SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
BARNWELL INDUSTRIES, INC.
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(Name of registrant as specified in its charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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<PAGE>
BARNWELL INDUSTRIES, INC.
-------------------
Notice of Annual Meeting of Stockholders
-------------------
To the Stockholders of BARNWELL INDUSTRIES, INC.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of
BARNWELL INDUSTRIES, INC., a Delaware corporation, will be held on March 5,
2001, at 9:30 a.m., Central Standard Time, at the Sheraton Shreveport Hotel,
1419 East 70th Street, Shreveport, Louisiana, for the purpose of considering and
acting upon:
(1) The election of a Board of Directors to serve until the next
Annual Meeting of Stockholders and until their successors shall have been
elected and qualified; and
(2) Any and all other business which may properly come before the
meeting or any adjournment thereof.
Only stockholders of record at the close of business on January 8, 2001,
are entitled to notice of and to vote at this meeting or any adjournment
thereof. The Company's Annual Report to Stockholders for the fiscal year ended
September 30, 2000, which includes consolidated financial statements, is
enclosed herewith.
We will be pleased to have you attend the meeting. However, if you are
unable to do so, please sign and return the enclosed Proxy in the enclosed
addressed envelope.
By Order of the Board of Directors,
/s/ Alexander C. Kinzler
------------------------
ALEXANDER C. KINZLER
Secretary
Dated: January 18, 2001
2
<PAGE>
BARNWELL INDUSTRIES, INC.
1100 ALAKEA STREET, SUITE 2900
HONOLULU, HAWAII 96813
PROXY STATEMENT
SOLICITATION AND REVOCATION OF PROXIES
The following information is furnished in connection with the Annual
Meeting of Stockholders of Barnwell Industries, Inc., a Delaware corporation
(the "Company") to be held on March 5, 2001 at 9:30 a.m. Central Standard Time,
at the Sheraton Shreveport Hotel, 1419 East 70th Street, Shreveport, Louisiana.
The accompanying Proxy is solicited by the Board of Directors of the
Company, and the Company will bear the cost of such solicitation. Solicitation
of proxies will be primarily by mail. Proxies may also be solicited by regular
employees of the Company by telephone at a nominal cost. Brokerage houses and
other custodians, nominees and fiduciaries will be requested to forward
soliciting material to the beneficial owners of Common Stock (as defined below)
and will be reimbursed for their expenses. All properly executed proxies will be
voted as instructed.
Stockholders who execute proxies may revoke them by delivering
subsequently dated proxies or by giving written notice of revocation to the
Secretary of the Company at any time before such proxies are voted. No proxy
will be voted if the stockholder attends the meeting and elects to vote in
person.
This Proxy Statement and the accompanying Form of Proxy are first being
sent to stockholders on or about January 18, 2001.
VOTING AT THE MEETING
Only stockholders of record at the close of business on January 8, 2001,
(the "Record Date") will be entitled to vote at the annual meeting and any
adjournment thereof. As of the Record Date, 1,310,952 shares of common stock,
par value $0.50, of the Company (the "Common Stock") were issued and
outstanding. Each share of Common Stock outstanding as of the Record Date is
entitled to one vote on any proposal presented at the meeting. With respect to
abstentions, the shares will be considered present at the meeting for a
particular proposal, but since they are not affirmative votes for the proposal,
they will have the same effect as a vote withheld on the election of directors
or a vote against such other proposal, as the case may be. Brokers and nominees
may be precluded from exercising their voting discretion with respect to certain
matters to be acted upon and, thus, in the absence of specific instructions from
the beneficial owner of the shares, will not be empowered to vote the shares on
such matters and, therefore, will not be counted in determining the number of
shares necessary for approval. Shares represented by such broker nonvotes will,
however, be counted for purposes of determining whether there is a quorum.
ELECTION OF DIRECTORS
At the meeting all nine directors of the Company are proposed to be
elected, each elected director to hold office until the next annual meeting and
until his successor is elected and qualified. The persons named as proxies in
the enclosed Proxy are executive officers of the Company and, unless contrary
instructions are given, they will vote the shares represented by the Proxy for
the election to the Board of Directors of the persons named below. The election
of directors will require a plurality of the votes cast at the meeting. The
Board of Directors has no reason to believe that any of the nominees for the
office of Director will be unable to serve; however, in the event any of the
nominees should withdraw or otherwise become unavailable for reasons not
presently known, the persons named as proxies will vote for other persons in
place of such nominees.
