This excerpt taken from the TBSI DEF 14A filed Apr 29, 2008.
Equity incentive. The TBS International Limited 2005 Equity Incentive Plan (the 2005 Plan) was approved by the Companys shareholders and allows the Compensation Committee to grant share options, restricted shares, share units and other forms of equity incentives to employees, including the named executive officers. The Compensation Committee believes that a significant purpose of equity compensation awards is to retain employees since their willingness and desire to stay with the Company and perform at or above their abilities is enhanced by the future vesting of long-term equity compensation awards. The Company has used restricted shares and share units as its primary stock-based compensation vehicles.
During 2007, the Compensation Committee decided not to make new equity incentive awards to Messrs. Royce, McNelis and Blatte, as the Compensation Committee believes that these named executive officers currently have adequate Company share ownership and that any further share awards are not necessary for retention. This aspect of compensation will however be reviewed on an annual basis, and long-term share grants and other forms of equity incentives will continue to be considered as part our overall compensation package. In 2007, the Compensation Committee initially determined not to grant Mr. Lepere equity incentive awards because Mr. Lepere has 50,000 unvested restricted shares from a 100,000 restricted share grant awarded at the time of our initial public offering in June 2005, and these 50,000 shares will vest in equal installments in June 2008 and June 2009. However, as discussed above, the Compensation Committee subsequently reevaluated compensation practices for executive officers with similar levels of responsibility in the maritime industry and determined to award Mr. Lepere an additional 12,000 restricted shares in 2008, vesting in four equal annual installments beginning on March 1, 2009. The Compensation Committee granted Mr. Levin 15,000 share units in connection with his hiring in July 2007. One-third of these units vest upon the launch of the first vessel built for the Company by China Communications Construction Company Ltd./Nantong Yahua Shipbuilding Co., Ltd. (the Launch Date). The remaining share units will vest in two equal installments upon the first and second anniversaries of the Launch Date. This grant was designed to incentivize Mr. Levin in connection with his stewardship of the Companys shipbuilding operations.