UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

(Amendment No.    )

Filed by the Registrant  þ                            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))
þ		Definitive Proxy Statement
¨		Definitive Additional Materials
¨		Soliciting Material Pursuant to §240.14a-12
GulfMark Offshore, Inc.
(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):
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Notice of

Annual Meeting of

Stockholders and

Proxy Statement

Annual Meeting

June 7, 2012

Tribeca Room

The Peninsula Hotel

700 5^th Avenue at 55^th Street

New York, New York 10019

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GULFMARK OFFSHORE, INC.

10111 Richmond Avenue, Suite 340

Houston, Texas 77042

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

To Be Held June 7, 2012

NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of GulfMark Offshore, Inc. (the “Company”) will be held in the Tribeca Room, The Peninsula Hotel, 700 5^th Avenue at 55^th Street, New York, New York 10019, on Thursday, June 7, 2012 at 8:00 A.M, eastern daylight time, for the following purposes:

 

1.

To elect eight (8) directors;

 

2.

To vote on a proposal to approve, by a stockholder non-binding advisory vote, the compensation paid by us to our named executive officers, commonly referred to as a “Say-on-Pay” proposal;

 

3.

To vote on a proposal to ratify the selection of KPMG LLP as the Company’s independent public accountants for the fiscal year ending December 31, 2012; and

 

4.

To transact such other business as may properly come before the meeting or any adjournment thereof.

Your Board of Directors has approved and recommends that you vote “FOR” proposals 1 through 3 which are described in more detail in the attached Proxy Statement.

The Board of Directors (the “Board”) has fixed the close of business on April 13, 2012, as the record date for the determination of stockholders entitled to notice of and to vote at the meeting or any adjournments or postponements of the meeting. Only stockholders of record at the close of business on the record date are entitled to notice of and to vote at the meeting.

You are cordially invited to attend the meeting. Stockholders may call our main offices at 713-963-9522 for directions to The Peninsula Hotel in order to attend the meeting and vote in person.

Your broker cannot vote your shares for the election of directors or the “Say-on-Pay” proposal without your instructions. If you do not provide voting instructions, your shares will not be voted or counted on these important matters.

TO ENSURE YOUR REPRESENTATION AT THE MEETING, PLEASE SIGN, DATE AND RETURN THE ENCLOSED PROXY OR VOTE ON THE INTERNET AT YOUR EARLIEST CONVENIENCE, WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING. THE ENCLOSED RETURN ENVELOPE MAY BE USED FOR MAILING PURPOSES. YOUR PROXY WILL BE RETURNED TO YOU IF YOU SHOULD BE PRESENT AT THE MEETING AND SHOULD YOU REQUEST SUCH A RETURN.

Important Notice Regarding the Availability of Proxy Materials for the

Stockholders’ Meeting of GulfMark Offshore, Inc. to be Held on June 7, 2012:

The Proxy Statement dated April 27, 2012, Form of Proxy, and the GulfMark Offshore, Inc. 2011

Annual Report to Stockholders for the year ended December 31, 2011 are available at

http://www.proxydocs.com/GLF.

 

Date: April 27, 2012

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GULFMARK OFFSHORE, INC.

10111 Richmond Avenue, Suite 340

Houston, Texas 77042

PROXY STATEMENT FOR

ANNUAL MEETING OF STOCKHOLDERS

To Be Held June 7, 2012

The Company

GulfMark Offshore, Inc., a Delaware corporation, was incorporated in 1996. On February 24, 2010, GulfMark Offshore, Inc., (“Old GulfMark”) merged with and into its wholly owned subsidiary, New GulfMark Offshore, Inc., a Delaware corporation (“New GulfMark”), pursuant to an agreement and plan of reorganization, with New GulfMark as the surviving corporation (such transaction, the “Reorganization”). The Reorganization was adopted by the stockholders and New GulfMark changed its name from “New GulfMark Offshore, Inc.” to “GulfMark Offshore, Inc”. The business, operations, assets and liabilities of New GulfMark after the Reorganization are the same as business, operations, assets and liabilities of Old GulfMark immediately prior to the Reorganization. The Reorganization was effected primarily to better position us to benefit from and adhere to U.S. maritime laws and regulations. Unless the context requires otherwise, references to “GulfMark,” “the Company,” “we,” “us” and “our” refer to New GulfMark, its direct or indirect subsidiaries, Old GulfMark and all other predecessors to Old GulfMark.

General Information

The accompanying Proxy is solicited by the Company at the direction of the Board of Directors (the “Board”) for use at the Annual Meeting of Stockholders of the Company (the “Annual Meeting”) to be held on Thursday, June 7, 2012, at the time and place and for the purposes set forth in the accompanying Notice of Annual Meeting and at any adjournments thereof. Information on how to obtain directions to attend the meeting and vote in person is set forth in the accompanying Notice of Annual Meeting.

Board Recommendations

The Board recommends that the stockholders vote “FOR” the election of the Board’s nominees for director, “FOR” the non-binding proposal to approve our named executive officer compensation (“Say-on-Pay”) and “FOR” ratification of the selection by the Board of KPMG LLP as our independent public accountants for the 2012 fiscal year.

Voting by Proxy

When proxies in the accompanying form are received and properly executed, or voted on the internet, the shares will be voted by the persons named in the Proxy as directed in the Proxy unless contrary instructions are given. Where no instruction is indicated on the Proxy with respect to Proposal 1, the Proxy will not be voted which has the effect of a vote against the directors. Where no instruction is indicated on the Proxy with respect to Proposal 2, the Proxy will not be voted which has no effect on the outcome of the non-binding proposal. Where no instruction is indicated on the Proxy with respect to Proposal 3 of the Proxy Statement with regard to the ratification of the selection of KPMG LLP as independent public accountants for 2012, the Proxy will be voted FOR the ratification. If you are a stockholder of record and you do not cast your vote either in person or by proxy, no votes will be cast on your behalf on any of the items of business at the Annual Meeting.

 

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Shares Held in Street Name

If your shares are held beneficially in “street” name through a nominee such as a brokerage firm, financial institution or other holder of record, your vote is controlled by that firm, institution or holder. Your vote may also be cast by telephone or Internet, as well as by mail, if your brokerage firm or financial institution offers such voting alternatives. Please follow the specific instructions provided by your nominee on your proxy card. If your shares are registered in “street” name and you do not provide your broker or holder with voting instructions, your shares may constitute “broker non-votes.” Generally, broker non-votes occur on certain non-routine matters when a broker is not permitted to vote on that matter without specific instructions from the beneficial owner and instructions are not given. Thus, if you hold your shares in street name and you do not instruct your bank or broker how to vote in the election of directors and on the “Say-on-Pay” proposal, no votes will be cast on your behalf. Your bank or broker will, however, continue to have discretion to vote any uninstructed shares on the ratification of the appointment of our independent auditors. Such shares will be voted “FOR” the ratification.

Revocability of Proxies

You have the right to revoke your proxy at any time prior to its use by submitting to the Secretary of the Company a written revocation or a duly executed proxy card bearing a later date. If you are present at the meeting and request the return of your previously executed proxy, your proxy will be returned.

Solicitation of Proxies

Upon request, additional proxy material will be furnished without cost to brokers and other nominees to forward to the beneficial owners of shares held in their names. We will bear all costs of soliciting proxies. Proxies will be solicited principally by mail but may also be solicited by our directors, officers and regular employees, without additional compensation to such individuals.

Quorum

The presence, in person or by proxy, of at least a majority of the shares outstanding on the record date will constitute a quorum. Abstentions and broker non-votes and, with respect to the election of directors, “withhold” votes, are counted for the purpose of determining the presence of a quorum.

Votes Required to Approve Matters Presented at the Annual Meeting

Election of Eight Directors (Proposal 1). The election to the Board of the persons nominated in this Proxy Statement will require the vote of the holders of a plurality of the shares represented in person or by proxy at a meeting at which a quorum is present. Abstentions and broker non-votes will not affect the election outcome.

Non-Binding Advisory “Say-on-Pay” Vote (Proposal 2). At a meeting at which a quorum is present, the vote of the holders of a majority of the shares entitled to vote on the proposal will constitute stockholder non-binding approval with respect to the compensation paid to our named executive officers. Abstentions will have the same effect as an “against” vote for this proposal, but broker non-votes will have no effect.

Ratification of Auditor Appointment (Proposal 3). The vote of the holders of a majority of the shares entitled to vote and represented in person or by proxy at a meeting at which a quorum is present is required to ratify the selection of KPMG LLP as our independent auditors for fiscal year 2012 by the Audit Committee of our Board of Directors. Broker non-votes will be counted as a “for” vote for this proposal. Abstentions will have the same effect as an “against” vote for this proposal.

Other Business (Proposal 4). If any other matters come before the meeting that are not specifically set forth on the proxy card and in this Proxy Statement, such matters shall be decided by the vote of the holders of a majority of the shares represented in person or by proxy at the Annual Meeting, unless otherwise provided in our Certificate of Formation, our By-laws, or as otherwise required by law.

Availability of Proxy Materials

This Proxy Statement will be first sent or given to stockholders on or about April 27, 2012.

The Proxy Statement dated April 27, 2012, Form of Proxy, and the GulfMark Offshore, Inc. 2011 Annual Report to Stockholders for the year ended December 31, 2011 are available at http://www.proxydocs.com/GLF.

 

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VOTING SECURITIES AND PRINCIPAL STOCKHOLDERS

At the effective time of the Reorganization, each outstanding and treasury share of the common stock of the Old GulfMark automatically converted into one share of Class A common stock (the “Common Stock”) of the Company. Shares of Common Stock of the Company trade on the same exchange, the New York Stock Exchange, and under the same symbol, “GLF”, that the shares of Old GulfMark’s common stock traded on and under prior to the Reorganization. References to “Common Stock” in this Proxy Statement for dates prior to the Reorganization refer to Old GulfMark’s common stock that was converted to the Company’s Common Stock in the Reorganization.

The record date for the determination of stockholders entitled to notice of and to vote at the Annual Meeting to be held June 7, 2012, is the close of business on April 13, 2012 (the “Record Date”). As of the Record Date, there were 26,826,766 shares of Common Stock issued and outstanding. Each share of Common Stock is entitled to one vote on each matter to be acted upon at the meeting.

The following table sets forth certain information for each person who on the Record Date was known by the Company to be the beneficial owner of more than 5% of the outstanding Common Stock:

 

Name and Address of Beneficial Owner		No. Shares Beneficially Owned (1)				Percent of Class
Lord, Abbett & Co. LLC			3,175,394				11.84	%
90 Hudson Street
Jersey City, NJ 07302-3900(2)
Wellington Management Company, LLP			2,844,040				10.60	%
280 Congress Street
Boston, MA 02210(3)
Dimensional Fund Advisors LP			1,858,457				6.93	%
Palisades West
Building One
6300 Bee Cave Road
Austin, TX 78746(4)

 

(1)	Unless otherwise indicated below, the persons or group listed have sole voting and investment power with respect to their shares of Common Stock.

(2)	The information shown above was obtained from the Schedule 13G/A, dated February 14, 2012, as filed with the United States Securities and Exchange Commission (“SEC”) by Lord, Abbett & Co. LLC.

(3)	The information shown above was obtained from the schedule 13G/A, dated February 14, 2012, as filed with the SEC by Wellington Management Company, LLP.

(4)	The information shown above was obtained from the Schedule 13G/A, dated February 14, 2012, as filed with the SEC by Dimensional Fund Advisors LP.

 

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SECURITY OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS

The following table sets forth, as of the Record Date, the number and percentage of Common Stock beneficially owned by each of our directors and director nominees, each executive officer named in the summary compensation table included under “Executive Officers”, and all directors and executive officers as a group:

 

Name		Common Stock Subject to Restricted Stock Awards(1)				Common Stock Subject to Currently Exercisable Options(2)				Other Common Stock Beneficially Owned				Units Equivalent  to Common Stock Beneficially Owned(3)				Total Common Stock Beneficially Owned(4)				Percent of Class(5)				Non-Vested Units Equivalent to Common Stock Not Beneficially Owned(6)				Total Interest in Common Stock and Units Equivalent
Peter I. Bijur			2,495				20,000				18,200				4,984				45,679				—				—				45,679
David J. Butters			2,495				20,000				674,413	(7)			14,896				711,804				2.6	%			—				711,804
Brian R. Ford			2,495				—				10,700				1,087				14,282				—				396				14,678
Louis S. Gimbel, 3rd			2,495				20,000				385,088	(8)			8,028				415,611				1.5	%			—				415,611
Sheldon S. Gordon			2,495				20,000				41,000				27,687				91,182				—				—				91,182
Robert B. Millard			2,495				20,000				450,355				17,882				490,732				1.8	%			—				490,732
Rex C. Ross			2,495				—				15,300	(9)			7,403				25,198				—				—				25,198
Bruce A. Streeter			46,681				—				476,117				67,758				590,556				2.2	%			—				590,556
Quintin V. Kneen			29,705				—				29,224				11,516				70,445				—				3,869				74,314
John E. (“Gene”) Leech			24,835				—				265,563	(10)			45,340				335,738				1.2	%			—				335,738
Richard M. Safier			12,336				—				—				543				12,879				—				951				13,830
Samuel R. Rubio			10,629				—				12,515				10,828				33,972				—				—				33,972
Other			10,223				—				3,202				5,748				19,173				—				—				19,173
All directors and executive officers as a group (13 persons)			151,874				100,000				2,381,677				223,700				2,857,251				10.6	%			5,216				2,862,467

 

(1)	Includes shares of our Common Stock held for our directors and executive officers pursuant to restricted stock awards issued under various incentive plans maintained by us. The beneficial owner has sole voting power and no investment power with respect to these shares during the restriction period.

(2)	Includes currently exercisable stock options and those stock options that will become exercisable within 60 days of the Record Date issued under our various incentive plans we maintain. The beneficial owner has no voting power or investment power over these shares prior to exercising the options.

(3)	Includes shares of our Common Stock held for our directors and executive officers under our current Executive Nonqualified Excess Plan where the shares are vested or will vest within 60 days of the Record Date.

(4)	Unless otherwise indicated below, the persons listed have sole voting and investment power with respect to their shares of our Common Stock.

(5)	Percentage based solely on Total Common Stock Beneficially Owned. Less than 1% unless otherwise indicated.