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<PAGE>
<TABLE>
<CAPTION>
DIRECTORS AND NOMINEES TO THE BOARD OF DIRECTORS
The following table sets forth as to the directors and nominees for
election: (1) such person's name; (2) the year in which such person was first
elected a director of the Company; (3) such person's age; (4) all positions and
offices with the Company held by such person; (5) the business experience of
such person during the past five years; and (6) certain other directorships, if
any, held by such person.
Director All other Present Positions with
Name Since Age the Company and Principal Occupations
---------------------------- -------- ----- --------------------------------------------------
<S> <C> <C> <C>
Morton H. Kinzler 1956 75 Chairman of the Board of the Company since 1980,
President and Chief Executive Officer since
1971. Mr. Kinzler is the father of Alexander C.
Kinzler, Executive Vice President, Secretary and
Director of the Company.
Alan D. Hunter 1977 63 Partner, Gowling LaFleur Henderson LLP, Calgary,
Alberta (attorneys) since July 1, 2000; Partner,
Gowling, Strathy & Henderson, Calgary, Alberta
(attorneys) from January 1, 2000 to June 30,
2000; Gowling, Strathy & Henderson merged with
LaFleur Brown effective July 1, 2000; Partner,
Code Hunter, Calgary, Alberta (attorneys) for
the prior 5 years; Code Hunter merged into
Gowling Strathy & Henderson on January 1, 2000.
Erik Hazelhoff-Roelfzema 1977 83 Investor
Daniel Jacobson 1981 72 Vice Chairman and Director, Siebert Financial
Corp. (securities brokerage) since May 3, 1999;
Partner, Richard A. Eisner & Company, LLP, New
York, New York (Accountants and Consultants),
from June 1, 1994 to May 2, 1999.
Martin Anderson 1985 77 Partner, Goodsill Anderson Quinn & Stifel,
Honolulu, Hawaii (attorneys); Trustee, Hawaii
Pacific University; and Director, Bishop Street
Funds.
Glenn Yago, Ph.D. 1990 50 Director of Capital Studies/Senior Economist,
Milken Institute, since August, 1996; Professor,
Baruch College - City University of New York
Graduate School between September, 1994 and
September, 1996; Director, American Passage
Media Corporation (targeted media and
publishing) and Media Passage Holdings, Inc.
(diversified media).
Murray C. Gardner, Ph.D. 1996 68 Independent consultant and investor
Alexander C. Kinzler 1999 42 Executive Vice President of the Company since
December 1997 and Secretary since 1986.
Employed by the Company since 1984. Mr. Kinzler
is the son of Morton H. Kinzler, President,
Chief Executive Officer and Chairman of the
Board of Directors of the Company.
Terry Johnston 2000 59 Investor. Mr. Johnston is the president of the
managing general partner of Cambridge Hawaii
Limited Partnership ("CHLP"). CHLP is a 49.9%
partner in the Company's Kaupulehu Developments
partnership.
</TABLE>
4
<PAGE>
The Board of Directors has a standing Compensation Committee, a standing
Audit Committee, and a standing Executive Committee. It has no standing
nominating committee. The members of the Compensation Committee are Mr. Hunter,
Chairman, and Messrs. Jacobson, Anderson, Gardner, Johnston and Morton Kinzler,
with Mr. Morton Kinzler being a non-voting member. The Compensation Committee
(i) determines the annual compensation of the Company's senior officers; (ii)
recommends, if appropriate, new employee benefit plans to the Board of
Directors; (iii) administers all employee benefit plans and (iv) makes
determinations in connection therewith as may be necessary or advisable. During
the fiscal year ended September 30, 2000, the Compensation Committee held one
meeting.
The members of the Audit Committee are Mr. Jacobson, Chairman, and
Messrs. Yago, Gardner and Anderson. All of the members of the Audit Committee
are independent (as independence is defined in Section 121 (A) of the American
Stock Exchange listing standards). The Board of Directors has adopted a written
charter for the Audit Committee to set forth its responsibilities. A copy of the
charter is attached as Exhibit A to this Proxy Statement. The Audit Committee
recommends the independent accountants appointed by the Board of Directors to
audit the consolidated financial statements of the Company, and reviews with
such accountants the scope of their audit and report thereon, including any
questions and recommendations that may arise relating to such audit and report
or the Company's internal accounting and auditing procedures. It also reviews
periodically the performance of the Company's accounting and financial
personnel. During the fiscal year ended September 30, 2000, the Audit Committee
held two meetings.
