SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
[Amendment No. _________]
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
PONTOTOC PRODUCTION, INC.
(Name of Registrant as Specified in Its Charter)
PONTOTOC PRODUCTION, INC.
(Name of Person(s) Filing Proxy Statement)
<PAGE>
PONTOTOC PRODUCTION, INC.
808 East Main
Ada, Oklahoma 74820
(580) 436-6100
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD SEPTEMBER 27, 2000
TO THE SHAREHOLDERS OF PONTOTOC PRODUCTION, INC.:
NOTICE HEREBY IS GIVEN that the Annual Meeting of Shareholders of
Pontotoc Production, Inc., a Nevada corporation (the "Company"), will be held
at the Company's headquarters at 808 East Main, Ada, Oklahoma 74820, on
Wednesday, September 27, 2000, at 3:00 p.m., Central Time, and at any and all
adjournments thereof, for the purpose of considering and acting upon the
following matters.
1. The election of six (6) Directors of the Company to serve until the
next Annual Meeting of Shareholders and until their successors have been duly
elected and qualified;
2. The ratification of the appointment of Grant Thornton LLP as the
Company's independent auditors; and
3. The transaction of such other business as may properly come before
the meeting or any adjournment thereof.
Only holders of the $.0001 par value Common Stock of the Company of
record at the close of business on August 23, 2000, will be entitled to notice
of and to vote at the Meeting or at any adjournment or adjournments thereof.
The proxies are being solicited by the Board of Directors of the Company.
All shareholders, whether or not they expect to attend the Annual Meeting
of Shareholders in person, are urged to sign and date the enclosed Proxy and
return it promptly in the enclosed postage-paid envelope which requires no
additional postage if mailed in the United States. The giving of a proxy will
not affect your right to vote in person if you attend the Meeting.
BY ORDER OF THE BOARD OF DIRECTORS
JAMES "ROBBY" ROBSON, JR., PRESIDENT
Ada, Oklahoma
August 23, 2000
<PAGE>
PONTOTOC PRODUCTION, INC.
808 East Main
Ada, Oklahoma 74820
(580) 436-6100
------------------------------
PROXY STATEMENT
------------------------------
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD SEPTEMBER 27, 2000
GENERAL INFORMATION
The enclosed Proxy is solicited by and on behalf of the Board of
Directors of Pontotoc Production, Inc., a Nevada corporation (the "Company"),
for use at the Company's Annual Meeting of Shareholders to be held at the
Company's headquarters at 808 East Main, Ada, Oklahoma 74820, on Wednesday,
September 27, 2000, at 3:00 p.m., Central Time, and at any and all
adjournments thereof. It is anticipated that this Proxy Statement and the
accompanying Proxy will be mailed to the Company's shareholders on or about
August 30, 2000.
Any person signing and returning the enclosed Proxy may revoke it at any
time before it is voted by giving written notice of such revocation to the
Company, or by voting in person at the Meeting. The expense of soliciting
proxies, including the cost of preparing, assembling and mailing this proxy
material to shareholders, will be borne by the Company. It is anticipated
that solicitations of proxies for the Meeting will be made only by use of the
mails; however, the Company may use the services of its Directors, Officers
and employees to solicit proxies personally or by telephone, without
additional salary or compensation to them. Brokerage houses, custodians,
nominees and fiduciaries will be requested to forward the proxy soliciting
materials to the beneficial owners of the Company's shares held of record by
such persons, and the Company will reimburse such persons for their reasonable
out-of-pocket expenses incurred by them in that connection.
All shares represented by valid proxies will be voted in accordance
therewith at the Meeting.
The Company's Annual Report for the fiscal year ended March 31, 2000, is
being simultaneously mailed to the Company's shareholders, but does not
constitute part of these proxy soliciting materials.
SHARES OUTSTANDING AND VOTING RIGHTS
All voting rights are vested exclusively in the holders of the Company's
$.0001 par value Common Stock, with each share entitled to one vote. Only
shareholders of record at the close of business on August 23, 2000, are
entitled to notice of and to vote at the Meeting or any adjournment thereof.
On August 23, 2000, the Company had 5,205,695 shares of its $.0001 par value
Common Stock outstanding, each share of which is entitled to one vote on all
matters to be voted upon at the Meeting, including the election of Directors.
Cumulative voting in the election of Directors is not permitted.
A majority of the Company's outstanding common stock represented in
person or by proxy shall constitute a quorum at the Meeting.