(6)	Includes shares of our Common Stock held for our directors and executive officers under our current Executive Nonqualified Excess Plan where such shares do not vest within 60 days of the Record Date.

(7)	Includes 80,400 shares beneficially owned by Mr. Butters’ wife, and with respect to which shares Mr. Butters has shared voting and dispositive power.

 

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(8)	Includes 30,420 shares of our Common Stock owned by trusts of which Mr. Gimbel is the co-trustee, and with respect to which shares Mr. Gimbel has shared voting and dispositive power.

(9)	Includes 13,100 of our Common Stock owned by trusts of which Mr. Ross is trustee.

(10)	Includes 1,595 shares of our Common Stock beneficially owned by Mr. Leech’s children, and with respect to which shares Mr. Leech has shared voting and dispositive power.

PROPOSAL 1

ELECTION OF EIGHT DIRECTORS

The Board has nominated eight directors for election at the Annual Meeting. Each director to be elected will hold office until the next Annual Meeting and until such director’s successor is elected and qualified. Each nominee listed below is currently a director of the Company and was elected as a director by the stockholders of the Company. The nominees receiving a plurality of votes cast at the Annual Meeting will be elected as directors. Abstentions and broker non-votes are counted for purposes of determining the presence or absence of a quorum for the transaction of business, but will not affect the election outcome.

The Board believes that each of the eight nominees possesses the qualities and experience that the Board believes our directors should possess, as described in detail below in the section entitled “Our Board of Directors – Selection of Director Nominees.” The nominees for election to the Board, together with their biographical information and the Board’s reasons for selecting them as nominees, are set forth below. No family relationship exists between any of the nominated directors or the executive officers listed in the Executive Officer portion of this Proxy Statement.

 

Name of Nominee		Age		Year First Became Director
Peter I. Bijur		69		2003
David J. Butters		71		1989
Brian R. Ford		63		2009
Louis S. Gimbel, 3rd		83		1970
Sheldon S. Gordon		76		2001
Robert B. Millard		61		1989
Rex C. Ross		68		2007
Bruce A. Streeter		63		1997

Peter I. Bijur serves as a member of the Audit and Compensation Committees and is Chairman of the Governance & Nominating Committee. Mr. Bijur currently serves on the Board of Directors and the Audit Committee of Volvo AB and is the former Chairman of the Board of Directors and Chief Executive Officer of Texaco Inc. where he served from 1996 until his retirement in 2001. Mr. Bijur formerly served as a member of the Board of Trustees of Middlebury College and Mount Sinai-New York University Health. The Board determined that Mr. Bijur should be nominated for election as a director due to his extensive executive experience, including his prior service as the chairman and chief executive officer of a major public corporation, his public company board leadership experience, and his corporate governance expertise.

David J. Butters is Chairman of the Board of Directors and is Chairman of the Compensation Committee. Since September 2008, Mr. Butters has been Chairman, President and Chief Executive Officer of Navigator Holdings Ltd., an international LPG shipping company. Mr. Butters is also currently a member of the Board of Directors of Weatherford International, Inc. Mr. Butters retired from Lehman Brothers, Inc., a subsidiary of Lehman Brothers Holdings Inc. (“Lehman”) in September 2008. He had been employed at Lehman since 1969, most recently holding the position of Managing Director. The Board determined that Mr. Butters should be nominated for election as a director due to his extensive knowledge of the shipping and oil and gas service industries, his experience as a director of public companies, his banking experience and his financial and executive management expertise.

 

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Brian R. Ford was appointed to the Board in March of 2009 and is chairman of the Audit Committee. Mr. Ford was the Chief Executive Officer of Washington Philadelphia Partners, LP from 2008 through 2010. He retired as a partner from Ernst & Young LLP in June 2008 where he had been employed since 1971. Mr. Ford also serves on the Board of Trustees of Drexel University and Drexel University College of Medicine School and is a member of the Executive Committee and Board of the Philadelphia Convention and Visitors Bureau. The Board determined that Mr. Ford should be nominated for election as a director due to his financial, audit and accounting expertise gained as a partner in a top tier public accounting firm.

Louis S. Gimbel, 3^rd is a member of the Governance & Nominating Committee. He has served as Chief Executive Officer of S. S. Steiner, Inc. since 1990. He is also Chairman of the Board of Hops Extract Corporation of America and Manager of Stadelman Fruit LLC. Mr. Gimbel is also a member of the Board of Golden Gate Hop Ranches Inc. and Simon H. Steiner, Hopfen, GbmH. S. S. Steiner, Inc. is engaged in the farming, trading, processing, importing and exporting of hops and other specialty crops. Mr. Gimbel is also a trustee for the Monmouth County (WJ) Conservation Foundation. The Board determined that Mr. Gimbel should be nominated for election as a director due to his extensive knowledge of the Company gained from over 40 years of service as a director of the Company and its predecessors, and his experience as the chief executive officer of a multinational corporation.

Sheldon S. Gordon is a member of the Compensation, Governance & Nominating and Audit Committees. From May 1996 to September 2011, he served as non-executive Chairman of Union Bancaire Privée International Holdings, Inc. From May 1996 to March 2002, he was Chairman of the Rhone Group LLC with which he continues as a Senior Advisor. Mr. Gordon was a director of Union Bancaire Privée from March 1997 to March 2011 and was a Director of the Holland Balanced Fund from June 1996 to June 2008 and of Ametek, Inc. from 1989 to May 2011. The Board determined that Mr. Gordon should be nominated for election as a director due to his financial and accounting expertise, his experience as a senior executive and director of large multinational corporations, and his strategic business management expertise.

Robert B. Millard is currently Managing Partner of Realm Partners LLC. From 1976 until September 2008, Mr. Millard held various positions, including Managing Director, at Lehman Brothers, Inc. and its predecessors. From September 2008 until December 2008, Mr. Millard was a Managing Director of Barclays Bank. Mr. Millard serves as Lead Independent Director of L-3 Communications Inc. He also serves as Chairman of the Board of the MIT Investment Management Company, on the Boards of Trustees of the MIT Corporation (Executive Committee), The Population Council, Associated Universities Inc. and the Remarque Institute of New York University. He also serves on the Investment Subcommittee of the Finance and Budget Committee of the Council on Foreign Relations. Mr. Millard served as a director of Weatherford International Inc. from 1989 to January 2012. The Board determined that Mr. Millard should be nominated for election as a director due to his expertise in financial, business and corporate development matters, his experience as a director of public companies, and his extensive experience in the oil and gas service industry.

Rex C. Ross is a member of the Compensation Committee and the Governance & Nominating Committee. From 2004 to 2009, Mr. Ross served as Chairman and director of Schlumberger Technology Corporation, the holding company for all Schlumberger Limited assets and entities in the United States. Prior to his retirement from Schlumberger Limited in May 2004, Mr. Ross held a number of executive management positions during his 11-year career there, including President of Schlumberger Oilfield Services North America; President, Schlumberger GeoQuest; and President of SchlumbergerSema North & South America. Mr. Ross was elected a Director of Enterprise Products Partners L.P. (a publicly traded oil and gas mid-stream services and marketing company) in October 2006 and is a member of its Audit and Conflicts and Governance Committees. The Board determined that Mr. Ross should be nominated for election as a director due to his executive management expertise and his knowledge of the oil and gas service industry.

Bruce A. Streeter has served as President and Chief Operating Officer of the Company since January 1997 and as Chief Executive Officer since 2006. He served as President of our Marine Division from November 1990 until he became President and Chief Operating Officer of the Company. Prior to November 1990, Mr. Streeter was with Offshore Logistics, Inc. for a period of twelve years serving in a number of capacities, including General Manager Marine Division. The Board determined that Mr. Streeter should be nominated for election as a director due to his extensive knowledge of the industry and the Company, its operations and people, gained from 32 years of service in the industry in positions of increasing responsibility.

 

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Required Vote for Election of Directors

Election of the persons nominated in this Proxy Statement will require the vote of the holders of a plurality of the shares of Common Stock present or represented by proxy and entitled to vote at a meeting at which a quorum is present.

In accordance with the Company’s corporate governance guidelines, any director nominee who receives a greater number of “WITHHELD” votes than votes “FOR” such election must tender his resignation following certification of the stockholder vote. The Governance & Nominating Committee will recommend to the Board whether such resignation should be accepted, and the Board will promptly disclose on a Form 8-K its decision whether to accept or reject the resignation. The nominee director who has tendered his resignation cannot participate in any Board action regarding whether to accept his resignation offer.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” THE ELECTION AS DIRECTORS OF THE PERSONS NOMINATED.

OUR BOARD OF DIRECTORS

Role of the Board

Our directors are elected by our stockholders to oversee the actions and results of our management. Their responsibilities include:

 

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providing general oversight of our business, including the audit function;

 

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approving corporate strategy;

 

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approving major management initiatives;

 

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providing oversight of legal and ethical conduct;

 

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overseeing the management of any significant business risks;

 

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selecting, compensating, and evaluating directors;

 

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evaluating board processes and performance;

 

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selecting, compensating, evaluating and, when necessary, replacing the President and Chief Executive Officer, and compensating other senior executives;

 

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ensuring that a succession plan is in place for all senior executives; and

 

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establishing and overseeing committees to manage the foregoing.

Our Board is responsible for consideration and oversight of risks facing the Company. Together with its standing committees, the Board is responsible for ensuring that material risks are identified and managed appropriately. In particular, the Audit Committee performs a central oversight role with respect to financial and compliance risks, and the Compensation Committee considers risk in connection with its design of compensation programs for our executives. The Board and its committees regularly review material strategic, operational, financial, compensation and compliance risks with senior management in detail in order to adequately assess and determine our potential vulnerability and consider appropriate risk management strategies where necessary.

 

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Composition of the Board

We believe there should always be a substantial majority (75% or more) of independent directors and that the Chief Executive Officer should be a Board member. Other officers may, from time to time, be Board members, but no officer other than the Chief Executive Officer should expect to be elected to the Board by virtue of his or her position with the Company.

Selection of Director Nominees

The Board is responsible for selecting candidates for Board membership and for establishing the criteria to be used in identifying potential candidates. The Board delegates the screening process to the members of the Governance & Nominating Committee. For more information on the director nomination process, including the selection criteria, see the GulfMark Offshore, Inc. Governance & Nominating Policy available online at http://www.gulfmark.com/fw/main/Corporate-Governance-19.html.

We believe that it is important for our Board to be comprised of individuals with diverse backgrounds, skills and experiences. The composition of the Board and the experience, as well as the qualities, brought to the Board by our directors are reviewed annually. While the Governance & Nominating Committee does not have a formal diversity policy and identifies qualified potential candidates without regard to any candidate’s race, color, disability, gender, national origin, religion or creed, it does seek to ensure the fair representation of all stockholder interests on the Board.

The Board seeks independent directors who represent a mix of backgrounds and experiences that will enhance the quality of the Board’s deliberations and decisions. Nominees should have substantial experience with one or more publicly traded national or multinational companies or should have achieved a high level of distinction in their chosen fields.

The Board is particularly interested in maintaining a mix that includes the following backgrounds:

 

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active or retired chief executive officers and senior executives;

 

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experience in operations, finance, accounting, and/or banking;

 

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international business;

 

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oilfield services; and

 

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other oil and gas industry experience.

Finally, Board members should display the personal attributes necessary to be an effective director: integrity, sound judgment, independence, ability to operate collaboratively, and commitment to the Company and our stockholders. The Board believes that the use of these general criteria, along with a non-discriminatory policy, will best result in a Board that evidences that diversity in many respects. The Board believes that it currently maintains that diversity.

Separation of the Roles of Chairman of the Board and Chief Executive Officer

We believe that separating the role of Chairman of the Board of Directors from that of Chief Executive Officer can facilitate a clear delineation between the oversight responsibilities of the Board of Directors and the management responsibilities of the Chief Executive Officer. We also believe that the decision to separate these roles is dependent on the attributes of the two individuals involved. When properly constructed and constituted, the separation allows the Chairman of the Board to more readily manage the time requirements and distractions of general Board operations, routine contact with fellow directors between meetings, and can foster candor in evaluating Company and Chief Executive Officer performance. This provides the Chief Executive Officer with additional time to manage and execute the strategic plans for our business.

 

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Board Independence

Our Board has determined that all seven of the current non-management directors of the Company nominated for election as a director qualify as “independent” directors under the New York Stock Exchange corporate governance rules and that each member of the Audit Committee qualifies as “independent” under Rule 10A-3 of the United States Securities Exchange Act of 1934 (the “Exchange Act”). Each of the seven nominated non-management directors of the Company are also “non-employee directors” as defined under Exchange Act Rule 16b-3 and “outside directors” as defined in the Internal Revenue Code, section 162(m). Each committee described below in “Board Committees and Meetings” is comprised in full of independent non-management directors.

To be considered independent under the New York Stock Exchange rules, our Board affirmatively determined that all seven nominated non-management directors had no material relationship with the Company (either directly or as a partner, stockholder or officer of an organization that has a relationship with the Company). A director is not independent if:

 

•

the director was employed by the Company within the preceding three years;

 

•

an immediate family member of the director was an executive officer of the Company within the preceding three years;

 

•

the director or an immediate family member of the director received more than $120,000 per year, within the preceding three years, in direct compensation from the Company, other than director and committee fees and pension or other forms of deferred compensation for prior service (provided such service is not contingent in any way on continued service);

 

•

the director was affiliated with or employed by, or an immediate family member of the director was affiliated with or employed in a professional capacity by, a present or former internal or external auditor of the Company, within the preceding three years;

 

•

the director or an immediate family member of the director was employed, within the preceding three years, as an executive officer of another company where any of the Company’s present executives serve on that company’s compensation committee; or

 

•

the director is a current employee, or an immediate family member of the director is a current executive officer of a company that has made payments to, or received payments from, the Company for property or services in an amount which, in any of the last three fiscal years, exceeds the greater of $1 million, or 2% of such other company’s consolidated gross revenues.

The following is not considered by our Board to be a material relationship that would impair a director’s independence. No material relationship exists if a director is an executive officer of, or beneficially owns in excess of a 10% equity interest in, another company:

 

•

that does business with the Company, and the amount of the annual payments to the Company is less than five percent of the annual consolidated gross revenues of the Company, or $200,000, whichever is more;

 

•

that does business with the Company, and the amount of the annual payments by the Company to such other company is less than five percent of the annual consolidated gross revenues of the Company, or $200,000, whichever is more; or

 

•

to which the Company was indebted at the end of its last fiscal year in an aggregate amount that is less than five percent of the consolidated assets of the Company.