Report of the Audit Committee
The Audit Committee has reviewed and discussed the audited financial
statements with management, and the Audit Committee has discussed with KPMG LLP,
the independent auditors, the matters required to be discussed by Statement on
Auditing Standards No. 61 (Codification of Statements on Auditing Standards, AU
Section 380), as such may be modified or supplemented. The Audit Committee has
also received the written disclosures and the letter from KPMG LLP that are
required by Independence Standards Board Standard No. 1 (Independence Standards
Board Standard No. 1, Independence Discussions with Audit Committee) as may be
modified or supplemented, and has discussed with KPMG LLP the independent
auditor's independence. Based upon its discussions with management and with KPMG
LLP, the Audit Committee has recommended to the Board of Directors that the
audited financial statements be included in the Company's Annual Report on form
10-KSB for the fiscal year ended September 30, 2000.
Audit Committee
Daniel Jacobson, Chairman
Glenn Yago
Murray C. Gardner
Martin Anderson
The members of the Executive Committee are Mr. Morton Kinzler, Chairman,
and Messrs. Anderson, Hazelhoff-Roelfzema and Gardner. The Executive Committee
is empowered to exercise all of the authority of the Board of Directors, except
for certain items enumerated in the Company's By-Laws. During the fiscal year
ended September 30, 2000, the Executive Committee held no meetings.
The Board of Directors held three meetings during the fiscal year ended
September 30, 2000. Other than Mr. Yago, who attended one Board Meeting and one
Audit Committee Meeting, all directors attended all meetings of the Board of
Directors and of the Committees of the Board on which each of them served.
5
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<TABLE>
<CAPTION>
EXECUTIVE OFFICERS OF THE COMPANY
The following table sets forth the names and ages of all executive
officers of the Company, their positions and offices with the Company and the
period during which each has served.
Name Age Position with the Company
---- --- -------------------------
<S> <C> <C>
Morton H. Kinzler 75 Chairman of the Board since 1980 and President
and Chief Executive Officer since 1971.
Russell M. Gifford 46 Executive Vice President since December 1997,
Treasurer since November 1986 and Chief
Financial Officer since August 1985. Served as
Vice President of the Company from March 1985 to
December 1997.
Alexander C. Kinzler 42 Executive Vice President since December 1997 and
Secretary since November 1986. Served as Vice
President of the Company from November 1986 to
December 1997. Director of the Company since
December 1999.
Warren D. Steckley 44 Vice President - Canadian Operations since
December 1998. President of Barnwell of Canada,
Limited, a wholly owned subsidiary of the
Company, since December 1998. Employed by
Barnwell of Canada, Limited since June 1998.
From 1994 to May 1998, Mr. Steckley was an
independent consultant in Calgary, Alberta
providing technical and financial services to
emerging oil and gas companies.