<PAGE>
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth the number and percentage of shares of the
Company's $.0001 par value common stock owned beneficially, as of August 23,
2000, by any person, who is known to the Company to be the beneficial owner of
5% or more of such common stock, and, in addition, by each Director and
Executive Officer of the Company, and by all Directors and Executive Officers
of the Company as a group. Information as to beneficial ownership is based
upon statements furnished to the Company by such persons.
NAME AND ADDRESS OF AMOUNT AND NATURE OF PERCENT
BENEFICIAL OWNER BENEFICIAL OWNERSHIP OF CLASS
------------------- --------------------- --------
James "Robby" Robson, Jr. 591,797 (1) 11.3%
1500 East 17th Street
Ada, Oklahoma 74820
Todd Robson 585,161 (2) 11.2%
701 South Shumard
Ada, Oklahoma 74820
James Robson, Sr. 538,851 (3) 10.3%
Route 4, Box 437
Ada, Oklahoma 74820
Brian K. Gourley 58,671 1.1%
305 North Lake Drive
Ada, Oklahoma 74820
Lyle P. Phillips 299,000 (4) 5.7%
11420 High Drive
Leawood, Kansas 66211
Timothy A. Jurek 25,000 .5%
1345 East 29th Street
Tulsa, Oklahoma 74114
All Directors and Executive 2,098,480 40.0%
Officers as a Group (6
Persons)
______________
(1) Includes 572,797 shares held directly, 2,000 shares held by minor
children, 15,000 shares underlying stock options exercisable within 60 days
held directly and 2,000 shares underlying stock options exercisable within 60
days held by Mr. Robson's wife.
(2) Includes 570,161 shares held directly and 15,000 shares underlying stock
options exercisable within 60 days.
(3) Includes 530,351 shares held directly and 7,500 shares underlying stock
options exercisable within 60 days.
(4) Includes 256,000 shares held by a revocable trust of Mr. Phillips; 25,000
shares held by a revocable trust of Mr. Phillips' wife; and 18,000 shares held
by a trust of which Mr. Phillips' wife serves as trustee.
2
<PAGE>
The Company knows of no arrangement or understanding, the operation of
which may at a subsequent date result in a change of control of the Company.
ELECTION OF DIRECTORS
The number of Directors of the Company is currently set at six (6)
Directors. The Board of Directors recommends the election as Directors of the
six (6) nominees listed below, to hold office until the next Annual Meeting of
Shareholders and until their successors are elected and qualified or until
their earlier death, resignation or removal. Each of the current members of
the present Board of Directors has been nominated for reelection. The person
named as "Proxy" in the enclosed form of Proxy will vote the shares
represented by all valid returned proxies in accordance with the
specifications of the shareholders returning such proxies. If at the time of
the Meeting any of the nominees named below should be unable to serve, which
event is not expected to occur, the discretionary authority provided in the
Proxy will be exercised to vote for such substitute nominee or nominees, if
any, as shall be designated by the Board of Directors.
The following table sets forth the name and age of each nominee for
Director, indicating all positions and offices with the Company presently
held, and the period during which each person has served as a Director:
POSITIONS AND OFFICES HELD AND
NAME AGE TERM AS A DIRECTOR
----- --- -------------------------------
James "Robby" Robson, Jr. 41 President, Chief Executive Officer and
Director since December 1997
Todd Robson 37 Vice President, Secretary, Treasurer
and Director since December 1997
James Robson, Sr. 61 Vice President and Director since
December 1997
Brian K. Gourley 38 Director since January 1998
Timothy A. Jurek 49 Director since September 1999
Lyle P. Phillips 62 Director since September 1999
There is no family relationship between any Director or Executive Officer
of the Company except that James "Robby" Robson, Jr. and Todd Robson are
brothers and their father is James Robson, Sr.
The Company has an audit committee which consists of Brian K. Gourley,
Lyle P. Phillips and Todd Robson. The audit committee reviews the annual
financial statements, any significant accounting issues, and the scope of the
audit with the independent auditors and discusses with the auditors any other
audit-related matters that may arise. During the fiscal year ended March 31,
2000, the audit committee held one meeting.