For relationships not covered by the guidelines in the immediately preceding paragraph, the determination of whether the relationship is material or not, and therefore whether the director would be independent or not, is made by our Board members who satisfy the independence guidelines described above.

 

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Approval of Related Person Transactions

Our Audit Committee is responsible for reviewing and approving the terms and conditions of all proposed transactions between us, any of our officers or directors, or relatives or affiliates of any such officers or directors, to ensure that any such related-party transaction is fair and is in our overall best interest. No transactions requiring approval occurred in 2011.

Board Committees and Meetings

Pursuant to our Bylaws, the Board has established several committees, including an Audit Committee, a Compensation Committee and a Governance & Nominating Committee. During the year ended December 31, 2011, the Board met seven times, the Audit Committee met ten times, the Compensation Committee met six times and the Governance & Nominating Committee met four times. During 2011, each director attended 75% or more of the total meetings of the Board and each director attended 75% or more of the total meetings of the committees on which such director served. Our policy regarding director attendance at the Annual Meeting is that directors are invited to attend, and that we will make all appropriate arrangements for directors that choose to attend. All directors then serving attended the 2011 Annual Meeting.

Audit Committee

We have an Audit Committee established in accordance with Section 3(a)(58)(A) of the Exchange Act. Messrs. Ford (Chairman), Gordon, and Bijur are the current members of the Audit Committee. The Board has determined that all of the Audit Committee members are “independent” as defined in the New York Stock Exchange listing standards applicable to the Company. Mr. Ford, by virtue of his financial, audit and accounting expertise gained as a partner in a top tier public accounting firm, has been designated as the Audit Committee financial expert within the meaning of Item 407(d)(5) of Regulation S-K. The Audit Committee’s function is to provide oversight. Its principal oversight responsibilities are to:

 

•

make recommendations to the Board concerning the selection and discharge of our independent auditors;

 

•

discuss with our internal auditors and independent auditors the overall scope and plans for their respective audits, including the adequacy of staffing and compensation; and

 

•

discuss with management, internal auditors and independent auditors the adequacy and effectiveness of our accounting and financial controls.

The Board adopted a written charter for the Audit Committee, which is posted on our website at www.gulfmark.com.

Executive Sessions of the Directors

Non-management directors meet in executive sessions following Board and committee meetings without any members of management being present and at which only those directors who meet the independence standards of the NYSE are present, provided however, that committees may, by invitation, meet with individual members of management, including our President and Chief Executive Officer, during executive sessions. Mr. Butters presides as chairman of each executive session of the Board unless the particular topic of the applicable executive session dictates that another independent director serve as chairman of the meeting. In the case of an executive session of the independent directors held in connection with a meeting of a committee of the Board, the chairman of the particular committee will preside as chairman of the executive session.

 

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Compensation Committee

Messrs. Butters (Chairman), Bijur, Gordon and Ross are the current members of the Compensation Committee. The functions of the Compensation Committee are to:

 

•

formulate, administer and periodically assess the Company’s compensation philosophy in light of actual pay practices, policies and programs;

 

•

review overall plan design for each of the major benefit programs;

 

•

retain independent advisors to assist the Compensation Committee in its role of assessing and administering these programs;

 

•

review and monitor succession plans for the President and Chief Executive Officer and our other officers, as well as the general policies and programs associated with development of our management team;

 

•

independently administer the compensation and benefit programs of the President and Chief Executive Officer;

 

•

annually review the compensation levels of our other officers using independent data and the President and Chief Executive Officer’s recommendations on compensation (other than his own) and make recommendations to the Board on salary changes, annual bonus plan provisions and payouts and equity grants; and

 

•

periodically review the components, administration and operation of our incentive compensation programs to ensure that no material risks exist that would or could promote excessive risk taking that could be detrimental to the Company or our stock.

The recommendations of the Compensation Committee are reviewed and subject to approval by the full Board, including a majority of our independent directors.

The Board adopted a written charter for the Compensation Committee, which is posted on our website at www.gulfmark.com.

Information regarding the processes and procedures for the consideration and determination of executive compensation may be found in the “Compensation Discussion and Analysis” on pages 15 to 26 of this Proxy Statement.

Governance & Nominating Committee

Messrs. Bijur (Chairman), Gimbel, Gordon and Ross are the current members of the Governance & Nominating Committee. The functions of the Governance & Nominating Committee are to:

 

•

develop and periodically review our governance principles;

 

•

identify new directors and annually recommend directors for election to the Board;

 

•

annually evaluate Board and Committee performance; and

 

•

review and recommend Board compensation for non-employee directors.

The Governance & Nominating Committee has not previously received any recommendations for director candidates from stockholders. The Governance & Nominating Committee will consider any candidate that has timely given written notice to our Secretary. If you would like to recommend a director candidate for consideration by our Governance & Nominating Committee you may submit your recommendation to our executive offices at GulfMark Offshore, Inc., 10111 Richmond Avenue, Suite 340, Houston, Texas 77042, Attn: Secretary. The notice should set forth as to each person you propose to nominate for election or reelection as a director:

 

•

all information required to be disclosed in solicitations of proxies for election of directors in a contested election, or is otherwise required under then-current SEC rules;

 

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•

a description of all direct and indirect compensation and other material monetary agreements during the past three years, and any other material relationships, between or among you or any person deemed to be associated with you, as described below (an “associated person”), if any, on the one hand, and such proposed nominee or his or her respective affiliates and associates on the other hand; and

 

•

completed and signed Director Representation and Agreement and Director Questionnaire with respect to the background and qualifications of such nominee, the forms of which you can obtain from us upon written request to our executive offices at the address set forth above.

An associated person includes (1) any of your affiliates or associates, (2) any beneficial owner of our Common Stock on whose behalf you make any proposal or nomination, and (3) any other person with whom you, the beneficial owner or any of your affiliates or associates has an agreement or understanding for the purpose of acquiring, holding, voting or disposing of our Common Stock or obtaining, changing or influencing the control of the Company.

In addition, you will need to provide the following information regarding yourself and any associated person:

 

•

any information that would be required to be disclosed in solicitations of proxies for the election of directors in a contested election, or is otherwise required under then-current SEC rules;

 

•

a representation that you are a holder of record of capital stock of the Company entitled to vote at such meeting and that you intend to appear in person or by proxy at the meeting to propose such nomination; and

 

•

a representation as to whether you or any associated person intends or is part of a group that intends to (1) deliver a Proxy Statement and/or form of proxy to holders of at least the percentage of the outstanding capital stock of the Company required to elect the nominee or (2) otherwise solicit proxies or votes from stockholders in support of such nomination.

For a full description of the process for nominating a director, see Section 1.13(a)(4) of our Bylaws.

The Governance & Nominating Committee identifies and evaluates director candidates in accordance with the director qualification standards described in our Governance & Nominating Policy, which can be found on our website, www.gulfmark.com. Candidates are selected for their character, judgment, business experience and acumen, as well as other factors established by the Governance & Nominating Committee in order to satisfy the qualifications for directors described above in the section titled “Selection of Director Nominees”.

The Board has adopted a written Governance & Nominating Committee charter, which is posted on our website at www.gulfmark.com.

Code of Business Conduct and Ethics

The Board adopted a Code of Business Conduct and Ethics applicable to all of our employees and agents as well as a Code of Ethics for our Principal Executive Officer and Senior Financial Officers, which are posted on our website at www.gulfmark.com. We intend to satisfy the disclosure requirement regarding any changes to our code of ethics we adopt and/or any waiver from our code of ethics that we grant by posting such information on our website, www.gulfmark.com, or by filing a Form 8-K for such event.

Availability of Corporate Governance Documents

Stockholders may obtain copies of the charters of the Audit Committee, the Compensation Committee, and the Governance & Nominating Committee, our Governance & Nominating Policy and our Codes of Business Conduct and Ethics free of charge by contacting the Company’s Secretary at the Company’s principal address of 10111 Richmond Avenue, Suite 340, Houston, Texas 77042, or by accessing our website at www.gulfmark.com, selecting the “Investor Relations” tab and then selecting “Corporate Governance”.

 

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DIRECTOR COMPENSATION

Fees and Awards

Each of our non-employee directors is paid $1,500 for each meeting of the Board and $1,500 for each Committee meeting of the Board he attends. In addition, during 2011, a retainer of $11,250 for each quarter was paid to each of our non-employee directors. We also have a retainer arrangement with Mr. Butters where he receives a retainer of $8,333 per month for serving as Chairman of the Board. We also have a retainer arrangement with Messrs. Ford, Butters and Bijur where each receives a retainer of $3,750, $2,500 and $2,500, respectively, per quarter for serving as Chairman of the Audit, Compensation and Governance & Nominating Committees, respectively. Each qualified non-employee director was granted 2,495 shares of restricted stock on June 7, 2011. Total compensation paid in 2011 to non-employee directors, including shares of restricted stock granted, director fees and retainers, matching under our GulfMark Offshore, Inc. Deferred Compensation Plan (the “EDC Plan”), and earnings under the EDC Plan is as follows:

 

Name		Fees Earned or Paid in Cash				Stock Awards(1)				Executive Deferred Compensation and Matching				Change in Pension Value and Non- qualified Deferred Compensation Earnings(2)				Total
Peter I. Bijur		$	95,500			$	100,000			$	14,325			$	3,593			$	213,418
David J. Butters			174,500				100,000				26,175				11,666				312,341
Brian R. Ford			85,500				100,000				12,825				23				198,348
Louis S. Gimbel, 3rd			61,500				100,000				9,225				—				170,725
Sheldon S. Gordon			85,500				100,000				12,825				—				198,325
Robert B. Millard			55,500				100,000				8,325				—				163,825
Rex C. Ross			70,500				100,000				10,575				342				181,417

 

(1)	Value based on the per share market value of our Common Stock on the grant date.

(2)	Represents deferred compensation earnings on amounts that the individual elects to defer where the earnings exceed a market rate specified by SEC rules.

Deferred Compensation Plan

The Company sponsors a deferred compensation plan whereby participants may elect to contribute a portion of their cash compensation, which is matched by the Company up to a certain point, and in which the Company may elect to make additional discretionary contributions. Contributions are generally not taxable to the participant until distributed, generally after retirement or resignation from the Company. Participants in the plan are generally the directors and senior management of the Company, including all persons described in this Proxy Statement.

Although discretionary, the Company has elected every year since inception of the plan to contribute 7.5% of a participant’s total cash compensation to the plan. In addition, contributions by the participants are matched dollar-for-dollar up to 7.5% of the participant’s total cash compensation.

Employee participants may elect to contribute up to 50% of their base salary and between 10% and 100% of their annual cash bonus. Director participants may elect to contribute up to 100% of their cash compensation. The first 7.5% of compensation contributed by participants must be used to purchase common stock of the Company, and all matching and discretionary contributions by the Company are made in common stock of the Company. Contributions by participants in excess of 7.5% of their cash compensation can be allocated into either common stock of the Company or an account in which the Company provides a return equivalent to the prime rate (as reported by the Federal Reserve) plus 2%.

 

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Participants are always fully vested in their contributions to the plan and vest in contributions made by the Company pro rata over five years. The plan’s assets are available to satisfy the claims of all our general creditors in the event of a bankruptcy or insolvency of the Company. Total compensation in 2011, which has been contributed by our directors, and contributions made by the Company in favor of these individuals, are as follows:

 

Name		Aggregate Balance at December 31, 2010				Director Contributions in 2011				Our Contributions in 2011				Aggregate Earnings in 2011				Aggregate Balance at December 31, 2011
Peter I. Bijur		$	673,668			$	95,500			$	14,325			$	75,969			$	859,462
David J. Butters			2,284,650				174,500				26,175				263,600				2,748,925
Brian R. Ford			30,162				8,550				12,825				10,873				62,410
Louis S. Gimbel, 3rd			207,818				30,750				9,225				80,203				327,996
Sheldon S. Gordon			790,750				42,750				12,825				303,171				1,149,496
Robert B. Millard			484,776				55,500				8,325				186,224				734,825
Rex C. Ross			218,692				70,500				10,575				69,021				368,788
Total		$	4,690,516			$	478,050			$	94,275			$	989,061			$	6,251,902

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

No member of our Compensation Committee is or was an officer or employee of the Company or any of our subsidiaries or had any relationship requiring disclosure under applicable rules. During 2011, none of our executive officers served as (1) a member of the compensation committee of another entity, one of whose executive officers served on the Compensation Committee of the Company, (2) a director of another entity, one of whose executive officers served on the Compensation Committee of the Company, or (3) a member of the compensation committee of another entity, one of whose executive officers served as a director of the Company.

CONTRIBUTIONS TO TAX EXEMPT ORGANIZATIONS

We have made no contributions to any tax exempt organization in which any independent director serves as an executive officer.

EXECUTIVE OFFICERS

The following are executive officers and key employees of the Company, who serve at the discretion of the Board:

 

Name		Position		Age
Bruce A. Streeter		President and Chief Executive Officer		63
Quintin V. Kneen		Executive Vice President and Chief Financial Officer		46
John E. (“Gene”) Leech		Executive Vice President—Operations		59
Richard M. Safier		Vice President—General Counsel and Secretary		57
Samuel R. Rubio		Vice President—Controller, Chief Accounting Officer and Assistant Secretary		52
David E. Darling		Vice President—Human Resources		57

Bruce A. Streeter’s biographical information can be found in “Proposal 1 – Election of Directors” on page 6 of this Proxy Statement.

Quintin V. Kneen was named Chief Financial Officer of the Company in June 2009. Mr. Kneen joined GulfMark in June 2008 as the Vice President – Finance and was named Senior Vice President – Finance and Administration in December 2008. Previously, he was Vice President-Finance & Investor Relations for Grant Prideco, Inc., serving in executive finance positions at Grant Prideco since June 2003. Prior to joining Grant Prideco, Mr. Kneen held executive finance positions at Azurix Corp. and was an Audit Manager with the Houston office of Price Waterhouse LLP. He holds an M.B.A. from Rice University and a B.B.A. in Accounting from Texas A&M University, and is a Certified Public Accountant and a Chartered Financial Analyst.