</TABLE>
<TABLE>
<CAPTION>
EXECUTIVE COMPENSATION
Summary Compensation Table
The following summary compensation table sets forth the annual
compensation paid or accrued by the Company to the Chief Executive Officer and
to executive officers whose annual compensation exceeded $100,000 for the fiscal
year ended September 30, 2000 (collectively the "Named Executive Officers") for
services during the fiscal years ended September 30, 2000, 1999, and 1998:
Long Term
Compensation
----------------
Annual Compensation Awards
-------------------------------------- ----------------
Other
Annual Securities
Name and Compen- Underlying
Principal Position Year Salary Bonus sation Options
-------------------------------- ------ ----------- ---------- ---------- ----------------
<S> <C> <C> <C> <C> <C>
Morton H. Kinzler 2000 $ 300,000 $ 150,000 $ 12,497
Chairman of the Board, 1999 300,000 100,000 12,497
President and Chief 1998 300,000 - 12,497
Executive Officer
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
Long Term
Compensation
----------------
Annual Compensation Awards
-------------------------------------- ----------------
Other
Annual Securities
Name and Compen- Underlying
Principal Position Year Salary Bonus sation Options
-------------------------------- ------ ----------- ---------- ---------- ----------------
<S> <C> <C> <C> <C> <C>
Russell M. Gifford 2000 190,000 125,000 25,000 (1)
Executive Vice President, 1999 190,000 -
Chief Financial Officer and 1998 186,875 -
Treasurer
Alexander C. Kinzler 2000 196,875 150,000 25,000 (1)
Executive Vice President, 1999 187,500 75,000
Secretary and Director 1998 184,375 -
Warren D. Steckley 2000 101,865 (2) 50,933
Vice President - Canadian 1999 99,870 26,632
Operations 1998 34,520 20,712 30,000
</TABLE>
Directors who are not officers of the Company receive an annual fee of
$10,000 and are reimbursed for expenses incurred with respect to meeting
attendance. The Chairman of the Compensation Committee receives an additional
$7,500 annual fee. The Chairman of the Audit Committee receives an additional
$12,500 annual fee. The members of the Executive and Compensation Committees,
other than the Chairmen, receive an additional $1,250 annual fee. The members of
the Audit Committee, other than the Chairman, receive an additional $3,750
annual fee. In lieu of payment of such fees to Mr. Hazelhoff-Roelfzema, the
Company reimburses him for certain expenses incurred in connection with his
service as a director.
<TABLE>
<CAPTION>
Option/SAR Grants in Last Fiscal Year
The following table sets forth information related to stock option and
stock appreciation right ("SAR") grants to the Named Executive Officers during
the fiscal year ended September 30, 2000.
Individual Grants
---------------------------------------------------------------------------------------------------
Number of % of Total
Securities Options/SARs
Underlying Granted to
Options/SARs Employees in Exercise or Base Date of
Granted (#) Fiscal Year (%) Price ($/Share) Expiration
-------------- ---------------- ----------------- ---------------
<S> <C> <C> <C> <C>
Morton H. Kinzler 0/0 0/0
Russell M. Gifford 25,000 (3)/0 26%/0 $ 11.875/Share 12/05/2009
Alexander C. Kinzler 25,000 (3)/0 26%/0 $ 13.063/Share 12/05/2004
Warren D. Steckley 0/0 0/0
--------------------------------
<FN>
1 See "Option/SAR Grants in Last Fiscal Year".
2 All amounts shown for Mr. Steckley represent the average U.S. dollar equivalent
during each fiscal year of payments made to him in Canadian dollars.
3 6,250 of such options become exercisable annually on December 5, 2000, 2001, 2002 and 2003,
respectively.
</FN>
</TABLE>
7
<PAGE>
Aggregated Option Exercises in Last Fiscal Year
and Fiscal Year-End Option Values
The following table sets forth information related to the number of
shares of Common Stock acquired during the fiscal year ended September 30, 2000
by the Named Executive Officers pursuant to the exercise of stock options, the
value realized by the Named Executive Officers on exercise of such stock options
and the number and value of unexercised stock options held by the Named
Executive Officers at the end of the fiscal year ended September 30, 2000:
<TABLE>
<CAPTION>
Number of Value of
Securities Underlying Unexercised
Unexercised In-the-Money
Options at Options at
Shares September 30, 2000 September 30, 2000 ($)
Acquired on Value ------------------ ----------------------
Exercise (#) Realized($) Exercisable/Unexercisable Exercisable/Unexercisable
------------ ----------- -------------------------- --------------------------
<S> <C> <C> <C> <C>
Morton H. Kinzler 0 $0 0/0 $0/$0
Russell M. Gifford 0 0 0/25,000 0/143,750
Alexander C. Kinzler 0 0 20,000/25,000 0/114,050
Warren D. Steckley 0 0 12,000/18,000 24,000/36,000
</TABLE>
The Company has an agreement with Mr. Warren D. Steckley with respect to
his entry into employment with Barnwell of Canada, Limited, a wholly owned
subsidiary of the Company ("BOC"), whereby the Company agreed to provide him an
annual salary of $150,000 Canadian dollars and a minimum bonus of $30,000
Canadian dollars for his first full fiscal year of employment. This agreement
does not provide any term of employment. Also pursuant to this agreement, on
June 1, 1998, Mr. Steckley was granted 30,000 non-qualified options to purchase
the Company's common stock at $15.625 per share. Mr. Steckley was also granted
30,000 incentive units on June 1, 1998, pursuant to an incentive plan adopted by
the Board of Directors of BOC in 1998, which was created to give an incentive to
key employees of BOC to increase the value of BOC's oil and gas reserves. The
value of the units under such plan directly relates to BOC's net income and to
changes in the value of BOC's oil and gas reserves since 1998, with adjustments
for changes in commodities prices and subject to other terms and conditions.
