated vesting under certain circumstances set forth in the
relevant
grant agreement.
|
(5)
|
|
Includes
32,262 restricted shares of our common stock granted on October 31,
2005,
which vest in four equal installments on the first four anniversaries
of
the date of the Company’s initial public offering; 15,000 restricted
shares of our common stock granted on December 21, 2005, which vest
in
four equal installments commencing on November 15, 2006 and on each
of the
first three anniversaries thereafter; and 20,000 restricted shares
of our
common stock granted on December 22, 2006, which vest in four equal
installments commencing on November 15, 2007 and on each of the first
three anniversaries thereafter. The foregoing grants are subject
to
accelerated vesting under certain circumstances set forth in the
relevant
grant agreement.
|
(6)
|
|
Includes
1,200 restricted shares of our common stock granted on October 31,
2005,
which vested on May 18, 2006. On
February 8, 2007, each member of the board received a grant of 1,200
nonvested shares which vest on the earliest of February 8, 2008,
the
occurrence of a Change in Control or the date of the Company’s 2007 Annual
Meeting of Shareholders.
|
(7)
|
|
Oaktree
Capital Management, LLC, a registered investment adviser under the
Investment Advisers Act of 1940, is the general partner of OCM Principal
Opportunities III Fund, L.P. and OCM Principal Opportunities Fund
IIIA,
L.P. Mr. Kaplan, a director of Genco, is a Principal of Oaktree Capital
Management, LLC. As the general partner of OCM Principal Opportunities
III
Fund, L.P. and OCM Principal Opportunities Fund IIIA, L.P., Oaktree
Capital Management, LLC has voting and dispositive power over their
pro-rata ownership in Fleet Acquisition LLC. Although Oaktree Capital
Management, LLC may be deemed to beneficially own those shares for
purposes of Section 13 of the Securities Exchange Act of 1934, Oaktree
Capital Management, LLC disclaims beneficial ownership of those shares
except to the extent of its pecuniary interest in them. OCM Principal
Opportunities Fund III, L.P. and OCM Principal Opportunities Fund
IIIA,
L.P., or the Oaktree funds, of which Mr. Kaplan serves as portfolio
manager, own Fleet Acquisition LLC, except for a nominal equity interest
owned by Peter C. Georgiopoulos. Fleet Acquisition LLC may be deemed
to be
affiliated with OCM Investments, LLC, a registered broker-dealer,
by
reason of the relationship of the Oaktree funds with OCM Investments,
LLC.
Each of Messrs. Kaplan and Ford is a member of the Management Committee
of
Fleet Acquisition LLC. To the extent Messrs. Kaplan and Ford participate
in the process to vote or dispose of shares held by Fleet Acquisition
LLC,
each of them may be deemed under certain circumstances to beneficially
own
those shares for purposes of Section 13 of the Securities Exchange
Act of
1934. However, each of Messrs. Kaplan and Ford disclaim beneficial
ownership of these shares except to the extent of their pecuniary
interest
therein.
|
CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS
Registration
Rights Agreement
We
entered into a registration rights agreement on July 15, 2005, with Fleet
Acquisition LLC, pursuant to which we granted it, its affiliates and certain
of
its transferees, the right, under specified circumstances and subject to
specified restrictions, including restrictions included in the lock-up
agreements to which Fleet Acquisition is a party, to require us to register
under the Securities Act shares of our common stock held by it. Under the
registration rights agreement, these persons have the right to request us to
register the sale of shares held by them on their behalf and may require us
to
make available shelf registration statements that will permit sales of shares
into the market from time to time over an extended period. In addition, these
persons have the ability to exercise certain piggyback registration rights
in
connection with registered offerings requested by shareholders or initiated
by
us. To date, Fleet Acquisition LLC has exercised its registration rights with
respect to 4,830,000 shares of our common stock, which were sold on February
20,
2007 in a secondary offering under our shelf registration statement on Form
S-3.