 

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John E. (“Gene”) Leech was named Executive Vice President – Operations of the Company in February 2001 after having served as Vice President – Operations from January 1997. He served as Vice President of our predecessor’s Marine Division from its formation in November 1990 until he became Vice President – Operations of the Company. Prior to November 1990, Mr. Leech was with Offshore Logistics, Inc. for a period of fifteen years serving in a number of capacities, including Manager Domestic Operations and International Operations Manager.

Richard M. Safier was named Vice President, General Counsel, and Corporate Secretary of the Company on March 15, 2011. Previously Mr. Safier was Vice President, General Counsel, and Corporate Secretary of T-3 Energy Services, Inc. from March 2006 until March 2011. Prior to joining T-3 Energy Services, Inc., Mr. Safier was the General Counsel and Corporate Secretary for a privately held Houston based software company and in addition held positions of increasing responsibilities in the offices of two Houston based law firms. Mr. Safier is a member of the State Bar of Texas.

Samuel R. Rubio was named Vice President – Controller and Chief Accounting Officer of the Company on December 31, 2008. Mr. Rubio joined the Company in 2005 as the Assistant Controller and was subsequently promoted to Controller in 2007. He has a B.B.A. degree from Sul Ross State University and is a Certified Public Accountant and a member of both the American Institute of Certified Public Accountants and the Texas Society of CPAs. In addition, Mr. Rubio has over 25 years of experience in accounting at both operating division and corporate levels as well as the management of accounting organizations.

David E. Darling was named Vice President – Human Resources of the Company on November 21, 2008 and has over 23 years of human resource experience. He came to the Company through our acquisition of Rigdon Marine, where he was employed as Human Resource Director since 2007. Prior to joining Rigdon Marine, Mr. Darling served as Executive Vice President of Human Resources for a wholly owned subsidiary of the Ford Motor Company which he joined in 2000. Additionally, Mr. Darling has 15 years of experience in the offshore vessel industry as Vessel Master, Operations Manager and Human Resources Manager with Zapata Gulf Marine and Tidewater, Inc. Mr. Darling earned his Bachelor of Science in Human Resources Management from Brenau University and his Master of Science in Human Resources Management and Labor Relations from the New York Institute of Technology.

COMPENSATION DISCUSSION AND ANALYSIS

Executive Summary

This Compensation Discussion and Analysis provides information regarding the 2011 compensation program in place for our President and Chief Executive Officer, our Chief Financial Officer, and our three other most highly-compensated executive officers. This section includes information regarding our compensation philosophy and objectives, the components of our compensation program, and the key factors the Compensation Committee considered in determining the compensation for our named executive officers in 2011.

The components of our compensation program are as follows:

 

Type		Form		Terms
Cash		- Salary		- Set annually based on market conditions, peer data and other factors
		- Annual Non-Equity Incentive		- Linked to both Company-wide and individual performance but discretionary factors are also considered
Equity		- Long-Term Incentive Awards		- Restricted stock with restrictions lapsing in thirds on each anniversary of the date of grant over three years - Ability to grant options, but have chosen not to do so
Other		- Employment Agreements and Severance and Change of Control Arrangements		- Automatic yearly renewal of employment agreements unless 120 days notice provided - Change of Control payment equal to either two-and-a-half times for our President and Chief Executive Officer or two-times for our other top three named executive officers of the executive’s annual salary plus his prior year’s annual bonus on a change of control and a termination or adverse change in employment

 

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		- Deferred Compensation Plan		- Allows deferral of salary and bonus with a portion required to be in Company stock for distribution after retirement or resignation from the Company
		- Perquisites		- Vehicle and club membership for two named executive officers
		- Benefits		- On same terms as other employees, including our employee stock purchase plan - Our top three executives receive medical coverage from retirement to age 65 - The Company will reimburse Messrs. Streeter and Leech an amount equal to the premiums previously paid under their life insurance policies, provided they continue their employment with the Company until their retirement date as defined in the agreement
		- Indemnification Agreements		- Indemnification for four of our named executive officers provided the executive was acting in good faith and in the best interest of the Company

Highlights for 2011 compensation include

Our Compensation Committee determined that our President and Chief Executive Officer met the majority of his individual performance objectives in 2011 and established his individual performance factor at 80%. In addition, the Compensation Committee reviewed the financial and other results for the Company for 2011 and similarly established the Company-wide performance level at 80%.

The Compensation Committee met on March 14, 2012, and determined the 2012 annual salary, the 2011 non-equity incentive cash bonus and the number of shares comprising the 2011 long-term incentive award of restricted stock for our top three named executive officers. Our President and Chief Executive Officer determined the compensation for the other two named executive officers, which was approved by the Compensation Committee. Company policy presently is to issue restricted stock awards to all of our U.S. employees at the same time in March, therefore, all restricted stock awards, including those for our named executive officers, were granted on March 24, 2012, when the average of the high and low stock price was $46.76 per share.

Compensation Philosophy and Objectives

Our compensation philosophy is to set the fixed compensation of our senior executives competitively for their demonstrated skills and industry experience. Variable compensation, both annual and long-term, should reflect the results of performance against a combination of quantitative and subjective measures. The Compensation Committee targets the median of the peer group for all elements of pay, including base salary, annual incentive, and long-term incentives. Our compensation programs are designed so that years of superior performance are rewarded with payouts that are near the median of the market.

Our compensation and benefits programs are designed to achieve the following objectives:

 

•

Compensation should enable us to attract, motivate and retain talented executive officers capable of leading us in a competitive and changing industry and to align the interests of our executives with those of our stockholders to ensure long-term success and stockholder value.

 

•

Compensation should reflect the marketplace for talent. We strive to remain competitive with the pay of other peer companies with which we compete for talent.

 

•

Annual cash and equity awards should reflect progress towards Company-wide financial and personal goals that balance rewards for both short-term and long-term performance.

 

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Administration

Our executive compensation program is developed and administered by the Compensation Committee of the Board, which is comprised of four non-employee independent directors. The Compensation Committee is responsible for the review and approval of all aspects of our executive compensation program. The specific duties and responsibilities of the Compensation Committee are described in this Proxy Statement under “Our Board of Directors – Board Committees and Meetings – Compensation Committee”. The recommendations of the Compensation Committee are approved by the full Board, including a majority of the independent directors.

Setting Executive Compensation

The Compensation Committee analyzes the compensation practices of a group of peer companies, consisting of other publicly-traded companies in the energy industry, including offshore vessel operators, offshore drilling companies, oilfield services companies and oil and gas exploration and energy companies within a range of market cap and revenue size similar to us. The Compensation Committee uses the compiled data from the peer group as a general guideline for discussion. The overall goal of this process is to enable us to provide total compensation packages that are competitive with prevailing practices in our industry.

In determining compensation for our named executive officers, each element of our compensation program is compared against published data. Deloitte Consulting LLC (“Deloitte”) was engaged in 2011 to provide us with proxy analysis and overall compensation guidance. The Compensation Committee selected the following 14 companies (the “peer group”) against which to compare our executive compensation program:

 

Basic Energy Services, Inc.		Key Energy Services Inc.
Bristow Group Inc.		Lufkin Industries Inc.
C&J Energy Services, Inc.		Newpark Resources, Inc.
Exterran Holdings, Inc.		Seacor Holdings Inc.
Helix Energy Solutions Group, Inc.		Superior Energy Services, Inc.
Hornbeck Offshore Services, Inc.		Tetra Technologies Inc.
Ion Geophysical Corporation		Tidewater Inc.

The Compensation Committee reviews the composition of the peer group on an annual basis. The Compensation Committee may elect to modify the peer group in future periods to reflect best practices in executive compensation or changes in our business or the business of other companies, in and outside the peer group.

In 2011, Deloitte was retained to conduct an Executive Compensation Review comparing our compensation practices with those in our peer group. This information allowed the Compensation Committee to directly compare compensation and principal components for our named executive officers with those similarly situated officers in our peer group, as well as review aggregate compensation as compared to such group.

Role of the Chief Executive Officer in Executive Compensation Decisions

Our President and Chief Executive Officer works closely with the Compensation Committee providing his assessment and recommendations on the competitiveness of the programs, performance issues and challenges, and makes recommendations for consideration pertaining to the compensation of his executive team. He also determines the compensation for two of our named executive officers. The Compensation Committee takes these recommendations into consideration and either approves or works with the President and Chief Executive Officer to develop suitable proposals. The President and Chief Executive Officer does not, however, make, participate in, provide input for or make recommendations about his own compensation.

Setting Performance Measures

When setting performance goals and objectives, we attempt to use criteria that assess our performance against our peer group rather than absolute performance. This is based on the belief that our absolute performance can be affected both negatively and positively by industry factors over which our executives have no control, such as prices for oil and natural gas. We have developed the metrics described below as we feel they reflect performance against our peers with a balance of specific internal goals that will enhance our ability to grow and create further stockholder value.

 

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For additional detail regarding our performance measures and how they affect our executive compensation please see sections entitled “Non-Equity Incentive Plan Compensation” and “2011 Executive Compensation – 2011 Company Performance” below.

Performance Review

At the end of each year, calculations required to support achievement of compensation goals established by the Compensation Committee are also provided to the Compensation Committee. The Compensation Committee then reviews the performance of our top three named executive officers based on their achievement of the established objectives, contribution to our performance and individual performance. This review is shared with the President and Chief Executive Officer and recommendations for compensation are provided to the Board for consideration and approval.

For our other named executive officers, performance criteria is set at the beginning of the year and reviewed at the end of the year. Recommendations for compensation are approved by the President and Chief Executive Officer.

Compensation Program Components and Underlying Philosophy

An executive’s compensation typically consists of:

 

•

base salary paid in cash;

 

•

annual non-equity incentive paid in cash;

 

•

long-term incentive awards;

 

•

employment agreements and severance and change in control arrangements;

 

•

deferred compensation;

 

•

perquisites;

 

•

benefits; and

 

•

indemnification agreements.

The balance among these components is established annually by the Compensation Committee and is designed to recognize past performance, retain key employees and encourage future performance. For a breakdown of the mix of short term and long term compensation in 2011, please see the table included under the section entitled “Allocation of Short and Long-Term Compensation” below.

The Compensation Committee reviews and recommends the specific base salary and bonus compensation of our top three named executive officers, while Messrs. Safier’s and Rubio’s base salary and bonus compensation are determined by our President and Chief Executive Officer based on similar guidelines. The President and Chief Executive Officer recommends performance criteria for the named executive officers other than himself. Those executive officers do not participate in the deliberation process of the Compensation Committee. Our executive officers do participate in the review and award process for other key employees. The particular elements of the compensation programs for such persons are set forth in more detail below.

 

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Base Salary

Salary for our executive officers is reviewed and set annually based on the market practices observed within the peer group. Salary levels are adjusted to take into account job responsibility, job complexity, individual performance, cost of living and other relevant factors. We believe this component of pay is one of the most effective ways to attract and retain executives. We generally set our named executive officers’ base salaries to fall in the median of our peer group.

In addition to market practices, the Compensation Committee considers our overall salary increases that are established each year based on industry information and current economics. The objective is to allow for salary increases to retain, motivate and reward successful performance while maintaining affordability within our business plan. Though individual increases can be more or less than the budgeted percentage amount in a given year depending on individual performance, the aggregate of the increases must stay within budget in most cases. Exceptions can be made when executive officers are promoted and assume additional responsibilities.

Non-Equity Incentive Plan Compensation

We provide incentive compensation to our executive officers and key employees in the form of annual cash bonuses relating to financial and operational achievements during the prior year pursuant to the GulfMark Offshore, Inc. Incentive Base Compensation Plan for the purpose of retaining and motivating our executive officers and key employees. Cash bonus awards under our Incentive Base Compensation Plan are linked to individual performance, as well as the achievement of Company-wide and regional performance goals, and are designed to put a significant portion of total compensation at risk in order to motivate and retain our executive officers and key employees. This structure is designed to allow for a target total cash compensation opportunity (base salary plus non-equity incentive award) to be at or above the median when compared to our peer group.

The cash amounts of such bonuses for executive officers are determined by the Compensation Committee using the following formula:

 

Annual Salary

x

Bonus Target Percentage

x

Company- wide Performance Multiplier

x

Individual Performance Multiplier

=

Cash Bonus Amount

The Compensation Committee establishes an annual bonus target for each executive officer based upon a review of the competitive data for that position, level of responsibility and ability to impact our success. Individual executive officer bonus targets for our named executives, other than our President and Chief Executive Officer, range from 65% to 100% of base salary. Individual performance that meets expectations yields application of the individual’s bonus target percentage, and performance that exceeds expectations can result in bonuses that range up to 150% of base salary. The President and Chief Executive Officer’s bonus has no limit as the Compensation Committee believes there should be flexibility to award amounts in excess of base salary given attainment of significant achievements above the corporate and individual goals and objectives established for the year.

Individual performance criteria for our corporate financial officers’ incentive compensation decisions are based primarily on the assistance and performance of such persons in implementing corporate objectives within the scope of his or her responsibilities. In the case of operational officers, individual performance is primarily measured with regard to the operational results of the business operations for which such persons and their direct reports were responsible.

Company-wide and regional performance goals are based on operating income, exceeding the average peer group EBITDA margin, return on investment, safety performance and individual objectives specific to each named executive officer’s position. Although the achievement of certain financial objectives as measured by a business segment’s earnings are considered in determining incentive compensation, other subjective and less quantifiable criteria are also considered, such as market penetration, development of the fleet, and effectiveness of new information systems. In this regard, the Compensation Committee takes into account specific operational achievements that are expected to affect future earnings and results, or that had an identifiable impact on the prior year’s results. For additional detail regarding our performance metrics and our actual performance, please see the section entitled “2011 Executive Compensation—2011 Company Performance” below.

 

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Incentive Equity Plan

We also provide long-term incentive compensation to our executive officers and key employees through equity awards pursuant to our GulfMark Offshore, Inc. 2010 Omnibus Equity Incentive Plan. The use of equity awards is intended to provide incentives to our executive officers and key employees to work toward our long-term goals. Equity awards are not granted by the Compensation Committee as a matter of course as part of the regular compensation of any executive or key employee. The decision to grant an equity award is based on the perceived incentive that any such grant will provide and the benefits that the grant may have on long-term stockholder value.