Such adjusted reserve value is then divided by the number of shares of the
Company's outstanding common stock to determine the value of each unit. These
units become exercisable over 4 years from the date of grant and expire 10 years
from the date of grant.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company has an agreement with Mr. Terry Johnston, a director of the
Company, whereby Barnwell Hawaiian Properties, Inc., a wholly owned subsidiary
of the Company ("BHP"), is to pay him certain fees upon the receipt by Kaupulehu
Developments, the Company's majority-owned real estate partnership ("KD"), of
cash consideration, in consideration of substantial time Mr. Johnston has
devoted to KD over the past 16 years. In January 2000, BHP paid a fee of $60,000
to a company controlled by Mr. Johnston in connection with KD's receipt of
consideration for the exercise of certain residential parcel options.
In August 1998, KD arranged a credit facility to finance KD's pursuit of
development approvals. KD entered into an agreement with Mr. Terry Johnston
whereby he assisted KD in arranging such facility by guaranteeing principal
repayments and collateralizing such facility with $500,000 in cash. In return,
KD agreed to pay Mr. Johnston a fee calculated as the difference between KD's
interest cost and 400 basis points above the prime rate on borrowings under such
credit facility, to be paid at the time the principal borrowings were repaid and
the credit facility was terminated. In January 2000, in connection with KD's
receipt of consideration for the exercise of certain residential parcel options,
KD repaid such borrowings under the facility, thereby terminating it, and paid a
fee of $30,304 to a company controlled by Mr. Johnston, calculated as described
in this paragraph.
8
<PAGE>
In June, 1995, the Company issued $2,000,000 of convertible notes due
July 1, 2003 for an aggregate price of $2,000,000. $400,000 of such notes were
purchased by Mr. Morton H. Kinzler, President, Chief Executive Officer and
Chairman of the Board of Directors of the Company, $200,000 were purchased by
Mr. Martin Anderson, a director of the Company, $200,000 were purchased by Dr.
Joseph E. Magaro, a 16.4% shareholder of the Company, $100,000 were purchased by
Dr. R. David Sudarsky, a 9.4% shareholder of the Company, and $1,000,000 were
purchased by Ingalls and Snyder, a 5.0% shareholder of the Company. See
"Security Ownership of Certain Beneficial Owners and Management", below. The
notes are payable in 20 consecutive equal quarterly installments beginning in
October 1998. Interest, which is adjusted quarterly to the greater of 10% per
annum or 1% over the prime rate of interest, is payable quarterly. Throughout
fiscal year 2000, the notes bore interest at the rate of 10% per annum. The
notes are convertible into shares of Common Stock at a price of $20.00 per
share, subject to adjustment for certain events including a stock split of, or
stock dividend on, the Common Stock. The notes are redeemable, at the option of
the Company, at premiums declining 1% annually, beginning in 1997, from 5% to 0%
of the principal amount of the notes.
The Company is contingently liable for a demand loan made by a Canadian
bank in fiscal 1991 and renewed annually to Dr. Joseph E. Magaro, a 16.4%
shareholder of the Company, in the amount of $100,000 in connection with the
development of certain oil and gas properties in Canada in which he
participated. The loan is secured by Dr. Magaro's interest in those oil and gas
properties, the value of which, in the Company's opinion, far exceeds the amount
of the loan. The annual rate of interest applicable to this loan is set by the
Royal Bank of Canada. As of September 30, 2000, such rate of interest was 7.50%.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information as of December 1, 2000, with
respect to the beneficial ownership of the Common Stock, the sole voting
security of the Company, by (i) each person known to the Company who
beneficially owns more than 5% of the Common Stock, (ii) each director and
nominee of the Company, (iii) the Named Executive Officers and (iv) all
directors and executive officers of the Company as a group.