Fleet Acquisition LLC currently owns 4,032,429 shares entitled to these
registration rights.
Transactions
with General Maritime Corporation
In
June
2006, the Company made an employee performing internal audit services available
to General Maritime Corporation (“GMC”), where the Company’s Chairman, Peter C.
Georgiopoulos, also serves as Chairman of the Board, Chief Executive Officer
and
President, and Stephen A. Kaplan, one of the Company’s directors, also serves as
a director. For the year ended December 31, 2006, the Company invoiced $52,000
to GMC for the time associated with such internal audit services. At December
31, 2006, the amount due the Company from GMC was $25,000.
During
the year ended December 31, 2006, the Company incurred travel-related and
miscellaneous expenditures totaling $257,000. These travel-related expenditures
are reimbursable to GMC or its service provider. For the year ended December
31,
2006, approximately $49,000 of these travel expenditures were paid from the
gross proceeds received from the initial public offering and as such were
included in the determination of net proceeds.
17
Other
Transactions
During
the year ended December 31, 2006, the Company incurred legal services (primarily
in connection with vessel acquisitions) aggregating $82,000 from Constantine
Georgiopoulos, the father of Peter C. Georgiopoulos, Chairman of the Board.
At
December 31, 2006, $54,000 was outstanding to Constantine
Georgiopoulos.
In
December 2006, the Company engaged the services of WeberCompass (Hellas) S.A.
(“WC”), a shipbroker, to facilitate the sale of the Genco Glory. One of our
directors, Basil G. Mavroleon, is a Managing Director of WC and a Managing
Director and shareholder of Charles R. Weber Company, Inc., which is 50%
shareholder of WC. WC received a commission of $131,500, or 1% of the gross
selling price of the Genco Glory.
Review
and Approval of Transactions with Related Persons
In
April
2007, our Board of Directors adopted a policy and procedures for review,
approval and monitoring of transactions involving the Company and “related
persons” (generally, directors and executive officers, director nominees,
shareholders owning five percent or greater of any class of the Company’s voting
securities, immediate family members of the foregoing). The policy covers any
related person transaction that meets the minimum threshold for disclosure
in
the proxy statement under the relevant SEC rules (generally, transactions
involving amounts exceeding $120,000 in which a related person has a direct
or
indirect material interest) and will be applied to any such transactions
proposed after its adoption.
Related
person transactions must be approved by the Board or by a committee of the
Board
consisting solely of independent directors, who will approve the transaction
only if they determine that it is in the best interests of the Company. In
considering the transaction, the Board or committee will consider all relevant
factors, including as applicable (i) the related person’s interest in the
transaction; (ii) the approximate dollar value of the amount involved in the
transaction;
(iii)
the approximate dollar value of the amount of the related person’s interest in
the transaction without regard to the amount of any profit or loss; (iv) the
Company’s business rationale for entering into the transaction; (v) the
alternatives to entering into a related person transaction; (vi) whether the
transaction is on terms no less favorable to the Company than terms that could
have been reached with an unrelated third party; (vii) the potential for the
transaction to lead to an actual or apparent conflict of interest and any
safeguards imposed to prevent such actual or apparent conflicts; (viii) the
overall fairness of the transaction to the Company; and (ix) any other
information regarding the transaction or the related person in the context
of
the proposed transaction that would be material to investors in light of the
circumstances of the particular transaction. If a director is involved in the
transaction, he or she will not cast a vote regarding the
transaction.
PROPOSAL
NO. 2
RATIFICATION
OF APPOINTMENT OF INDEPENDENT AUDITORS
The
Board
of Directors has selected the firm of Deloitte & Touche LLP as Genco's
independent auditors to audit the financial statements of Genco for the fiscal
year ending December 31, 2007 and recommends that shareholders vote for
ratification of this appointment. Representatives of Deloitte & Touche LLP
are expected to be present at the Annual Meeting, will have the opportunity
to
make a statement if they desire to do so and are expected to be available to
respond to appropriate questions. The affirmative vote of the holders of a
majority of the shares present in person or represented by proxy and voting
at
the Annual Meeting will be required to ratify the selection of Deloitte &
Touche LLP.