Since 2004, equity awards granted by the Compensation Committee have been limited to restricted shares. Although the 2010 Plan provides flexibility to award different types of equity incentives, the Compensation Committee has chosen to award restricted stock instead of options or other equity awards because the Compensation Committee believes restricted stock awards create a higher level of retention and further align executive management and stockholder interests. The awards are granted around the same time each year, in March of the year following the performance year, which gives the Compensation Committee enough time to review the prior year performance. The restrictions on the shares awarded generally lapse in thirds on each anniversary of the date of grant over three years.

The number of shares awarded to each of our named executive officers is determined by the following formula:

 

(

Total Annual Base Salary

x

Target Equity Award Percentage

)

÷

Average High and Low Stock Price on Date of Award

=

Number of Shares Awarded

Employment Agreements and Severance and Change of Control Arrangements

We have entered into employment agreements with our top three executive officers: President and Chief Executive Officer; Executive Vice President and Chief Financial Officer; and Executive Vice President—Operations. We have also entered into an employment agreement and separate change of control agreement with our Vice President – General Counsel and Secretary. These employment agreements provide, among other things, for a minimum base salary for the executive, for the executive’s participation in our Incentive Base Compensation Plan and our incentive, savings, retirement and other benefit plans applicable to our executives generally, and for the perquisites described below. In addition, the agreements provide for certain severance payments in the event the executive is terminated without cause or terminates his employment for good reason, including as a result of a change of control, as provided in the agreements.

The purpose of the employment agreements is to:

 

•

ensure that we will have the continued dedication of the executive;

 

•

diminish the inevitable distraction of the executive resulting from the uncertainties and risks created by a pending or threatened change of control; and

 

•

to provide the executive with compensation and benefits arrangements that are competitive with those of other corporations.

The change of control provision included in each of the employment agreements for our top three executive officers and the change of control agreement for our Vice President – General Counsel and Secretary requires a double trigger in order to receive any payment in the event of a change of control situation. First, a change of control must occur, and second the individual must terminate his employment for good reason or we must terminate his employment without cause within six months prior to or one year following the change of control event. We believe providing a change of control protection ensures impartiality and objectivity of our top three named executive officers and our Vice President – General Counsel and Secretary in the context of a change of control situation and protects the interests of our stockholders.

 

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Deferred Compensation

We provide our executives with the opportunity to defer certain portions of their salary and bonuses paid by us for distribution after retirement or resignation through our EDC Plan. The EDC Plan is intended to encourage the continued employment of the participating employees and to facilitate the recruiting of executive officers and other highly compensated employees required for our continued growth and profitability. Deferred compensation can be used to purchase shares of our Common Stock or may be retained by us and earn interest. We may match certain of the executive’s deferred compensation that is used to purchase Common Stock, and any matching portion will vest over time based on the individual officer’s years of service. Our executives’ benefits and participation in the EDC Plan are described in “Deferred Compensation” on page 31 of this Proxy Statement.

Perquisites

We provide our executives with perquisites and other personal benefits that we and the Compensation Committee believe are reasonable and consistent with our overall compensation program. Executives are provided with the following benefits as a supplement to their other compensation:

 

•

Use of vehicle: We provide each of Messrs. Streeter and Leech with a company vehicle for use for travel to and from the office and business-related events. We pay for all maintenance, insurance and gasoline for such vehicles; and

 

•

Use of club membership: We pay for the monthly membership fees for certain golf or social clubs for Messrs. Streeter and Leech. We encourage management to belong to a golf or social club so that they have an appropriate entertainment forum for customers and vendors.

Benefits

Our executive officers participate in our other benefit plans on the same terms as other employees. These plans include a defined contribution plan, our 401(k) plan, for which we match up to 100% of the first 5% of salary contributed by the employee, medical, dental, term life insurance, and our employee stock purchase plan. Messrs. Streeter, Leech and Kneen will also be provided with medical coverage from the date of retirement until they attain age 65.

In addition, the Company entered into agreements in January 2000, which have been amended in 2010 and 2012, to reimburse Messrs. Streeter and Leech for premiums paid under two life insurance policies since their inception in 1990 through June 30, 2011, provided they continue their employment with the Company until their retirement date as defined in the agreement. The aggregate amounts to be paid to Messrs. Streeter and Leech upon retirement are $329,000 and $314,000 (plus accumulated interest), respectively.

Indemnification Agreements

We have entered into indemnification agreements with Messrs. Streeter, Leech, Kneen and Rubio and our independent directors. These agreements provide for us to, among other things, indemnify the individual to the fullest extent permitted by applicable law against certain liabilities that may arise by reason of his or her relationship with us, provided he or she was acting in good faith and in a manner he or she reasonably believed to be in or not opposed to our best interests. The agreements further provide for us to advance reasonable expenses incurred by the individual in connection with proceedings covered by the agreement. In addition, we have agreed to use all commercially reasonable efforts to maintain a directors’ and officers’ liability insurance policy covering our directors and officers for losses from wrongful acts and omissions. The indemnification rights provided for in the indemnification agreements are in addition to the indemnification rights provided under our governing documents.

 

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Stock Ownership Guidelines

Our Board has adopted stock ownership guidelines for our directors and executives, which are incorporated in our Governance & Nominating Policy and can be found on our website, www.gulfmark.com and can be accessed by first selecting “Investor Relations” and then selecting “Corporate Governance”. The guidelines require our directors and executive officers to hold the following values in the form of our Common Stock (the director’s annual base compensation or the executive’s base salary is multiplied by the appropriate multiple):

 

•

6x for the chief executive officer,

 

•

5x for all directors,

 

•

3x for the executive vice presidents, and

 

•

2x for all other named executive officers.

Ownership of the guideline amounts must be maintained for as long as the director or executive officer is subject to the guidelines, subject to a three year phase in from the date of appointment of the director or executive officer. All of our named executive officers and directors are in compliance with the stock ownership guidelines.

2011 Executive Compensation

Determination of 2011 Base Salary

In recommending base salaries for 2011, the Compensation Committee considered our overall salary increases that were established based on industry information and current economics. During the first quarter of 2011, the Compensation Committee approved base salaries for Messrs. Streeter, Kneen and Leech. The President and Chief Executive Officer established Messrs. Safier’s and Rubio’s 2011 base salaries. Relevant industry and market data were considered and executive compensation benchmark data derived from executive compensation surveys and information relating to our Broad peer group were reviewed when making salary determinations. Based on the analysis of this information and the goals and objectives described above in “Compensation Program Components and Underlying Philosophy – Base Salary”, the Compensation Committee and our President and Chief Executive Officer determined the following 2011 base salaries were reasonable:

 

Name		Title		2011 Base Salary
Bruce A. Streeter		President and Chief Executive Officer		$	630,109
Quintin V. Kneen		Executive Vice President and Chief Financial Officer			303,090
John E. (“Gene”) Leech		Executive Vice President—Operations			334,463
Richard M. Safier		Vice President—General Counsel and Secretary			245,000	(1)
Samuel R. Rubio		Vice President—Controller and Chief Accounting Officer and Assistant Secretary			213,000

 

(1)	Mr. Safier was employed on March 15, 2011. His 2011 annual base salary was $245,000, but he received only $194,886 in 2011.

2011 Company Performance

At the beginning of 2011, the Compensation Committee established a Bonus Target Percentage of 100% for each of Messrs. Leech and Kneen. No Bonus Target Percentage was established for our President and Chief Executive Officer as the Compensation Committee believes there should be flexibility to award amounts in excess of base salary given attainment of significant achievements above the corporate and individual goals and objectives established for the year. Our President and Chief Executive Officer established a Bonus Target Percentage of 100% for Mr. Safier and 65% for Mr. Rubio. The Compensation Committee’s Company-wide performance goals for 2011 were to:

 

•

Achieve operating income of $87.6 million;

 

•

Attain return on investment of 6.0%;

 

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•

Meet or exceed the rolling twelve months average peer group Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”) margin, as EBITDA is widely used by security analysts, creditors, investors and other interested parties in the evaluation of companies in our industry; and

 

•

Attain lost time incident frequency (LTIF) of less than 0.5 per million man hours.

The Compensation Committee also approved the individual performance evaluation criteria recommended by the President and Chief Executive Officer for the named executive officers other than himself. The goals and objectives for all named executive officers includes the specific Company-wide goals listed above as well as individual performance goals specific to his area of expertise and oversight, such as the implementation of a new corporate wide initiative, system or policy. The individual objectives for all other named executive officers are set by his direct supervisor.

In March 2012, the Compensation Committee reviewed our actual performance relative to the set Company-wide performance goals for 2011, which were:

 

•

Actual operating income of $78.5 million compared to the goal of $87.6 million;

 

•

Return on investment of 6.3% versus the goal of 6.0%;

 

•

EBITDA margin of 35.5% compared to peer group EBITDA margin of 26.9%; and

 

•

LTIF of 0.3 for all of the regions compared to the goal of less than 0.5.

Based on Company performance versus the performance goals as set forth above and certain other qualitative factors reflecting 2011 activity, the Compensation Committee set the Company-Wide Performance Multiplier at 80%. The Compensation Committee considered, among other factors, individual performance and the competitive market in the industry during 2011 and determined that, to reward individual achievement, maintain a competitive compensation package and retain high quality employees, we needed to pay competitive annual incentive bonuses for 2011, as further described below.

Chief Executive Officer Annual Cash Incentive Bonus

Based on the policies described above, the Compensation Committee reviewed all elements of Mr. Streeter’s total compensation for 2011, including his base salary, annual cash incentive bonus and long-term incentive award. Based on the Compensation Committee’s review, the Compensation Analysis conducted by Deloitte and other subjective factors, they found Mr. Streeter’s total compensation to be reasonable and below the median market range. Having reviewed the contribution that Mr. Streeter made to our performance in 2011, the Compensation Committee believed that he continued to demonstrate the integrity, planning and leadership qualities that the executive compensation program was designed to foster and reward. In light of the foregoing, the Compensation Committee concluded that Mr. Streeter’s Bonus Target Percentage should be 80%, his Individual Performance Multiplier should be 80%, and, based upon our Company-Wide Performance Multiplier of 80% and Mr. Streeter’s individual performance, he should receive an annual cash incentive bonus for his 2011 performance in the amount of $504,087.

Annual Cash Incentive Bonus of Other Named Executive Officers

The Compensation Committee reviewed all elements of total compensation for Messrs. Kneen and Leech for 2011 in the same manner as it reviewed the total compensation for our President and Chief Executive Officer. Our President and Chief Executive Officer reviewed all elements of total compensation for Messrs. Safier and Rubio in the same manner as the Compensation Committee. The Compensation Committee also considered recommendations from the President and Chief Executive Officer regarding total compensation for Messrs. Kneen, Leech, Safier and Rubio. In addition to the financial goals and objectives listed

 

23

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above, individual objectives for each named executive officer were reviewed, evaluated and considered by the Compensation Committee, or our President and Chief Executive Officer, as appropriate, and resulted in the annual cash incentive amount as set forth in the table below:

 

		Performance Company-Wide				Individual Multiplier				Annual Cash Incentive
Quintin V. Kneen			80	%			80	%		$	242,472
John E. (“Gene”) Leech			80	%			80	%			267,570
Richard M. Safier			80	%			100	%			179,295
Samuel R. Rubio			80	%			121	%			145,000

2011 Grants of Long-Term Incentive Awards

The Compensation Committee believes long-term incentive awards provide an effective means of executive retention and an incentive to build stockholder value. The determination of the number of shares granted is based on market compensation data as well as the executive’s responsibility and ability to influence the management and our performance.

For 2011, the Compensation Committee set the Target Equity Award Percentage at 200% for each of Messrs. Streeter, Leech and Kneen, and our President and Chief Executive Officer set the Target Equity Award Percentage at 200% for Mr. Safier and at 110% for Mr. Rubio.

Based on the performance of our Common Stock and the Compensation Committee’s review of competitive practices, our financial achievements and individual performance, the Compensation Committee determined awards under our 2010 Omnibus Incentive Equity Plan in the form of restricted stock to our named executive officers for performance in 2011 were reasonable.

Our policy is to issue restricted stock awards to all of our U.S. employees at the same time in March, therefore, all restricted stock awards, including those for our named executive officers, were granted on March 24, 2012, when the average of the high and low stock price was at $46.76 per share. The following table sets forth the value of restricted stock and the number of shares issued to each of our named executive officers:

 

Named Executive Officer		Value of Restricted Shares Awarded				Grant Date Stock Price				Restricted Shares Awarded
Bruce A. Streeter		$	1,260,234			$	46.76				26,954
Quintin V. Kneen			606,179				46.76				12,965
John E. Leech			668,924				46.76				14,307
Richard M. Safier			389,750				46.76				8,336
Samuel R. Rubio			234,289				46.76				5,011

The terms of the restricted stock grants are described in the “Outstanding Equity Awards at Year-End” table on page 29 of this Proxy Statement. No stock options were granted to any named executive officer in 2011.

 

24

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Allocation of Short and Long-Term Compensation

The Compensation Committee chose to allocate the compensation program for our executive officers and key employees between equity-based and non-equity-based compensation in order to balance the policies of supporting long-term performance measures while rewarding yearly performance goals. In 2011, the percentage of short-term to long-term benefits given to our named executive officers is listed below based on the 2011 Summary Compensation Table:

 

Name		Short-Term  Benefits(1)				Long-Term  Benefits(2)				Total
Bruce A. Streeter			53.6	%			46.4	%			100.0	%
Quintin V. Kneen			43.7	%			56.3	%			100.0	%
John E. (“Gene”) Leech			44.8	%			55.2	%			100.0	%
Richard M. Safier			48.1	%			51.9	%			100.0	%
Samuel R. Rubio			54.7	%			45.3	%			100.0	%

 

(1)	Short-Term Benefits include salary, bonus, non-equity incentive plan awards, insurance premiums paid, club dues, and personal use of our vehicles.

(2)	Long-Term Benefits include stock awards, matching amounts under the EDC Plan and retirement contributions.

