March 16, 2009
Sveaas in new attempt to gain Trico board seats
Kistefos AS, a Norwegian investment company owned by Christen Sveaas, has revised its proposal to nominate two of its executives for election to the board of Trico Marine Services, Inc. (NASDAQ: TRMA) has revised its proposal to nominate two of its executives for election to Trico's Board.
Kistefos is the largest shareholder in Trico Marine, but Trico rebuffed an earlier attempt by Kistefos to gain seats on the board, saying, essentially, that this would put Trico in breach of its Jones Act status.
Now Kistefos has sent a formal notice to Trico that proposes allowing stockholders to vote on increasing the size of the current Board by two to nine directors at Trico's 2009 Annual Meeting. Kistefos has nominated its owner, Christen Sveaas, and its CEO, Åge Korsvold, to fill the newly created vacancies .
Today it filed with the SEC to make its proposals the subject of a proxy vote at Trico's upcoming Annual General Meeting.
Kistefos has written Trico's independent directors urging them "to abandon your current rigid opposition, which essentially uses the Jones Act as a poison pill to prevent implementation of our proposals in any way."
Kistefos says it believes that its revised submission is an effective solution that meets Trico's qualification criteria and gives stockholders the representation they deserve on the board. Kistefos is confident that this proposed Board structure will ensure that Trico continues to be in compliance with the Jones Act, while giving stockholders an opportunity to have their voices heard on the most important matter at hand: Trico's future.
The letter says that the real issues at hand are Trico's financial and operating performance and the significant loss of stockholder value, especially in the past year.
Kistefos says it continues to believe there is significant inherent value in Trico and believes the infusion of new talent and ideas into Trico's board room would help cultivate that value for the benefit of all stockholders.
The letter says that the Kistefos proposals contemplate an increase in the size of the Board to nine, "an increase in the size of a Board quorum to seven and the nomination and election of Messrs. Sveaas and Korsvold to fill the new seats. As we have explained to you repeatedly, so long as our nominees constitute a minority of the Board quorum and we do not exercise control over more than 25% of any interest in Trico, we are confident our proposals raise no Jones Act issue. Under our proposals, our nominees would constitute less than 25% of the total number of directors and there is no question of impermissible control. To be clear, contrary to your assertions, based on discussions regarding the applicable provisions of law we have had with representatives of the U.S. Maritime Administration, we believe that there would be no Jones Act question raised solely by reason of the election of two non-citizens nominated by a non-citizen stockholder to a board of directors consisting of nine members which includes one additional non-citizen nominated by such board."
"Your communications to us and your 10-K filing this past week further suggest that you now believe that the number of non-citizen directors may not exceed 25 % of the Board or 25% of a quorum," continues the letter. "While we are not aware of any authority for this position and are of the belief that it misstates the proper application of the Jones Act to this situation, we have further modified our proposals to comply with your interpretation. Under our proposals, we would seek the removal of Mr. [Per] Staehr and we would agree to require that a quorum consist of at least six U.S. citizens, which is more than 75% of the quorum, thereby eliminating the concern. Mr. Staehr's removal would be necessary to insure that non-citizens do not comprise more than 25% of the Board. Since we do not believe that, in this situation, the Jones Act requires that non-citizen directors constitute no more than 25 % of the Board or 25% of a quorum, we would be willing to withdraw these further modified proposals upon your acknowledgement or a proper authority's determination that they are not legally required. If we were to mutually agree on these matters, they could easily be implemented by the Board and the stockholders at the upcoming annual meeting, thereby saving Trico's stockholders the considerable cost of a proxy contest."