If
the
shareholders fail to ratify the selection, the audit committee and the Board
of
Directors will reconsider its selection of auditors. Even if the selection
is
ratified, the Board of Directors in its discretion may direct the appointment
of
different independent auditors at any time during the year if it determines
that
such change would be in the best interests of Genco and its
shareholders.
Fees
to Independent Auditors for Fiscal 2006 and 2005
The
following table presents fees for professional services rendered by Deloitte
& Touche LLP for the audit of the Company’s annual financial statements for
fiscal 2006 and fiscal 2005 and fees billed for audit-related services, tax
services and all other services rendered by Deloitte & Touche LLP for fiscal
2006 and fiscal 2005.
18
Type
of
Fees
2006
2005
($
in thousands) ($
in
thousands)
Audit Fees $572 $862
Audit-Related Fees $0 $0
Tax Fees $0 $0
All Other Fees
$0 $0
Total $572 $862
In
the
above table, in accordance with the SEC’s definitions and rules, “audit fees”
are fees that the Company paid to the auditor for the audit of the Company’s
annual financial statements included in its Form 10-K and review of financial
statements included in its Form 10-Qs and for services that are normally
provided by the auditor in connection with statutory and regulatory filings
or
engagements. “Audit-related fees” are fees for assurance and related services
that are reasonably related to the performance of the audit or review of the
Company’s financial statements; “tax fees” are fees for tax compliance, tax
advice and tax planning; and “all other fees” are fees for any services not
included in the first three categories.
Pre-Approval
Policy for Services Performed by Independent Auditor
The
Audit
Committee has responsibility for the appointment, compensation and oversight
of
the work of the independent auditor. As part of this responsibility, the Audit
Committee must pre-approve all permissible services to be performed by the
independent auditor.
The
Audit
Committee has adopted an auditor pre-approval policy which sets forth the
procedures and conditions pursuant to which pre-approval may be given for
services performed by the independent auditor. Under the policy, the Committee
must give prior approval for any amount or type of service within four
categories: audit, audit-related, tax services or, to the extent permitted
by
law, other services that the independent auditor provides. Prior to the annual
engagement, the Audit Committee may grant general pre-approval for independent
auditor services within these four categories at maximum pre-approved fee
levels. During the year, circumstances may arise when it may become necessary
to
engage the independent auditor for additional services not contemplated in
the
original pre-approval and, in those instances, such service will require
separate pre-approval by the Audit Committee if it is to be provided by the
independent auditor. For any pre-approval, the Audit Committee will consider
whether such services are consistent with the SEC’s rules on auditor
independence, whether the auditor is best positioned to provide the most cost
effective and efficient service and whether the service might enhance the
Company's ability to manage or control risk or improve audit quality. The Audit
Committee may delegate to one or more of its members authority to approve a
request for pre-approval provided the member reports any approval so given
to
the Audit Committee at its next scheduled meeting.
THE
BOARD
OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE SHAREHOLDERS VOTE "FOR" THE
RATIFICATION (ITEM 2 OF THE ENCLOSED PROXY CARD) OF THE APPOINTMENT OF DELOITTE
& TOUCHE LLP AS GENCO'S INDEPENDENT AUDITORS FOR THE FISCAL YEAR ENDING
DECEMBER 31, 2007.
SHAREHOLDER
PROPOSALS
Shareholder
proposals to be presented at the 2008 Annual Meeting of Shareholders must be
received by Genco at its offices in New York, New York, addressed to the
Secretary, not later than December 25, 2007, if the proposal is submitted for
inclusion in Genco’s proxy materials for that meeting pursuant to Rule 14a-8
under the Securities Act of 1934, or not earlier than November 18, 2007 and
not
later than December 18, 2007 if the proposal is submitted pursuant to Genco’s
By-Laws. Such proposals must comply with Genco's By-Laws and the requirements
of
Regulation 14A of the 1934 Act.