Determination of 2012 Annual Base Salary and Incentive Bonus Potential

In March 2012, the Compensation Committee considered whether adjustments should be made to the base salaries and incentive bonus potential under the Incentive Base Compensation Plan for the named executive officers for 2012. The Compensation Committee adjusted each of Messrs. Streeter’s, Kneen’s and Leech’s base salary and incentive bonus potential based on individual performance, competitive norms, current market conditions and the other factors discussed under “Compensation Components and Underlying Philosophy – Base Salary” and “Compensation Components and Underlying Philosophy – Non-Equity Incentive Plan Compensation” above. The President and Chief Executive Officer determined that Messrs. Safier’s and Rubio’s 2012 compensation should be adjusted as set forth below based on the same factors used to determine the compensation of the other named executive officers. The following table sets forth the 2012 base salaries and the target incentive bonus potential (as a percentage of base salary) for the named executive officers.

 

Name		Title		2012 Base Salary				Percentage Increase Over 2011				Target 2012 Incentive Bonus (as a % of Base Salary)
Bruce A. Streeter		President and Chief Executive Officer		$	652,163				3.5	%				(1)
Quintin V. Kneen		Executive Vice President and Chief Financial Officer			313,698				3.5	%			100	%
John E. (“Gene”) Leech		Executive Vice President—Operations			346,168				3.5	%			100	%
Richard M. Safier		Vice President—General Counsel and Secretary			253,575				3.5	%			100	%
Samuel R. Rubio		Vice President—Controller and Chief Accounting Officer			220,455				3.5	%			65	%

 

(1)

The President and Chief Executive Officer has an unlimited incentive bonus potential as the Compensation Committee believes there should be flexibility to award amounts in excess of base salary given attainment of significant achievements above the corporate and individual goals and objectives established for the year.

 

25

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Tax Considerations

In certain situations, tax regulations limit the deductibility of executive compensation paid to executive officers. Compensation paid to any one executive in excess of $1,000,000 will not be deductible unless it is performance-based and paid under a plan that has been approved by stockholders consistent with the requirements of Section 162(m) of the Internal Revenue Code. The Compensation Committee periodically reviews the application of this legislation when reviewing executive compensation; however, the limitation on deductibility of executive compensation has not had a material impact on us to date, and the decision has been to retain the flexibility of the current approach in setting goals and applying discretion where and when required.

COMPENSATION COMMITTEE REPORT

The Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis included in this Proxy Statement with the management of GulfMark Offshore, Inc. Based on that review and discussion, the Compensation Committee has recommended to the Board that the Compensation Discussion and Analysis be included in this Proxy Statement.

Submitted by the Compensation Committee of the Board:

David J. Butters – Chairman of the Compensation Committee

Peter I. Bijur – Compensation Committee Member

Sheldon S. Gordon – Compensation Committee Member

Rex C. Ross – Compensation Committee Member

 

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2011 SUMMARY COMPENSATION TABLE

 

Name and Principal Position		Year				Salary				Stock Awards(1)				Non-Equity Incentive Plan Compensation(2)				Change in Pension Value and Nonqualified Deferred Compensation Earnings(3)				All Other Compensation(5)				Total
Bruce A. Streeter			2011			$	630,109			$	1,260,234			$	504,087			$	639			$	199,956			$	2,595,025
President and Chief			2010				610,275				760,511				427,195				290				167,190				1,965,461
Executive Officer			2009				592,250				681,990				350,000				243				219,320				1,843,803
Quintin V. Kneen			2011				303,090				606,179				242,472				—				98,144				1,249,885
Executive Vice			2010				293,550				718,568				267,135				—				101,643				1,380,896
President and Chief			2009				285,000				483,955				300,000				—				84,084				1,153,039
Financial Officer
John E. (“Gene”) Leech			2011				334,463				668,924				267,570				452				127,600				1,399,009
Executive Vice			2010				323,935				484,440				272,125				207				97,261				1,177,968
President—Operations			2009				314,500				262,302				200,000				179				125,946				902,927
Richard M. Safier			2011	(4)			194,886				389,750				179,295				—				16,044				779,975
VP—General Councel			2010	(4)			—				—				—				—				—				—
and Secretary			2009	(4)			—				—				—				—				—				—
Samuel R. Rubio			2011				213,000				234,289				145,000				—				62,755				655,044
VP—Controller			2010				200,000				259,233				120,000				—				53,940				633,173
and Chief Accounting			2009				175,000				139,033				90,000				—				51,695				455,728
Officer and Assistant
Secretary

 

(1)

For the 2011 stock award, the Compensation Committee met on March 14, 2012 and established a value for stock to be awarded to the named executive officers. Stock was awarded using an average of the high and low stock price on the grant date of the Common Stock, March 24, 2012, which was $46.76 per share. For the 2010 stock award, the Compensation Committee met on January 24, 2011 and established a number of shares to be awarded to each of the top three named executive officers. The other named executive officers stock awards were determined by a formula that included their total cash compensation and their target equity award percentage. All stock awarded for 2010 was valued based on the average of the high and low price on March 24, 2011, or $43.51 per share. Stock was awarded for 2009 in a similar manner as 2010.

(2)	Represents cash amounts for 2011 which are paid in 2012 under the Incentive Base Compensation Plan. The calculation is based on factors identified by the Compensation Committee and discussed in the “Compensation Discussion and Analysis” on pages 15 to 26 of this Proxy Statement.

(3)	Represents deferred compensation earnings on salary and other incentive awards that the individual elects to defer where the earnings exceed a market rate specified by SEC rules.

 

27

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(4)	Mr. Safier was employed by the Company on March 15, 2011. His 2011 annual base salary was $245,000, but he received only $194,886 in 2011.

(5)	All Other Compensation includes the following:

 

Name		Matching 401(k) Contributions				Insurance Policy Premiums				Club Dues				Personal Use of Company Vehicles				EDC Match				Total
Bruce A. Streeter		$	12,250			$	24,056			$	590			$	4,464			$	158,596			$	199,956
Quintin V. Kneen			12,250				360				—				—				85,534				98,144
John E. (“Gene”) Leech			12,250				22,256				—				2,106				90,988				127,600
Richard M. Safier			—				731				—				—				15,313				16,044
Samuel R. Rubio			12,250				552				—				—				49,953				62,755

AGREEMENTS RELATED TO EMPLOYMENT

We have agreements relating to employment with Messrs. Streeter, Kneen, Leech and Safier. Each agreement entitles the employee to be employed in his present position within the Company and to receive a minimum annual salary that is at least equal to his current salary. The current terms of the agreements for Messrs. Streeter, Kneen and Leech expire on December 31, 2012, and for Mr. Safier expires on March 15, 2013, provided that all four employment agreements will be automatically renewed for additional terms of one year each unless 120 days notice is given by us or the executive prior to termination of the then-current term. The employment agreements each provide that the executive will be eligible to participate in the Company’s bonus and other benefit plans and in the case of Messrs. Streeter and Leech, be reimbursed for a country club membership and the use of a company vehicle. Our agreements with Messrs. Streeter, Kneen, Leech and Safier further provide for certain severance payments and other termination benefits to the executives. Those payments and benefits are described in “Potential Payments upon Termination or Change of Control” beginning on page 31 of this Proxy Statement.

GRANTS OF PLAN-BASED AWARDS

The following table provides information concerning grants of restricted stock in 2012 based on 2011 compensation:

 

Name		Grant Date				All Other Stock Awards: Number of Shares of Stock or Units(1)(2)				Grant Date Fair Value of Stock and Options Awards
Bruce A. Streeter			3/24/2012				26,954			$	1,260,234
Quintin V. Kneen			3/24/2012				12,965				606,179
John E. (“Gene”) Leech			3/24/2012				14,307				668,924
Richard M. Safier			3/24/2012				8,336				389,750
Samuel R. Rubio			3/24/2012				5,011				234,289

 

(1)	Our restricted stock is issued under our 2010 Equity Incentive Plan and vesting is subject to continued employment with the Company and, while previous performance is considered in making the award, once awarded, the restricted stock is not tied to any level of performance requirements.

(2)	Restrictions on the restricted stock awarded lapse over three years, 1/3 per year.

 

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The following table provides information concerning grants of restricted stock in 2011 based on 2010 compensation.

 

Name		Grant Date				All Other Stock Awards: Number of Shares of Stock or Units(1)(2)				Grant Date Fair Value of Stock and Options Awards
Bruce A. Streeter			3/24/2011				17,479			$	760,511
Quintin V. Kneen			3/24/2011				16,515				718,568
John E. (“Gene”) Leech			3/24/2011				11,134				484,440
Richard M. Safier (3)			3/15/2011				4,000				177,560
Samuel R. Rubio			3/24/2011				5,958				259,233

 

(1)	Our restricted stock is issued under our 2010 Equity Incentive Plan and vesting is subject to continued employment with the Company and, while previous performance is considered in making the award, once awarded, the restricted stock is not tied to any level of performance requirements.

(2)	Restrictions on the restricted stock awarded lapse over three years, 1/3 per year.

(3)	Mr. Safier was not employed by the Company in 2010. The stock was awarded upon employment and all shares vest on March 15, 2014.

OUTSTANDING EQUITY AWARDS AT YEAR-END

The following table provides information concerning unexercised options and restricted stock that have not vested for each named executive officer as of December 31, 2011:

 

		Option Award												Stock Award
		Number of Securities Underlying Unexercised Options
Name		Exercisable				Option Exercise Price				Option Expiration Date				Number of Shares or Units of Stock That Have Not Vested				Market Value of Shares or Units of Stock That Have Not Vested(1)
Bruce A. Streeter			—				—				—				23,937	(2)		$	1,005,593
			—				—				—				16,151	(3)			678,504
			—				—				—				17,479	(4)			734,293
Quintin V. Kneen			—				—				—				4,915	(2)			206,479
			—				—				—				11,462	(3)			481,519
			—				—				—				16,515	(4)			693,795
John E. (“Gene”) Leech			40,000				17.44				2/27/12				—				—
			—				—				—				10,567	(2)			443,920
			—				—				—				6,212	(3)			260,966
			—				—				—				11,134	(4)			467,739
Richard M. Safier			—				—				—				4,000	(5)			168,040
Samuel R. Rubio			—				—				—				2,466	(2)			103,597
			—				—				—				3,293	(3)			138,339
			—				—				—				5,958	(4)			250,296

 

(1)	Value based on the market value of the Common Stock on December 31, 2011 which was $42.01 per share.

 

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(2)	Restricted stock award vests on March 13, 2012.

(3)	Restricted stock award vests 1/2 on each of March 24, 2012 and 2013.

(4)	Restricted stock award vests 1/3 on each of March 24, 2012, 2013, and 2014.

(5)	Restricted stock vests on March 15, 2014.

2011 OPTION EXERCISES AND STOCK VESTED

The table below provides information on stock option exercises and sales of vested stock options by our named executive officers during 2011, including the number of shares acquired upon exercise and the value realized, before payment of any applicable withholding tax and broker commissions.

 

		Option Awards								Stock Awards
Name		Number of Shares Acquired on Exercise				Value Realized in Exercise(1)				Number of Shares Acquired on Vesting				Value Realized on Vesting(1)
Bruce A. Streeter			100,000			$	2,660,700				45,630			$	721,747
Quintin V. Kneen			—				—				14,646				115,118
John E. (“Gene”) Leech			36,000				953,820				20,099				309,182
Richard M . Safier			—				—				—				—
Samuel R. Rubio			—				—				5,114				81,330

 

(1)	Value realized represents the difference between the fair market value of the shares at the time of exercise or vesting, as appropriate, and the exercise price or fair market value of the shares at the time of grant.

EQUITY COMPENSATION PLANS

The table below provides information relating to our equity compensation plans, all of which have been approved by our stockholders, as of December 31, 2011:

 

Number of Securities to be Issued upon Exercise of Outstanding Options, Warrants and Rights		Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights				Number of  Securities Remaining Available for Future Issuance Under Compensation Plans (Excluding Securities Reflected in First Column)
140,000(1)		$	19.14				945,444
282,162(2)

 

(1)	Related to the Amended and Restated 1993 Non-Employee Director Stock Option Plan, the 1997 Incentive Equity Plan, the 2011 Non-Employee Director Share Incentive Plan and the 2010 Omnibus Equity Incentive Plan.

(2)	Related to the shares held in the “rabbi” trust under the EDC Plan. As Common Stock is purchased by the trustee from amounts received through deferred compensation and Company match, there is no weighted-average exercise price or any securities available for future issuance.

 

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DEFERRED COMPENSATION

Deferred Compensation Plan

The Company sponsors a deferred compensation plan whereby participants may elect to contribute a portion of their cash compensation, which is matched by the Company up to a certain point, and in which the Company may elect to make additional discretionary contributions. Contributions are generally not taxable to the participant until distributed, generally after retirement or resignation from the Company. Participants in the plan are generally the directors and senior management of the Company, including all persons described in this Proxy Statement.

Although discretionary, the Company has elected every year since inception of the plan to contribute 7.5% of a participant’s total cash compensation to the plan. In addition, contributions by the participants are matched dollar-for-dollar up to 7.5% of the participant’s total cash compensation.

Employee participants may elect to contribute up to 50% of their base salary and between 10% and 100% of their annual cash bonus. Director participants may elect to contribute up to 100% of their cash compensation. The first 7.5% of compensation contributed by participants must be used to purchase common stock of the Company, and all matching and discretionary contributions by the Company are made in common stock of the Company. Contributions by participants in excess of 7.5% of their cash compensation can be allocated into either common stock of the Company or an account in which the Company provides a return equivalent to the prime rate (as reported by the Federal Reserve) plus 2%.

Participants are always fully vested in their contributions to the plan and vest in contributions made by the Company pro rata over five years. The plan’s assets are available to satisfy the claims of all our general creditors in the event of a bankruptcy or insolvency of the Company. Total compensation in 2011, which has been contributed by our named executive officers, and contributions made by the Company in favor of these individuals, is as follows:

 

Name		Aggregate Balance at December 31, 2010				Executive Contributions in 2011				Our Contributions in 2011				Aggregate Earnings in 2011(1)				Aggregate Balance at December 31, 2011
Bruce A. Streeter		$	1,886,829			$	89,978			$	158,595			$	684,841			$	2,820,243
Quintin V. Kneen			319,612				49,445				85,534				118,765				573,356
John E. (“Gene”) Leech			1,297,425				52,297				90,988				470,052				1,910,762
Richard M. Safier			—				7,656				15,313				691				23,660
Samuel R. Rubio			258,280				15,975				49,953				98,168				422,376

 

(1)

Aggregate earnings, which include interest, are included under the “Change in Pension Value and Nonqualified Deferred Compensation Earnings” column of the Summary Compensation Table only to the extent they exceed the market rate specified by SEC rules, as shown in footnote 3 to the Summary Compensation Table.