<TABLE>
<CAPTION>
Amount and Nature of Percent
Name and Address of Beneficial Owner Beneficial Ownership (1) of Class
------------------------------------------------- ------------------------ ---------
<S> <C> <C> <C>
Joseph E. Magaro 401 Riversville Road 215,510 (2) 16.4%
Greenwich, Connecticut
R. David Sudarsky 3050 North Ocean Boulevard 123,600 (3) 9.4%
Ft. Lauderdale, Florida
-------------------------------
<FN>
(1) A person is deemed to be the beneficial owner of securities that such
person can acquire as of and within the 60 days following the date of this
table upon the exercise of options or rights of conversion. Each beneficial
owner's percentage of ownership is determined by assuming that options or
conversion rights that are held by such person (but not those held by any
other person) and which are exercisable as of and within 60 days following
the date of this table have been exercised. For purposes of the footnotes
that follow, "currently exercisable" means options that are exercisable as
of and within 60 days following the date of this table and "currently
convertible" means conversion rights that are exercisable as of and within
60 days following the date of this table. Except as indicated in the
footnotes that follow, shares listed in the table are held with sole voting
and investment power.
(2) Includes a note in the principal amount of $100,000 that is currently
convertible into 5,000 shares of Common Stock at a conversion price of
$20.00 per share.
(3) Includes a note in the principal amount of $50,000 that is currently
convertible into 2,500 shares of Common Stock at a conversion price of
$20.00 per share.
</FN>
</TABLE>
9
<PAGE>
<TABLE>
<CAPTION>
Amount and Nature of Percent
Name and Address of Beneficial Owner Beneficial Ownership** of Class
------------------------------------------------------------------ ------------------------ ---------
<S> <C> <C> <C>
Morton H. Kinzler 1100 Alakea Street, Suite 2900 236,960 (4) 17.9%
Honolulu, Hawaii
Alan D. Hunter 44 Medford Place, S.W. 400 *
Calgary, Alberta, Canada
Erik Hazelhoff-Roelfzema 1120, 639 Fifth Avenue S.W. 700 *
Calgary, Alberta, Canada
Daniel Jacobson 885 Third Avenue 5,000 *
New York, New York
Martin Anderson 1099 Alakea Street, Suite 1800 91,945 (5) 7.0%
Honolulu, Hawaii
Glenn Yago, Ph.D. 1250 Fourth Street, 2nd Floor 300 *
Santa Monica, California
Murray C. Gardner, Ph.D. P. O. Box 1657 2,200 *
Kamuela, Hawaii
Russell M. Gifford 1100 Alakea Street, Suite 2900 9,050 (6) *
Honolulu, Hawaii
Alexander C. Kinzler 671 Puuikena Drive 43,920 (7) 3.3%
Honolulu, Hawaii
Warren D. Steckley 216 Sunmount Bay SE 12,000 (8) *
Calgary, Alberta, Canada
Terry Johnston 201-5325 Cordova Bay Road 1,000 *
Victoria, British Columbia, Canada
Ingalls & Snyder 61 Broadway 66,400 (9) 5.0%
New York, New York
All directors and executive officers as a group (11 persons) 403,475 (10) 29.4%
------------------------------------
<FN>
(4) Includes (i) a note in the principal amount of $200,000 that is currently
convertible into 10,000 shares of Common Stock at a conversion price of
$20.00 per share, and (ii) 11,000 shares of Common Stock held by an estate
of which Mr. Kinzler is a co-executor, as to which shares Mr. Kinzler may
be deemed to share voting and investment power. Mr. Kinzler disclaims
beneficial ownership of the shares held by such estate.
(5) Includes a note in the principal amount of $100,000 that is currently
convertible into 5,000 shares of Common Stock at a conversion price of
$20.00 per share.
(6) Includes currently exercisable option to acquire 6,250 shares of Common
Stock.
(7) Includes currently exercisable options to acquire 26,250 shares of Common
Stock.
(8) Includes currently exercisable options to acquire 12,000 shares of Common
Stock.
(9) Includes a note in the principal amount of $500,000 that is currently
convertible into 25,000 shares of Common Stock at a conversion price of
$20.00 per share.
(10) Includes currently exercisable options held by executive officers of the
Company to acquire 44,500 shares of the Common Stock, and notes in the
aggregate principal amount of $300,000 held by directors of the Company
currently convertible into 15,000 shares of Common Stock at a conversion
price of $20.00 per share.