19
SECTION
16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Pursuant
to Section 16(a) of the 1934 Act and the rules thereunder, Genco's executive
officers and directors and persons who own more than 10% of a registered class
of Genco's equity securities, or 10% holders, are required to file with the
Securities and Exchange Commission reports of their ownership of, and
transactions in, Genco's common stock. Based solely on a review of copies of
such reports furnished to Genco, and written representations that no reports
were required, Genco believes that during the fiscal year ended December 31,
2006 its executive officers, directors, and 10% holders complied with the
Section 16(a) requirements.
ANNUAL
REPORT ON FORM 10-K
Genco
will provide without charge a copy of its Annual Report on Form 10-K filed
with
the Securities and Exchange Commission on February 9, 2007 (without the exhibits
attached thereto) to any person who was a holder of Genco common stock on the
Record Date. Requests for the Annual Report on Form 10-K should be made in
writing, should state that the requesting person held Genco common stock on
the
Record Date and should be submitted to John C. Wobensmith, Chief Financial
Officer, Principal Accounting Officer, Secretary and Treasurer of Genco, at
299
Park Avenue (20th
Floor),
New York, New York 10019.
CHARITABLE
CONTRIBUTIONS
During
fiscal year 2006, the Company did not make any contributions, to any charitable
organization in which an independent director served as an executive officer,
which exceeded the greater of $1 million or 2% of the charitable organization’s
consolidated gross revenues.
OTHER
MATTERS
At
the
date of this proxy statement, management was not aware that any matters not
referred to in this proxy statement would be presented for action at the Annual
Meeting. If any other matters should come before the Annual Meeting, the persons
named in the accompanying proxy will have discretionary authority to vote all
proxies in accordance with their best judgment, unless otherwise restricted
by
law.
BY
ORDER OF THE BOARD OF DIRECTORS
/s/
John
C.
Wobensmith
John
C. Wobensmith
Chief
Financial Officer, Principal
Accounting Officer, Secretary and Treasurer
20
Appendix
A
Genco
Shipping & Trading Limited
Audit
Committee Charter
(As
amended as of April 9, 2007)
This
Audit Committee Charter (“Charter”) has been adopted by the Board of Directors
(the “Board”) of Genco Shipping & Trading Limited (the “Company”).
Purpose
The
Audit
Committee (the “Committee”) assists the Board in its oversight of (1) the
quality and integrity of the Company’s financial statements and its accounting
and financial reporting practices, (2) the Company’s compliance with legal and
regulatory requirements, (3) the independent auditor’s qualifications and
independence and (4) the performance of the Company’s internal audit function
and independent auditors. It may also have such other duties as may from time
to
time be assigned to it by the Board and are required by the rules and
regulations of the Securities and Exchange Commission and The New York Stock
Exchange (the “NYSE”).
The
Committee shall maintain free and open communication (including periodic private
executive sessions) with the independent auditors and Company management. In
discharging its oversight role, the Committee shall have full access to all
Company books, records, facilities, personnel and outside professionals. The
Committee shall have the authority and shall receive necessary funding from
the
Company to retain special legal, accounting or other consultants or advisors
employed by the Committee and shall obtain such advice and assistance from
such
special legal, accounting or other consultants or advisors as the Committee
deems necessary. The Committee shall have sole authority to approve related
fees
and retention terms. Each member of the Committee shall be entitled to rely
on
(i) the integrity of those persons and organizations within and outside the
Company from which it receives information, (ii) the accuracy of the financial
and other information provided by such persons or organizations absent actual
knowledge to the contrary (which shall be promptly reported to the Board),
and
(iii) representations made by management and the independent auditors as to
all
audit and non-audit services provided by the independent auditors to the
Company.