At December 31, 2011, we had a total deferred compensation liability of $5,750,396 to the above named executive officers under the EDC Plan.

POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE OF CONTROL

The following describes the amounts potentially payable to our named executive officers for fiscal year 2011 upon termination of employment or if we undergo a change of control. The amounts set forth in this section are estimates that are based on a number of assumptions. Actual amounts payable to our named executive officers could be materially different. The following discussion is based on each named executive officer’s agreements with the Company, salary level and restricted stock and stock option holdings as of December 31, 2011, and the benefits paid to the named executive officer during 2011 and assumes the termination or change of control occurs on December 31, 2011. In addition, it assumes a price per share of our Common Stock of $ 42.01, which was the closing price per share on December 31, 2011, as reported on the New York Stock Exchange.

 

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Bruce A. Streeter, Quintin V. Kneen and John E. Leech

Under Messrs. Streeter’s, Kneen’s and Leech’s respective employment agreements, each executive is entitled to receive termination benefits in the event he terminates his employment with us for “good reason” or is terminated without “cause” by us, either during the term of his agreement or during a “change of control” period, defined as the period beginning on the six month anniversary of a change of control and ending on the twelve month anniversary of a change of control.

The terms “cause,” “good reason,” and “change of control” are defined in the executives’ employment agreements and have the meanings generally described below. You should refer to the individual agreements for the actual definitions.

“Good reason” is defined as:

 

•

a significant reduction in the duties or responsibility of the executive or the assignment to him of duties materially inconsistent with his position;

 

•

relocation of more than 75 miles from his present business address; or

 

•

material breach by us of his employment agreement.

“Cause” is defined as:

 

•

the willful and continued failure by the executive to perform his duties;

 

•

the executive being convicted of or entering a plea of nolo contendere to the charge of a felony;

 

•

the commission by the executive of a material act of dishonesty or breach of trust resulting or intending to result in personal benefit or enrichment to the executive at the expense of the Company; or

 

•

an unauthorized absence from employment.

“Change-of-Control” generally means that:

 

•

the majority of the Board of Directors consists of individuals other than those serving as of the date of the named executive’s employment agreement or those that were not elected by at least 50% of those directors;

 

•

there has been a merger of the Company in which at least 50% of the combined post-merger voting power of the surviving entity does not consist of the Company’s pre-merger voting power;

 

•

at least 20% of our Common Stock has been acquired by one person or persons acting as a group; or

 

•

the Company is liquidating or selling all or substantially all of its assets.

If Mr. Streeter’s employment terminates as described above, he will be entitled to receive a payment equal to two-and-a-half times the sum of his annual base salary as then in effect and the prior year’s annual bonus, and all stock options and restricted stock not then vested or exercisable, as the case may be, will immediately vest and become fully exercisable. If Mr. Kneen’s or Mr. Leech’s employment terminates, he will be entitled to receive a payment equal to two times the sum of his annual base salary as then in effect and the prior year’s annual bonus, and all stock options and restricted stock not then vested or exercisable, as the case may be, will immediately vest and become fully exercisable. Each of Messrs. Streeter, Kneen and Leech will also receive his annual base salary through the date of termination, a portion of the prior year’s annual bonus, any compensation previously deferred, and any accrued vacation pay.

 

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If any payment or distribution to Messrs. Streeter, Kneen, or Leech would be subject to the excise tax imposed by Section 4999 of the Code, or any successor provision thereto, or any interest or penalties are incurred by him for the excise tax, then he is entitled to receive an additional payment (a “Gross-Up Payment”) in an amount such that after payment of all taxes (including any interest or penalties imposed), including any income taxes (and any interest and penalties imposed with respect thereto) and any excise tax imposed upon the Gross-Up Payment, he retains an amount of the Gross-Up Payment equal to the excise tax imposed upon the payments.

Additionally, if Messrs. Streeter, Leech or Kneen is terminated during a change of control period, he and his family will receive, for the remainder of his employment agreement, welfare benefit plans at least equal to those provided during his employment. For six months after termination, we will promptly reimburse him for reasonable expenses incurred for outplacement services and/or counseling. Messrs. Streeter or Leech may also use, at his full expense, the Company automobile for six months after termination or until he is employed elsewhere.

The following table describes the potential payments upon termination, a change of control of the Company or the death or disability of Mr. Streeter, our President and Chief Executive Officer:

 

Executive Benefits and Payments Upon Termination		Termination by the  Executive for Good Reason				Termination without  Cause				Termination Upon Change  of Control				Death or Disability
Compensation:
Base Salary ($630,109)		$	1,575,273			$	1,575,273			$	1,575,273			$	—
Bonus ($427,195)			1,067,988				1,067,988				1,067,988				—
Gross Up Payment			—				—				—				—
Medical Benefits			34,333				34,333				34,333				34,333
Vacation			60,587				60,587				60,587				60,587
Automobile			9,403				9,403				9,403				9,403
Long-term incentives:
Restricted Stock: Unvested			2,418,390				2,418,390				2,418,390				2,418,390
Supplemental Income Plan			348,072				348,072				348,072				248,072
Total		$	5,514,046			$	5,514,046			$	5,514,046			$	2,770,785

The following table describes the potential payments upon termination, a change of control of the Company or the death or disability of Mr. Kneen, our Executive Vice President and Chief Financial Officer:

 

Executive Benefits and Payments Upon Termination		Termination by the  Executive for Good Reason				Termination without  Cause				Termination Upon Change  of Control				Death or Disability
Compensation:
Base Salary ($303,090)		$	606,180			$	606,180			$	606,180			$	—
Bonus ($267,135)			534,270				534,270				534,270				—
Gross Up Payment			663,286				663,286				663,286				—
Medical Benefits			452,002				452,002				452,002				452,002
Vacation			23,315				23,315				23,315				23,315
Long-term incentives:
Deferral Compensation: Unvested			144,539				144,539				144,539				144,539
Restricted Stock: Unvested			1,381,792				1,381,792				1,381,792				1,381,792
Total		$	3,805,384			$	3,805,384			$	3,805,384			$	2,001,648

 

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The following table describes the potential payments upon termination, a change of control of the Company or the death or disability of Mr. Leech, our Executive Vice President – Operations:

 

Executive Benefits and Payments Upon Termination		Termination by the Executive for Good Reason				Termination without Cause				Termination Upon Change of Control				Death or Disability
Compensation:
Base Salary ($334,463)		$	668,926			$	668,926			$	668,926			$	—
Bonus ($272,125)			544,250				544,250				544,250				—
Gross Up Payments			—				—				—				—
Medical Benefits			142,069				142,069				142,069				142,069
Vacation			32,160				32,160				32,160				32,160
Automobile			13,225				13,225				13,225				13,225
Long-term incentives:
Stock Options: Unvested			1,172,625				1,172,625				1,172,625				1,172,625
Supplemental Income Plan			331,838				331,838				331,838				331,838
Total		$	2,905,093			$	2,905,093			$	2,905,093			$	1,691,917

Richard M. Safier

Mr. Safier entered into a Change of Control Agreement with us on March 15, 2011. The current term of the agreement expires March 15, 2013, provided that the agreement will be automatically renewed for additional terms of one year unless 120 days notice is given by us prior to termination of the then-current term. Under Mr. Safier’s Change of Control Agreement, he is entitled to receive termination benefits in the event he terminates his employment with us for “good reason” or is terminated without “cause” by us after a “change of control” has occurred and during the term. Consistent with Board policy, Mr. Safier’s Change of Control Agreement does not include any Gross-Up Payments.

The terms “cause,” “good reason,” and “change of control” are defined in Mr. Safier’s Change of Control Agreement and has the meanings generally described below. You should refer to his Change of Control Agreement for the actual definitions.

“Good reason” is defined as:

 

•

a substantial diminution of duties or responsibilities as compared to the duties and responsibilities immediately prior to a change of control or a material change in reporting responsibilities, titles or offices as in effect immediately prior to a change of control;

 

•

a reduction of annual base salary and compensation, except for across-the-board reductions;

 

•

relocation of more than 50 miles from his present business address immediately prior to a change of control; or

 

•

failure by the Company to continue compensation plans or benefits substantially similar to those immediately prior to a change of control.

 

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“Cause” is defined as:

 

•

the willful and continued failure by the executive to perform his duties; or

 

•

the willful engaging by the executive in conduct which is demonstrably and materially injurious to the Company.

“Change-of-Control” generally means that:

 

•

the majority of the Board of Directors consists of individuals other than those serving as of the date of the named executive’s employment agreement or those that were not elected by at least 50% of those directors;

 

•

there has been a merger of the Company in which at least 50% of the combined post-merger voting power of the surviving entity does not consist of the Company’s pre-merger voting power;

 

•

at least 20% of our Common Stock has been acquired by one person or persons acting as a group; or

 

•

the Company is liquidating or selling all or substantially all of its assets.

If Mr. Safier’s employment terminates as described above, he will be entitled to receive a payment equal to two times the sum of his annual base salary as then in effect, an amount equal to 12 times the monthly premiums amounts for his group medical coverage, and all restricted stock not then vested or exercisable, as the case may be, will immediately vest and become fully exercisable. Mr. Safier will also receive his annual base salary through the date of termination, a portion of the prior year’s annual bonus, any accrued vacation pay, and an amount equal to the two year value of contributions we would have made under our 401(k) Plan and Executive Deferred Compensation Plan on behalf of Mr. Safier had he continued to be an employee. For six months after termination, we will promptly reimburse him for reasonable expenses incurred for outplacement services.

The following table describes the potential payments upon termination, a change of control of the Company or the death or disability of Mr. Safier, our Vice President—General Counsel:

 

Executive Benefits and Payments Upon Termination		Termination by the Executive for Good Reason				Termination without Cause				Termination Upon Change of Control				Death or Disability
Compensation:
Base Salary ($245,000)		$	490,000			$	490,000			$	490,000			$	—
Bonus (not applicable)(1)			—				—				—				—
Medical Benefits			184,001				184,001				184,001				184,001
Vacation			18,846				18,846				18,846				18,846
Long-term incentives:
Deferred Compensation: Unvested			15,773				15,773				15,773				15,773
Restricted Stock: Unvested			168,040				168,040				168,040				168,040
Total		$	876,660			$	876,660			$	876,660			$	386,660

 

(1)	Mr. Safier was not employed in 2010 and therefore, did not receive a bonus in 2011.

Samuel R. Rubio

Mr. Rubio does not have an employment agreement. His rights under a change of control are governed by our Severance Benefits policy applicable to all employees of the Company and are contingent on an equal position not being made available within nine months of the change of control event. Mr. Rubio would receive twelve months salary, which was $213,000 at December 31, 2011, if the conditions of the change of control event are

 

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satisfied under the policy. All employee equity based plans currently provide for immediate vesting of all options and restricted stock on a change of control, which would result in 11,718 shares of restricted stock vesting with a value of $492,273 at December 31, 2011, based on the closing price per share of $42.01. Therefore, the total amount Mr. Rubio would receive under a change of control, assuming such change of control occurred on December 31, 2011, would be $705,273.

AUDIT COMMITTEE REPORT

We have reviewed and discussed the audited financial statements of GulfMark Offshore, Inc., for the year ended December 31, 2011 with management and have discussed with KPMG LLP (“KPMG”), our independent auditors for the year ended December 31, 2011, the matters required to be discussed by the statement on Auditing Standard No. 114, The Auditors Communication with Those Charged with Governance, as amended or supplemented with respect to those statements, and the requirements of the Public Company Accounting Oversight Board.

We have received the written disclosures and the letter from KPMG required by applicable requirements of the Public Company Accounting Oversight Board regarding KPMG’s communications with the audit committee concerning independence, and have discussed with KPMG its independence in connection with its audit of our most recent financial statements.

We also reviewed and discussed such other matters as we deemed appropriate, including the Company’s compliance with Section 404 of the Sarbanes-Oxley Act of 2002 and rules adopted or proposed to be adopted by the Securities and Exchange Commission.

Based on the foregoing review and discussion, and relying on the representation of Company management and the independent registered public accounting firm’s report, we recommended to the Board that such audited financial statements be included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2011 filed with the Securities and Exchange Commission.

Brian R. Ford, Chairman of Audit Committee

Sheldon S. Gordon, Audit Committee Member

Peter I. Bijur, Audit Committee Member

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Exchange Act requires our officers and directors, and persons who own more than 10% of a registered class of our equity securities, to file reports of ownership and changes in ownership with the Securities and Exchange Commission. Officers, directors and greater than 10% stockholders are required by the regulation to furnish us with copies of all Section 16(a) forms they file.

Based solely on our review of the copies of such forms received, or written representations from certain reporting persons that no Form 5 reports were required for those persons, we believe that all filing requirements applicable to our officers and directors and greater than 10% owners were complied in 2011, except for a Form 5 filed by Mr. Millard related to shares gifted to charitable organizations in 2005 and 2007.

PROPOSAL 2

APPROVAL BY A STOCKHOLDER NON-BINDING ADVISORY VOTE OF THE COMPENSATION PAID BY US TO OUR NAMED EXECUTIVE OFFICERS, COMMONLY REFERRED TO AS A “SAY ON PAY” PROPOSAL

As required under the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, and as approved by the Company stockholders at the June 7, 2011 Annual Meeting, our Board is submitting the 2011 compensation of our named executive officers proposal to our stockholders for consideration. This proposal provides our stockholders with the opportunity to cast an advisory, non-binding vote on our executive compensation program. Our overall compensation program is intended to ensure that the compensation and incentive

 

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opportunities provided to our executives and employees remain competitive and provide the motivation to deliver efforts that lead to returning value to our stockholders. The primary objective of our executive compensation program is to provide competitive pay opportunities that are commensurate with our performance, that recognize individual initiative and achievements and that enable us to retain and attract qualified executive officers who are focused on our goals and long-term success.

The Board invites you to review carefully the Compensation Discussion and Analysis beginning on page 15 and the tabular and other disclosures on compensation under the discussion of our executive compensation program beginning on page 27. Based upon that review, the Board recommends that the stockholders approve the following advisory resolution to approve executive compensation at the Annual Meeting:

“RESOLVED, that the compensation paid to the Company’s named executive officers, as disclosed pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including the compensation discussion and analysis, the compensation tables and any related material disclosed in this Proxy Statement, is hereby APPROVED.”