* Represents less than 1% of the outstanding shares of Common Stock of the
Company.
** See footnote 1 on previous page.
</FN>
</TABLE>
10
<PAGE>
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's officers and directors, and persons who own more than 10% of a
registered class of the Company's equity securities, to file reports of
beneficial ownership on Forms 3, 4, and 5 with the Securities and Exchange
Commission and any national securities exchange on which such equity securities
are registered. Based solely on the Company's review of the copies of such forms
it has received and written representations from certain reporting persons that
they were not required to file reports on Form 5 during the most recently
completed fiscal year or prior years, the Company believes that all of its
officers, directors and greater than 10% beneficial owners complied with all
Section 16(a) filing requirements applicable to them during the Company's most
recently completed fiscal year.
SELECTION OF INDEPENDENT ACCOUNTANTS
The Board of Directors of the Company has appointed KPMG LLP as the firm
of independent public accountants to audit the accounts of the Company for the
year ending September 30, 2001. This firm expects to have a representative
available by telephone at the meeting who will have an opportunity to make a
statement if he or she desires to do so and will be available to respond to
appropriate questions.
STOCKHOLDER PROPOSALS
Any proposal submitted by a stockholder of the Company for action at the
next Annual Meeting of Stockholders will not be included in the proxy material
to be mailed to the Company's stockholders in connection with such meeting
unless such proposal is received at the principal office of the Company no later
than September 25, 2001.
GENERAL
No business other than those set forth in Item (1) and Item (2) of the
Notice of Annual Meeting of Stockholders is expected to come before the meeting,
but should any other matters requiring a vote of stockholders properly arise,
including a question of adjourning the meeting, the persons named in the
accompanying Proxy will vote thereon according to their best judgment in the
best interests of the Company.
Insofar as any of the information in this Proxy Statement may rest
peculiarly within the knowledge of persons other than the Company, the Company
has relied upon information furnished by such persons.
By Order of the Board of Directors,
/s/ Alexander C. Kinzler
------------------------
ALEXANDER C. KINZLER
Secretary
Dated: January 18, 2001
Stockholders may obtain a copy, without charge, of the Company's Annual
Report on Form 10-KSB, as filed with the Securities and Exchange Commission, by
writing to Alexander C. Kinzler, Barnwell Industries, Inc., 1100 Alakea Street,
Suite 2900, Honolulu, Hawaii 96813
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<PAGE>
EXHIBIT A
BARNWELL INDUSTRIES, INC.
AUDIT COMMITTEE CHARTER
The Audit Committee is appointed by the Board to assist the Board in monitoring
(1) the integrity of the financial statements of the Company, (2) the compliance
by the Company with legal and regulatory requirements and (3) the independence
and performance of the Company's independent auditors.
There shall be at least two members of the Audit Committee, the majority of whom
shall meet the independence requirements of the American Stock Exchange.
The Audit Committee shall have the authority to retain special legal, accounting
or other consultants to advise the Committee. The Audit Committee may request
any officer or employee of the Company or the Company's outside counsel or
independent auditor to attend a meeting of the Committee or to meet with any
members of, or consultants to, the Committee.
The Audit Committee shall make regular reports to the Board. Meetings of the
Audit Committee may be either in person or by telephonic conference.
The Audit Committee shall:
1. Review and reassess the adequacy of this Charter annually and submit it to
the Board for approval.
2. Review the annual audited financial statements with management, including
major issues regarding accounting and auditing principles and practices as
well as the adequacy of internal controls that could significantly affect
the Company's financial statements.
3. Review an analysis prepared by management and the independent auditor of
significant financial reporting issues and judgments made in connection
with the preparation of the Company's financial statements.
4. Review with management and the independent auditor the Company's quarterly
financial statements prior to the release of quarterly earnings. The
Chairman of the Committee may represent the entire Audit Committee for
purposes of this review, which may be done in person or by telephonic
conference.
5. Meet periodically with management, in person or by telephone, to review the
Company's major financial risk exposures and the steps management has taken
to monitor and control such exposures.
6. Review major changes to the Company's auditing and accounting principles
and practices as suggested by the independent auditor, internal auditors or
management.
7. Recommend to the Board the appointment of the independent auditor, which
firm is ultimately accountable to the Audit Committee and the Board.