Membership
and Structure
The
Committee shall be comprised of at least three directors determined by the
Board
to meet the director and audit committee member independence requirements,
subject to any applicable exemptions and phase-in provisions, and the financial
literacy requirements of the NYSE. At least one member of the Committee shall
have accounting or related financial management expertise, as determined by
the
Board. Appointment to the Committee, including the designation of the Chair
of
the Committee and the designation of any Committee members as “audit committee
financial experts”, shall be made on an annual basis by the full Board. The
Chair shall be responsible for leadership of the Committee, including scheduling
and presiding over meetings, preparing agendas, making regular reports to the
Board, and maintaining regular liaison with the chief executive officer, chief
financial officer and the lead independent audit partner.
Meetings
of the Committee shall be held at such times and places as the Committee shall
determine, including by written consent. The Committee shall also periodically
meet with the Company’s management, internal auditors (or other personnel
responsible for the internal audit function) and independent auditors separately
from the Board.
Responsibilities
The
Committee’s role is one of oversight. The Company’s management is responsible
for the preparation, presentation and integrity of the Company’s financial
statements. Management is responsible for maintaining appropriate accounting
and
financial reporting principles and practices and internal controls and
procedures designed to assure compliance with accounting standards and
applicable laws and regulations. The independent auditors are responsible for
auditing the annual financial statements to be included in the Company’s Annual
Report on Form 10-K and reviewing the Company’s quarterly financial statements
prior to the filing of any quarterly report on Form 10-Q, and other
procedures.
The
Committee and the Board recognize that management and the independent auditors
have more resources and time and more detailed knowledge and information
regarding the Company’s accounting and financial reporting practices than do
Committee members; accordingly the Committee’s oversight role does not provide
any expert or special assurance as to the Company’s financial statements or any
certification as to the work of the independent auditors. Nor is it the duty
of
the Committee to conduct investigations, to resolve disagreements, if any,
between management and the independent auditors, or to assure compliance with
laws and regulations.
Although
the Board and the Committee may wish to consider other duties from time to
time,
the general recurring activities of the Committee in carrying out its oversight
role are described below. The Committee shall be responsible for:
|
· |
The
appointment, replacement, compensation, evaluation and oversight
of the
work of the independent auditors to be retained to audit the annual
financial statements of the Company and review the quarterly financial
statements of the Company.
|
|
· |
Annually
obtaining and reviewing the independent auditor’s formal written statement
describing: the firm’s internal quality-control procedures; any material
issues raised by the most recent internal quality-control review,
or peer
review, of the firm, or by any inquiry or investigation by governmental
or
professional authorities, within the preceding five years respecting
one
or more independent audits carried out by the firm, and any steps
taken to
deal with any such issues.
|
|
· |
Annually
obtaining from the independent auditors a formal written statement
describing all relationships between the auditors and the Company
and
their independence as required by Independence Standards Board -
ISB1. The
Committee shall actively engage in a dialogue with the independent
auditors with respect to any disclosed relationships that may impact
the
objectivity and independence of the auditors, and shall consider
whether
the independent auditors’ provision of non-audit services to the Company,
if any, is compatible with the auditors’
independence.
|
|
· |
Reading
the annual audited financial statements and quarterly financial statements
and discussing them with management and the independent auditors.
These
discussions shall include consideration of the quality of the Company’s
accounting principles as applied in its financial reporting and the
Company’s disclosures under “Management’s Discussion and Analysis of
Financial Condition and Results of Operations.” Such discussions will
include particularly sensitive accounting estimates, reserves and
accruals, judgmental areas, audit adjustments and risk exposures
that may
have a material impact on the Company’s financial statements and the steps
management has taken to monitor and control such exposures, and other
such
inquiries as the Committee, management or the independent auditors
shall
deem appropriate. Based on this process, the Committee shall make
its
recommendation to the Board as to the inclusion of the Company’s audited
financial statements in the Company’s Annual Report on Form 10-K (or the
Annual Report to Shareholders, if distributed prior to the filing
of the
Form 10-K). In connection with such reviews the Committee should
ensure
that the Independent Auditors have fulfilled their responsibilities
under
AICPA SAS 61 “Communication with Audit
Committees.”