Set forth below are the names of all Directors and Executive Officers of
the Company, all positions and offices with the Company held by each such
person, the period during which he has served as such, and the principal
occupations and employment of such persons during at least the last five
years:
3
<PAGE>
JAMES "ROBBY" ROBSON, JR. - President, Chief Executive Officer and
Director. Mr. Robson has served as the President, Chief Executive Officer and
a Director of the Company since December 1997, and has held these same
positions with Pontotoc Production Company, Inc., the Company's wholly-owned
subsidiary, since January 1987. From January 1985 through January 1987, he
worked as a consultant for Pontotoc Production Company, Inc. From April 1982
until January 1985, he served as the President of Robco Oil Co. From August
1981 until March 1982 he served as Vice President of Marketing for Daner Oil
Co., Inc. From March 1981 until August 1981, he was a free agent running back
with the Pittsburgh Steelers. Mr. Robson attended Youngstown State University
from 1977 until 1981.
TODD ROBSON - Vice President, Secretary, Treasurer and Director. Mr.
Robson has served as Vice President, Secretary and a Director of the Company
since December 1997, and has held these same positions with Pontotoc
Production Company, Inc., the Company's wholly-owned subsidiary, since January
1987. From January 1985 until January 1987, he served as President and a
Director of Pontotoc Production Company, Inc. From January 1983 until January
1985, he was Vice President of Marketing for Robco Oil Co., Inc.
JAMES ROBSON, SR. - Vice President and Director. Mr Robson has served as
Vice President and Director of the Company since December 1997, and has held
these same positions with Pontotoc Production Company, Inc., the Company's
wholly-owned subsidiary, since January 1985. From April 1982 until January
1985, he served as Vice President of Operations for Robco Oil Co., Inc.
BRIAN K. GOURLEY - Director. Mr. Gourley has served as a Director of the
Company since January 1998. He has served as Chief Operating Officer and a
Partner of BetterBody Company, Ada, Oklahoma, a company engaged in orthopedic
manufacturing, since January 1998. From April 1989 until January 1997, he
served as Vice President of Operations and a Partner of Look, Inc., a company
engaged in manufacturing medical eye implant devices. From April 1986 until
April 1989, he was the Production Engineering Manager and Chief Engineer of
Electrovert USA Corp.
TIMOTHY A. JUREK - Director. Mr. Jurek has served as a Director of the
Company since September 1999. He has served as the President of Pontotoc
Gathering LLC since March 1999. He worked as a project engineer for Conoco
from 1978 until 1981. In 1981, he formed Western States Gas, the first of
five natural gas gathering and marketing companies which Mr. Jurek founded and
operated between 1981 and 1999. He has provided independent consulting
services to the gas industry, been involved with acquisitions and mergers,
served as an officer and director and has been a member of gas industry
associations.
LYLE P. PHILLIPS - Director. Mr. Phillips has served as a Director of
the Company since September 1999. Mr. Phillips has been a private investor
since August 1993. From September 1989 to August 1993, he served as Vice
Chairman and as a director of First Continental Bank & Trust Co. From March
1991 until December 1992, he also served as the President and CEO of First
Continental Bank & Trust. From September 1981 to June 1988, Mr. Phillips
served as Vice Chairman, President and CEO of Kustom Electronics.
The Company's Directors hold office until the next annual meeting of the
shareholders and until their successors have been elected and qualified.
The Officers of the Company are elected by the Board of Directors at the
first meeting after each annual meeting of the Company's shareholders, and
hold office until their death, or until they shall resign or have been removed
from office.
4
<PAGE>
During the fiscal year ended March 31, 2000, the Company's Board of
Directors held one formal meeting. Each of the Directors were in attendance
at each meeting of the Board of Directors and of the Committees of which they
were members. The Board of Directors also acted by consent on four separate
occasions.
The Company's executive officers hold office until the next annual
meeting of the directors of the Company which is currently scheduled for
September 27, 2000. There are no known arrangements or understandings between
any director or executive officer and any other person pursuant to which any
of the above-named executive officers or directors or nominees was selected as
an officer or director or nominee for director of the Company.
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
Based solely on a review of Forms 3 and 4 and amendments thereto
furnished to the Company during its most recent fiscal year, and Forms 5 and
amendments thereto furnished to the Company with respect to its most recent
fiscal year and certain written representations, no persons who were either a
Director, Officer or beneficial owner of more than 10% of the Company's Common
Stock, failed to file on a timely basis reports required by Section 16(a) of
the Exchange Act during the most recent fiscal year, except that James "Robby"
Robson, Jr. filed three Form 4's late reporting eleven transactions; Todd
Robson filed three Form 4's late reporting eleven transactions; James Robson,
Sr. filed three Form 4's late reporting eight transactions; and Brian K.
Gourley filed one Form 4 late reporting one transaction and reported an
additional transaction late in a Form 5.