8. Approve the fees to be paid to the independent auditor.
9. Receive periodic reports from the independent auditor regarding the
auditor's independence, discuss such reports with the auditor, and if so
determined by the Audit Committee, recommend that the Board take
appropriate action to insure the independence of the auditor.
10. Evaluate the performance of the independent auditor and, if so determined
by the Audit Committee, recommend that the Board replace the independent
auditor.
11. Meet with the independent auditor prior to the audit to review the
planning and staffing of the audit.
12
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12. Obtain from the independent auditor assurance that Section 10 A of the
Private Securities Litigation Reform Act of 1995 has not been
implicated.
13. Discuss with the independent auditor the matters required to be discussed
by Statement on Auditing Standards No. 61, as modified or amended, relating
to the conduct of the audit.
14. Review with the independent auditor any problems or difficulties the
auditor may have encountered and any management letter provided by the
auditor and the Company's response to that letter. Such review should
include:
Any difficulties encountered in the course of the audit work,
including any restrictions on the scope of activities or access to
required information.
Any changes required in the planned scope of the audit.
15. Prepare the report required by the rules of the Securities and Exchange
Commission to be included in the Company's annual proxy statement.
16. Advise the Board with respect to the Company's policies and procedures
regarding compliance with applicable laws and regulations.
17. Review with the Company's General Counsel legal matters that may have a
material impact on the financial statements, the Company's compliance
policies and any material reports or inquiries received from regulators or
governmental agencies.
18. Meet at least annually with the chief financial officer and the independent
auditor in separate executive sessions.
While the Audit Committee has the responsibilities and powers set forth in this
Charter, it is not the duty of the Audit Committee to plan or conduct audits or
to determine that the Company's financial statements are complete and accurate
and are in accordance with generally accepted accounting principles. This is the
responsibility of management and the independent auditor. Nor is it the duty of
the Audit Committee to conduct investigations, to resolve disagreements, if any,
between management and the independent auditor or to assure compliance with laws
and regulations.
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Appendix 1
----------
FRONT OF CARD
PROXY
BARNWELL INDUSTRIES, INC.
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS OF THE COMPANY
The undersigned stockholder of Barnwell Industries, Inc., a Delaware
corporation, hereby appoints Morton H. Kinzler and Alexander C. Kinzler, and
each of them, attorneys, agents and proxies of the undersigned, with full power
of substitution to each of them, to vote all the shares of Common Stock which
the undersigned may be entitled to vote at the Annual Meeting of Stockholders of
the Company to be held at the Sheraton Shreveport Hotel, 1419 East 70th Street,
Shreveport, Louisiana, on March 5, 2001, at 9:30 A.M., Central Standard time,
and at any adjournment of such meeting, with all powers which the undersigned
would possess if personally present:
(Continued and to be signed on reverse side)
-------------------------------------------------------------------------------
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BACK OF CARD
X Please mark your votes as in this example.
-----
1. The election of the 9 Directors
listed at right:
Nominees: Morton H. Kinzler
FOR all nominees WITHHOLD AUTHORITY Alan D. Hunter
listed at right to vote for all Erik Hazelhoff-Roelfzema
(except as marked nominees listed at Daniel Jacobson
to the contrary) right Martin Anderson
Glenn Yago
----- ----- Murray C. Gardner
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR Alexander C. Kinzler
ANY INDIVIDUAL NOMINEE, STRIKE A LINE THROUGH Terry Johnston
THAT NOMINEE'S NAME IN THE LIST AT RIGHT.)
2. Upon any and all other business which may come before the meeting or any
adjournment thereof.
The undersigned acknowledges receipt of the Notice of Annual Meeting of
Stockholders, Proxy Statement of the Company for the Annual Meeting and the
Company's Annual Report to Stockholders for the fiscal year ended September 30,
2000.
This Proxy, when properly executed, will be voted in accordance with the
specification made hereon. If not otherwise specified, this Proxy will be voted
FOR the election of Board of Directors as proposed herein.
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
SIGNATURE DATE SIGNATURE DATE
------------------ -------- ------------------ -------
IF HELD JOINTLY
(Signature(s) should agree with name on stock certificate as stenciled hereon.
Executors, administrators, trustees, etc., should so indicate when signing.)