|
|
· |
Preparing
annually a report to be included in the Company’s proxy statement as
required by the rules of the Securities and Exchange Commission,
and
submitting such report to the Board for
approval.
|
|
· |
Overseeing
the relationship with the independent auditors, including discussing
with
the auditors the planning and staffing of the audit and the nature
and
rigor of the audit process, receiving and reading audit reports,
discussing with the auditors any problems or difficulties the auditors
may
have encountered in carrying out their responsibilities and any management
letters provided by the auditors and the Company’s response to such
letters, and providing the auditors full access to the Committee
and the
Board to report on all appropriate
matters.
|
|
· |
Providing
oversight of the Company’s accounting and financial reporting principles,
policies, controls, procedures and practices, and reviewing significant
changes to the foregoing as suggested by the independent auditors
or
management.
|
|
· |
Establishing
procedures for the receipt, retention and treatment of complaints
from the
Company’s employees on accounting, internal controls or auditing matters,
as well as for confidential, anonymous submissions by the Company’s
employees of concerns regarding questionable accounting or reporting
matters.
|
|
· |
Establishing
clear hiring policies for employees or former employees of the external
auditors.
|
|
· |
Annually
obtaining from the independent auditors a formal written statement
of the
fees billed for audit and non-audit services rendered by the independent
auditors for the most recent fiscal
year.
|
|
· |
At
the Committee’s discretion, discussing with management and independent
auditors earnings press releases, as well as financial information
and
earnings guidance provided to analysts and rating
agencies.
|
|
· |
Discussing
with management policies with respect to risk assessment and risk
management.
|
|
· |
Discussing
with management and/or the Company’s general counsel any legal matters
(including the status of pending litigation) that may have a material
impact on the Company’s financial statements or which might require
disclosure therein, and any material reports or inquiries from regulatory
or governmental agencies.
|
|
· |
Regularly
reporting its activities to the full Board and making such recommendations
with respect to the above and any other matters as the Committee
may deem
necessary or appropriate.
|
Committee
Performance
The
Committee shall have the following duties and responsibilities with respect
to
the Committee’s performance:
1.
|
The
Committee shall, on an annual basis, evaluate its own performance
under
this charter and in accordance with the NYSE listing rules and all
other
applicable law.
|
2.
|
The
Committee shall review, at least annually, the adequacy of this charter
and recommend to the Board for approval any proposed changes to this
charter.
|
Appendix
B
Genco
Shipping & Trading Limited
Compensation
Committee Charter
(As
amended as of April 9, 2007)
This
Compensation Committee Charter (“Charter”) has been adopted by the Board of
Directors (the “Board”) of Genco Shipping & Trading Limited (the “Company”).
Purpose
The
purpose of the Compensation Committee (the “Committee”) is to (1) perform the
functions described below under “Committee Duties and Responsibilities” in order
to discharge the Board’s responsibilities relating to compensation of the
Corporation’s executives and (2) to produce an annual report on executive
compensation for inclusion in the Corporation’s proxy statement, in accordance
with applicable rules and regulations.
Committee
Membership
The
Committee shall be comprised of at least two Directors who qualify as
independent directors under the listing requirements of the New York Stock
Exchange (“NYSE”). Committee members shall be appointed and removed by the
majority vote of the Board, on the recommendation of the Nominating and
Governance Committee. Members shall serve on the Committee for (1) the duration
of their current term on the Board, (2) until their resignation from the Board
or the Committee or (3) until successors shall be duly elected and qualified.
No
Committee member may be removed except by majority vote of the Board. Unless
a
chairperson of the Committee (the “Chairperson”) is elected by the Board, the
members of the Committee may designate a Chairperson by majority vote of the
full Committee membership.
Committee
Procedures
The
Committee shall meet at least once a year and at such additional times as may
be
necessary to carry out its duties and responsibilities as set forth herein.