While the vote does not bind the Board to any particular action, the Board values the input of our stockholders, and will take into account the outcome of this vote in considering future compensation arrangements.

Assuming the existence of a quorum, non-binding approval of the compensation paid to our named executive officers by stockholders requires the affirmative vote of a majority of the shares of Common Stock entitled to vote on the proposal. Abstentions will be treated as a vote against this proposal and broker non-votes will be disregarded and have no effect on the outcome of the vote.

THE BOARD RECOMMENDS A VOTE “FOR” APPROVAL OF THE COMPENSATION PAID BY US TO OUR NAMED EXECUTIVE OFFICERS AS DESCRIBED IN THIS PROXY STATEMENT.

PROPOSAL 3

RATIFICATION OF OUR INDEPENDENT PUBLIC ACCOUNTANTS

KPMG has served as our principal independent registered public accounting firm for the year ended December 31, 2011, after replacing UHY as a result of a competitive “request for proposal” process undertaken by the Audit Committee. UHY, and its predecessor UHY Mann Frankfort Stein & Lipp LLP, served as our principal independent registered public accounting firm from December 31, 2005 through December 31, 2010. The decision to change our independent registered accounting firm was made by the Audit Committee on March 14, 2011 and was subsequently ratified and approved by the Board of Directors on March 17, 2011. UHY’s reports on the Company’s financial statements for the year ended December 31, 2010, did not contain an adverse opinion or disclaimer of opinion, nor were such reports qualified or modified as to uncertainty, audit scope, or accounting principles. During the year ended December 31, 2010, there were no disagreements with UHY on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which if not resolved to the satisfaction of UHY, would have caused it to make a reference to the subject matter of the disagreement(s) in connection with its reports covering such periods.

We are asking our stockholders to ratify the selection of KPMG LLP as our independent auditor. Although ratification is not required by our Bylaws or otherwise, the Board is submitting the selection of KPMG LLP to our stockholders for ratification as a matter of good corporate practice. Even if the selection is ratified, the Audit Committee in its discretion may select a different registered public accounting firm at any time during the year if it determines that such a change would be in our best interests and in the best interests of our stockholders.

KPMG LLP will have representatives present at the Annual Meeting who will have the opportunity to make a statement if they so desire and will be available to respond to appropriate questions.

 

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Audit fees billed for the last two years for professional services rendered by KPMG in 2011 and UHY in 2010, are set forth on the table below:

 

		Year Ended December 31,
		2011				2010
Audit Fees(1)		$	815,000			$	799,818
Audit-Related Fees(2)			185,400				30,037
Tax Fees(3)			—				8,284
Total		$	1,000,400			$	838,139

 

(1)

Relates to services rendered in connection with auditing our annual consolidated financial statements and our internal controls over financial reporting for each applicable year and reviewing our quarterly financial statements. Also, includes services rendered in connection with statutory audits and financial statement audits of our subsidiaries and expenses.

(2)	Relates to 401(k) plan audits and procedures performed to provide comfort to underwriters for a debt securities offering.

(3)	Relates to foreign tax compliance and consultation services.

The Audit Committee approves all audit and tax services provided by our independent auditor prior to the engagement of the independent auditor with respect to such services. The Audit Committee’s pre-approval policy provides for pre-approval of specifically described audit related and other services by the Chairman of the Audit Committee with respect to the permitted services. None of the services described above were approved by the Audit Committee under the de minimis exception provided by
Rule 2-01(c)(7)(i)(C) under Regulation S-X.

Required Vote for Ratification of Our Independent Public Accountants

Ratification of KPMG LLP as our registered independent public accounting firm will require the vote of the holders of a majority of the shares of Common Stock present or represented by proxy and entitled to vote at a meeting at which a quorum is present. Broker non-votes will be counted as a “for” vote for this proposal. Abstentions will have the same effect as an “against” vote for this proposal.

BOARD RECOMMENDATION

THE BOARD RECOMMENDS A VOTE “FOR” RATIFICATION OF KPMG LLP AS OUR INDEPENDENT PUBLIC ACCOUNTANTS.

PROPOSALS BY STOCKHOLDERS AND STOCKHOLDER COMMUNICATIONS

We anticipate that our 2013 Annual Meeting will be held in the first week of June 2013. Any stockholder wishing to present a proposal for consideration at the meeting must submit it so that notice will be received by us no earlier than close of business on February 7, 2013, and no later than the close of business on March 9, 2013. Such proposal must comply with the proxy rules promulgated by the SEC in order to be included in our Proxy Statement and form of Proxy related to the meeting and should be sent to our Secretary at our principal executive offices at the address set forth on the cover of this Proxy Statement. If notice of any stockholder proposal not eligible for inclusion in our Proxy Statement and form of Proxy is given to us after March 9, 2013, then proxy holders will be allowed to use their discretionary voting authority on such stockholder proposal when the matter is raised at such meeting. In no event will the public announcement of an adjournment or postponement of an annual meeting commence a new time period (or extend any time period) for the giving of a stockholder’s notice as described above.

For more information regarding stockholder proposal deadlines, please see Section 1.13(a)(2) of our Bylaws.

 

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Except as described below, the Board does not have a formal process for stockholders or interested parties to send communications to the Board or non-management directors as a group. Due to the infrequency of stockholder or interested party communications to the Board, the Board does not believe that a formal process is necessary. The Board will review periodically whether a more formal policy should be adopted. Written communications to the Board may be sent to our executive offices at GulfMark Offshore, Inc., 10111 Richmond Avenue, Suite 340, Houston, Texas 77042, and we will promptly circulate such communications to all members of the Board (or to those particular directors to whom such communication is specifically addressed). Such communications will be screened to the extent necessary in order to ascertain the intended recipients or appropriate recipients among the members of the Board. Director nominations and other matters a stockholder proposes for consideration at the meeting must be timely submitted, comply with the requirements set forth in our Bylaws, and be sent to the Secretary’s attention at our executive office address set forth above.

The Board has established several methods of communicating concerns to our Board. Concerns regarding financial statements, accounting practices, or internal controls should be addressed to the Chairman of the Audit Committee, in care of the Secretary, GulfMark Offshore, Inc., 10111 Richmond Avenue, Suite 340, Houston, Texas 77042. Concerns regarding governance practices, ethics and code of conduct should be addressed to the Chairman of the Nominating & Governance Committee, in care of the Secretary, GulfMark Offshore, Inc., 10111 Richmond Avenue, Suite 340, Houston, Texas 77042. The interested party may alternatively anonymously submit such communications through the Global Compliance Online Reporting System. The Global Compliance Online Reporting System may be accessed on the internet at https://gulfmark.alertline.com. The interested party should click on “Report a Concern” and complete the rest of the form as appropriate. The communication process is also further detailed on our website, www.gulfmark.com, along with other of our corporate governance guidelines, and is available in print to any stockholder who requests it.

 

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OTHER BUSINESS

Neither the Board nor the Company know of any other business that will be brought before the meeting. If, however, any other matters are properly presented, it is the intention of the persons named in the accompanying form of proxy to vote the shares covered thereby as, in their discretion, they may deem advisable.

 

Houston, Texas

Date: April 27, 2012

 

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ANNUAL MEETING OF STOCKHOLDERS OF

GULFMARK OFFSHORE, INC.

June 7, 2012

 

		PROXY VOTING INSTRUCTIONS

 

INTERNET - Access “www.voteproxy.com” and follow the on-screen instructions. Have your proxy card available when you access the web page, and use the Company Number and Account Number shown on your proxy card.				COMPANY NUMBER
Vote online until 11:59 PM EDT the day before the meeting.   MAIL - Sign, date and mail your proxy card in the envelope provided as soon as possible.				ACCOUNT NUMBER
IN PERSON - You may vote your shares in person by attending the Annual Meeting.

 

Important Notice Regarding the Availability of Proxy Materials for the Stockholders Meeting of GulfMark Offshore, Inc. to Be Held on June 7, 2012.   The Proxy Statement dated April 27, 2012, Form of Proxy, and the GulfMark Offshore, Inc. 2011 Annual Report to Stockholders for the year ended December 31, 2011 are available at http://www.proxydocs.com/GLF

Please detach along perforated line and mail in the envelope provided IF you are not voting via the Internet.

 

THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” THE ELECTION OF DIRECTORS AND “FOR” PROPOSALS 2 AND 3.   PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HERE  x

FOR

AGAINST

ABSTAIN

1. To elect eight (8) directors.

2.

To vote on a proposal to approve, by a stockholder non-binding advisory vote, the compensation paid by us to our named executive officers, commonly referred to as a “Say-on-Pay” proposal.

¨

¨

¨

NOMINEES:

¨

FOR ALL NOMINEES

O     Peter I. Bijur O     David J. Butters O     Brian R. Ford O     Louis S. Gimbel, 3rd O     Sheldon S. Gordon O     Robert B. Millard O     Rex C. Ross O     Bruce A. Streeter

3.

To vote on a proposal to ratify the selection of KPMG LLP as the Company’s independent public accountants for the fiscal year ending December 31, 2012.

¨

¨

¨

¨

WITHHOLD AUTHORITY FOR ALL NOMINEES

¨

FOR ALL EXCEPT (See instructions below)

4.

To transact such other business as may properly come before the meeting or any adjournment thereof.

INSTRUCTIONS: Towithhold authority to vote for any individual nominee(s), mark “FOR ALL EXCEPT” and fill in the circle next to each nominee you wish to withhold, as shown here:  l

Your Board of Directors has approved and recommends that you vote “FOR” all of the proposals that are discussed in more detail in the attached proxy statement.

The Board of Directors has fixed the close of business on April 13, 2012, as the record date for the determination of stockholders entitled to notice of and to vote at the meeting or any adjournments of the meeting. Only stockholders of record at the close of business on the record date are entitled to notice of and to vote at the meeting.

PLEASE MARK, SIGN DATE AND RETURN USING THE ENCLOSED ENVELOPE.

To change the address on your account, please check the box at right and indicate your new address in the address space above. Please note that changes to the registered name(s) on the account may not be submitted via this method.

¨

 

Signature of Stockholder

Date:

Signature of Stockholder

Date:

 

Note: n		Please sign exactly as your name or names appear on this Proxy. When shares are held jointly, each holder should sign. When signing as executor, administrator, attorney, trustee or guardian, please give full title as such. If the signer is a corporation, please sign full corporate name by duly authorized officer, giving full title as such. If signer is a partnership, please sign in partnership name by authorized person.		n

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ANNUAL MEETING OF STOCKHOLDERS OF

GULFMARK OFFSHORE, INC.

June 7, 2012

Important Notice Regarding the Availability of Proxy Materials for the

Stockholders Meeting of GulfMark Offshore, Inc. to Be Held on June 7, 2012.

The Proxy Statement dated April 27, 2012, Form of Proxy, and

the GulfMark Offshore, Inc. 2011 Annual Report to Stockholders for the year ended December 31, 2011

are available at http://www.proxydocs.com/GLF

Please sign, date and mail

your proxy card in the

envelope provided as soon

as possible.

  Please detach along perforated line and mail in the envelope provided.  

 

THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” THE ELECTION OF DIRECTORS AND “FOR” PROPOSAL 2 AND 3.   PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HERE  x

FOR

AGAINST

ABSTAIN

1.    To elect eight (8) directors.

2.

To vote on a proposal to approve, by a stockholder non-binding advisory vote, the compensation paid by us to our named executive officers, commonly referred to as a “Say-on-Pay” proposal.

¨

¨

¨

NOMINEES:

¨

FOR ALL NOMINEES

O     Peter I. Bijur O     David J. Butters O     Brian R. Ford O     Louis S. Gimbel, 3rd O     Sheldon S. Gordon O     Robert B. Millard O     Rex C. Ross O     Bruce A. Streeter

3.

To vote on a proposal to ratify the selection of KPMG LLP as the Company’s independent public accountants for the fiscal year ending December 31, 2012.

¨

¨

¨

¨

WITHHOLD AUTHORITY FOR ALL NOMINEES

4.

To transact such other business as may properly come before the meeting or any adjournment thereof.

¨

FOR ALL EXCEPT (See instructions below)

Your Board of Directors has approved and recommends that you vote “FOR” all of the proposals that are discussed in more detail in the attached proxy statement.

INSTRUCTIONS: To withholdauthority to vote for any individual nominee(s), mark “FOR ALL EXCEPT” and fill in the circle next to each nominee you wish to withhold, as shown here:  l

The Board of Directors has fixed the close of business on April 13, 2012, as the record date for the determination of stockholders entitled to notice of and to vote at the meeting or any adjournments of the meeting. Only stockholders of record at the close of business on the record date are entitled to notice of and to vote at the meeting.   PLEASE MARK, SIGN DATE AND RETURN USING THE ENCLOSED ENVELOPE.

To change the address on your account, please check the box at right and indicate your new address in the address space above. Please note that changes to the registered name(s) on the account may not be submitted via this method.

¨

 

Signature of Stockholder

Date:

Signature of Stockholder

Date:

 

Note:		Please sign exactly as your name or names appear on this Proxy. When shares are held jointly, each holder should sign. When signing as executor, administrator, attorney, trustee or guardian, please give full title as such. If the signer is a corporation, please sign full corporate name by duly authorized officer, giving full title as such. If signer is a partnership, please sign in partnership name by authorized person.

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GULFMARK OFFSHORE, INC.

ANNUAL MEETING OF STOCKHOLDERS

June 7, 2012

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

The undersigned stockholder of GulfMark Offshore, Inc. (“GulfMark”) hereby appoints Quintin V. Kneen and Richard M. Safier, or either of them, as proxies, each with power to act without the other and with full power of substitution, for the undersigned to vote the number of shares of Class A Common Stock of GulfMark that the undersigned would be entitled to vote if personally present at the Annual Meeting of Stockholders of GulfMark to be held in the Tribeca Room, The Peninsula Hotel, 700 5th Avenue at 55th Street, New York, New York 10019, on Thursday, June 7, 2012 at 8:00 A.M., eastern daylight time, and at any adjournment or postponement thereof, on the following matters that are more particularly described in the Proxy Statement dated April 27, 2012:

(Continued and to be signed on the reverse side)