COMPENSATION
The following tables set forth information regarding executive
compensation for the Company's President. No executive officer received
compensation in excess of $100,000 for any of the years ended March 31, 2000,
1999 and 1998:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
-----------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
----------------------- ----------------- --------
SECURI-
TIES
UNDERLY-
OTHER RE- ING ALL
ANNUAL STRICTED OPTIONS/ OTHER
NAME AND PRINCIPAL COMPEN- STOCK SARs LTIP COMPEN-
POSITION YEAR SALARY BONUS SATION AWARD(S) (NUMBER) PAYOUTS SATION
------------------ ---- ------- ----- ------ -------- -------- ------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
James "Robby" 2000 $50,160 -- $6,561 -- 15,000 -- --
Robson, Jr., 1999 $36,500 -- $3,504 -- -- -- --
President <FN1>
1998 $84,000 -- $4,806 -- -- -- --
<FN1>
_______________
<FN>
<FN1> Represents dues paid to Oak Hill Country Club.
</FN>
</TABLE>
5
<PAGE>
OPTION/SAR GRANTS IN LAST FISCAL YEAR
Individual Grants
Number of % of Total
Securities Options/SARs
Underlying Granted to Exercise
Options/SARs Employees or Base Expiration
Name Granted(#) in Fiscal Year Price($/Sh) Date
---- ------------ -------------- ----------- ----------
James "Robby"
Robson, Jr. 15,000 14.9% $5.00 3/31/04
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION/SAR VALUES
SECURITIES
UNDERLYING VALUE OF UNEXER-
SHARES UNEXERCISED CISED IN-THE
ACQUIRED OPTIONS MONEY OPTIONS/
ON SARs AT FY-END SARs AT FY-END
EXERCISE VALUE EXERCISABLE/ EXERCISABLE/
NAME (NUMBER) REALIZED UNEXERCISABLE UNEXERCISABLE
---- -------- -------- -------------- ---------------
James "Robby"
Robson, Jr. -0- -0- 15,000 / 0 $28,125 / 0
STOCK OPTION PLAN
During November 1997, the Board of Directors adopted a Stock Option Plan
(the "Plan"), and on November 12, 1997, the Corporation's shareholders
approved the Plan. The Plan authorizes the issuance of options to purchase up
to 500,000 shares of the Company's Common Stock.
The Plan allows the Board to grant stock options from time to time to
employees, officers, directors and consultants of the Company. The Board has
the power to determine at the time that the option is granted whether the
option will be an Incentive Stock Option (an option which qualifies under
Section 422 of the Internal Revenue Code of 1986) or an option which is not an
Incentive Stock Option. Vesting provisions are determined by the Board at the
time options are granted. The option price for any option will be no less
than the fair market value of the Common Stock on the date the option is
granted.
Since all options granted under the Plan must have an exercise price no
less than the fair market value on the date of grant, the Company will not
record any expense upon the grant of options, regardless of whether or not
they are incentive stock options for stock options granted to employees. In
accordance with FASB Interpretation No. 44 of APB25, Accounting for Stock
Issued to Employees, stock options granted to non-employees subsequent to
December 15, 1998 are measured at the fair value of the options. The
Interpretation requires accounting recognition attributable to the service
period remaining subsequent to July 1, 2000. Generally, there will be no
federal income tax consequences to the Company in connection with Incentive
Stock Options granted under the Plan. With regard to options that are not
Incentive Stock Options, the Company will ordinarily be entitled to deductions
for income tax purposes of the amount that option holders report as ordinary
income upon the exercise of such options, in the year such income is reported.
6
<PAGE>
As of March 31, 2000, 92,500 options were outstanding.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
During March 1999, the Company and Timothy A. Jurek (who has
approximately 20 years experience in building and operating natural gas
gathering and marketing companies) formed Pontotoc Gathering LLC for the
purpose of building a gas line which could be used to transport and market gas
from the Company's existing and future wells in Pontotoc County. The Company
and Mr. Jurek are each 45% owners of this LLC and two employees of the LLC own
the other 10%. During September 1999 Mr. Jurek was added to the Company's
Board of Directors.
During the year ended March 31, 2000, the Company recognized
approximately $113,000 in income from Pontotoc Gathering LLC. During 1999,
the Company loaned $70,000 to this LLC under a note agreement which requires
monthly payments of interest at 10% and matures on April 30, 2001. During the
year ended March 31, 2000, the Company received principal payments of $63,700
on this note, leaving an outstanding balance at March 31, 2000 of $6,300.