The
Committee shall report its actions to the Board and keep written minutes of
its
meetings which shall be recorded and filed with the books and records of the
Corporation. The Committee shall have sole authority to retain any compensation
consultant or firm to assist in the evaluation of director, chief executive
officer or senior executive compensation, including the sole authority to
approve such firm or person’s fees and other retention terms.
Committee
Duties and Responsibilities
The
Committee shall report regularly to the Board summarizing any significant issues
considered by the Committee and any action it has taken.
The
principal duties and responsibilities of the Committee are as
follows:
1.
|
Review
and approve corporate goals and objectives relevant to the compensation
of
the chief executive officer and other designated executive officers
of the
Corporation (the “Officers”) and after the evaluation of the Officers’
performance in light of those goals and objectives, set the compensation
of each such Officer.
|
2.
|
Review,
and make periodic recommendations to the Board with respect to, the
general compensation, benefits and perquisites policies and practices
of
the Corporation including, without limitation, the Corporation’s
incentive-compensation plans and equity-based compensation
plans.
|
3.
|
Oversee
the Corporation’s compliance with the rules of the NYSE with respect to
the requirement for shareholder approval of equity compensation plans.
In
circumstances in which equity-based compensation plans are not subject
to
shareholder approval, such plans shall be subject to Committee
approval.
|
4.
|
Produce
an annual report on executive compensation for inclusion in the Company’s
proxy statement, and otherwise report to the shareholders of the
Company
in accordance with the rules and regulations of the U.S. Securities
and
Exchange Commission.
|
5.
|
Review
on an annual basis director compensation and benefits.
|
6.
|
Perform
such other duties as the Board may assign to the Committee with respect
to
the Corporation’s compensation policies.
|
Committee
Performance
The
Committee shall have the following duties and responsibilities with respect
to
the Committee’s performance:
1.
|
The
Committee shall, on an annual basis, evaluate its own performance
under
this charter and in accordance with the NYSE listing rules and all
other
applicable law.
|
2.
|
The
Committee shall review, at least annually, the adequacy of this charter
and recommend to the Board for approval any proposed changes to this
charter.
|
Appendix
C
Genco
Shipping & Trading Limited
Nominating
and Corporate Governance Committee Charter
(As
amended as of April 9, 2007)
This
Nominating and Corporate Governance Committee Charter (“Charter”) has been
adopted by the Board of Directors (the “Board”) of Genco Shipping & Trading
Limited (the “Corporation”).
Purpose
The
purpose of the Nominating and Corporate Governance Committee (the “Committee”)
is to assist the Board in (1) identifying qualified individuals to become Board
members, (2) monitoring a process to assess Board effectiveness, (3) determining
the composition of the Board and its committees and (4) developing, recommending
to the Board and implementing the Corporation’s corporate governance guidelines.
Committee
Membership
The
Committee shall be comprised of at least two Directors who qualify as
independent directors under the listing requirements of the New York Stock
Exchange (“NYSE”). Committee members shall be appointed and removed by the
majority vote of the Board. Members shall serve on the Committee for (1) the
duration of their current term on the Board, (2) until their resignation from
the Board or the Committee or (3) until successors shall be duly elected and
qualified. No Committee member may be removed except by majority vote of the
Board. Unless a chairperson of the Committee (the “Chairperson”) is elected by
the Board, the members of the Committee may designate a Chairperson by majority
vote of the full Committee membership.
Committee
Procedures
The
Committee shall meet at least once a year and at such additional times as may
be
necessary to carry out its duties and responsibilities as set forth herein.
The
Committee shall report its actions to the Board and keep written minutes of
its
meetings which shall be recorded and filed with the books and records of the
Corporation. In discharging its role, the Committee shall have full access
to
all Corporate books, records, facilities, personnel and outside professionals.
The Committee may retain special legal, accounting or other consultants as
advisors as it deems necessary for fulfillment of its responsibilities, and
shall have sole authority to approve the fees and other retention terms of
such
consultants and advisors. The Committee shall have the sole authority to retain
and terminate any search firm used to identify director candidates and shall
have sole authority to approve the search firm’s fees and other retention terms.
Committee
Duties and Responsibilities
The
Committee shall have the following duties and responsibilities:
1.
|
Lead
the search for individuals qualified to become members of the Board
and to
select director nominees to be presented for shareholder approval
at the
annual meeting. The Committee shall select individuals as director
nominees who shall have the highest personal and professional integrity,
who shall have demonstrated exceptional ability and judgment and
who shall
be most effective, in conjunction with the other nominees of the
Board, in
collectively serving the long-term interests of the
shareholders;
|
2.
|
Review
the Board’s committee structure and to recommend to the Board for its
approval directors to serve as members of each committee. The Committee
shall review and recommend committee slates annually and shall recommend
additional committee members to fill vacancies as needed;
|
3.
|
Develop
and recommend to the Board for its approval a set of corporate governance
guidelines. The Committee shall review the guidelines on an annual
basis,
or more frequently, if appropriate, and recommend changes as necessary;
|
4.
|
Oversee
the evaluation of the Board and
management;
|
5.
|
Review,
at least annually, with the Corporation’s chief executive officer, the
succession plans relating to the position of chief executive officer;
and
|
6.
|
Perform
such other duties as the Board may assign to the Committee with respect
to
the Corporation’s nominating and governance
policies.
|
Committee
Performance
The
Committee shall have the following duties and responsibilities with respect
to
the Committee’s performance:
1.
|
The
Committee shall report its actions and recommendations to the Board
from
time to time and shall, on an annual basis, evaluate its own performance
under this charter and in accordance with the NYSE listing rules
and all
other applicable law.
|
2.
|
The
Committee shall review, at least annually, the adequacy of this charter
and recommend to the Board for approval any proposed changes to this
charter.
|
THIS
PROXY WILL BE VOTED AS DIRECTED, OR IF NO DIRECTION IS INDICATED, WILL
BE
VOTED
"FOR" THE PROPOSALS.
THIS
PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
|_|
Please
Mark Here for Address Change or Comments
SEE
REVERSE SIDE
THE
BOARD
OF DIRECTORS RECOMMENDS A VOTE FOR ITEMS 1 AND 2.
1.
ELECTION OF DIRECTORS
|_|
FOR
|_|
WITHHELD FOR ALL
NOMINEES:
01
NATHANIEL C.A. KRAMER
02
MARK
F. POLZIN
Withheld
for the nominees you list below: (Write that nominee's name in the space
provided below.)
____________________________________
2.
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
|_|
FOR |_|
AGAINST |_|
ABSTAIN
If
you
plan to attend the Annual Meeting, please mark the WILL ATTEND box:
|_|
WILL ATTEND
Signature
_________________________________________________________________________________________
Signature
_________________________________________________________________________________________
Date_________________________________________
NOTE:
Please sign as name appears hereon. Joint owners should each sign. When signing
as attorney, executor, administrator, trustee or guardian, please give full
title as such.
________________________________________________________________________________________________________________________________
FOLD
AND
DETACH HERE
THIS
PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
GENCO
SHIPPING & TRADING LIMITED
The
undersigned hereby appoints Robert Gerald Buchanan and John C. Wobensmith,
and
each of them, with power to act without the other and with power of
substitution, as proxies and attorneys-in-fact and hereby authorizes them to
represent and vote, as provided on the other side, all the shares of Genco
Shipping & Trading Limited Common Stock which the undersigned is entitled to
vote, and, in their discretion, to vote upon such other business as may properly
come before the Annual Meeting of Shareholders of Genco Shipping & Trading
Limited to be held on May 16, 2007 or any adjournment thereof, with all powers
which the undersigned would possess if present at the Meeting.
(Continued,
and to be marked, dated and signed, on the other side)
Address
Change/Comments (Mark the corresponding box on the reverse
side)
|
|
FOLD
AND
DETACH HERE