The Company sells its natural gas to the LLC on an 80/20 contract which
means that the Company receives 80% of the spot price less the cost of
transportation. Prior to setting up this LLC the Company received
approximately 55% of the spot price less the cost of transportation.
Management believes that the terms of the transactions with Pontotoc
Gathering LLC are at least as favorable as those which could be obtained from
nonaffiliated parties.
APPOINTMENT OF INDEPENDENT ACCOUNTANTS
The independent accounting firm of Grant Thornton LLP audited the
financial statements of the Company for the fiscal year ended March 31, 2000,
and has been selected in such capacity for the current fiscal year. At the
direction of the Board of Directors, this appointment is being presented to
the shareholders for ratification or rejection at the Annual Meeting of
Shareholders. If the shareholders do not ratify the appointment of Grant
Thornton LLP, the appointment of auditors will be reconsidered by the Board of
Directors.
It is expected that representatives of Grant Thornton LLP will be present
at the meeting and will be given an opportunity to make a statement if they
desire to do so. It is also expected that the representatives will be
available to respond to appropriate questions from shareholders.
7
<PAGE>
OTHER BUSINESS
As of the date of this Proxy Statement, management of the Company was not
aware of any other matter to be presented at the Meeting other than as set
forth herein. However, if any other matters are properly brought before the
Meeting, the shares represented by valid proxies will be voted with respect to
such matters in accordance with the judgment of the persons voting them. A
majority vote of the shares represented at the meeting is necessary to approve
any such matters.
ANNUAL REPORT
The Company's Annual Report for the fiscal year ending March 31, 2000,
accompanies this Proxy Statement. The Annual Report is not incorporated into
this Proxy Statement and is not to be considered part of the solicitation
material.
DEADLINE FOR RECEIPT OF SHAREHOLDER PROPOSALS
FOR THE ANNUAL MEETING TO BE HELD IN SEPTEMBER 2001
Any proposal by a shareholder intended to be presented at the Company's
Annual Meeting of Shareholders to be held in September 2001 must be received
at the offices of the Company, 808 East Main, Ada, Oklahoma 74820, no later
than April 25, 2001, in order to be included in the Company's proxy statement
and proxy relating to that meeting.
JAMES "ROBBY" ROBSON, JR., PRESIDENT
Ada, Oklahoma
August 23, 2000
<PAGE>
PONTOTOC PRODUCTION, INC.
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints James "Robby" Robson, Jr. with the power
to appoint a substitute, and hereby authorizes him to represent and to vote as
designated below, all the shares of common stock of Pontotoc Production, Inc.
held of record by the undersigned on August 23, 2000, at the Annual Meeting of
Shareholders to be held on September 27, 2000, or any adjournment thereof.
1. Election of Directors:
[ ] FOR all nominees listed below (except as marked to the contrary)
[ ] WITHHOLD authority to vote for all the nominees listed below:
James "Robby" Robson, Jr. Brian K. Gourley
Todd Robson Timothy A. Jurek
James Robson, Sr. Lyle P. Phillips
[INSTRUCTION: To withhold authority to vote for any individual nominee, cross
out that nominee's name above.]
2. The ratification of the appointment of Grant Thornton LLP as the
Company's independent auditors.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. To transact such other business as may properly come before the
meeting.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY
WILL BE VOTED FOR PROPOSALS 1 AND 2.
SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AT THE MEETING IN
ACCORDANCE WITH THE SHAREHOLDER'S SPECIFICATIONS ABOVE. THIS PROXY CONFERS
DISCRETIONARY AUTHORITY IN RESPECT TO MATTERS NOT KNOWN OR DETERMINED AT THE
TIME OF THE MAILING OF THE NOTICE OF THE ANNUAL MEETING OF SHAREHOLDERS TO THE
UNDERSIGNED.
The undersigned hereby acknowledges receipt of the Notice of Annual
Meeting of Shareholders, Proxy Statement and Annual Report.
Dated: _____________, 2000.
________________________________________
________________________________________
Signature(s) of Shareholder(s)
Signature(s) should agree with the name(s) stenciled hereon. Executors,
administrators, trustees, guardians and attorneys should indicate when
signing. Attorneys should submit powers of attorney.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF PONTOTOC
PRODUCTION, INC. PLEASE SIGN AND RETURN THIS PROXY IN THE ENCLOSED
PRE-ADDRESSED ENVELOPE. THE GIVING OF A PROXY WILL NOT AFFECT YOUR RIGHT TO
VOTE IN PERSON IF YOU ATTEND THE MEETING.
