CAPITAL PROPERTIES, INC.
One Hospital Trust Plaza
Suite 920
Providence, Rhode Island 02903
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
April 29, 1997
PLEASE TAKE NOTICE that the 1997 annual meeting of shareholders of Capital
Properties, Inc. (the "Company") will be held at the offices of Hinckley,
Allen and Snyder, 1500 Fleet Center in Providence, Rhode Island, on Tuesday,
April 29, 1997 at 2:00 o'clock P.M., local time, for the following purposes:
(1) To elect five directors to serve for a term of one year and until
their successors are elected and qualified;
(2) To approve the appointment of Lefkowitz, Garfinkel, Champi &
DeRienzo P.C. as independent auditors of the accounts of the
Company for 1997; and
(3) To transact such other business, if any, as may properly come
before the meeting or any adjournment or adjournments thereof.
Holders of record of the common stock on the books of the Company as of the
close of business on March 3, 1997 will be entitled to vote.
By Order of the Board of Directors
EDWIN G. TORRANCE
Secretary
CAPITAL PROPERTIES, INC.
Providence, Rhode Island
March 24, 1997
Kindly fill in, date and sign the enclosed proxy and promptly return it in the
enclosed addressed envelope, which requires no postage if mailed in the
United States. If you are personally present at the meeting, the proxy will
not be used without your consent.
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CAPITAL PROPERTIES, INC.
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
April 29, 1997
SOLICITATION AND REVOCATION OF PROXIES
The accompanying proxy is solicited by the Board of Directors of Capital
Properties, Inc. (the "Company"), in connection with the annual meeting of
shareholders to be held April 29, 1997, and the Company will bear the cost of
such solicitation. It is expected that the solicitation of proxies will be
primarily by mail. Proxies may also be solicited personally by regular
employees of the Company at nominal cost. The Company may reimburse
brokerage houses and other custodians, nominees and fiduciaries holding
stock for others in their names, or in those of their nominees, for their
reasonable out-of-pocket expenses in sending proxy materials to their
principals or beneficial owners and obtaining their proxies. Any
shareholder giving a proxy has the power to revoke it at any time prior to
its exercise, but the revocation of a proxy will not be effective until
notice thereof has been given to the Secretary of the Company. Notice of
revocation may be delivered in writing to the Secretary prior to the meeting
or may be transmitted orally to the Secretary at the meeting. Every properly
signed proxy will be voted in accordance with the specifications made thereon.
This proxy statement and the accompanying proxy are expected to be first
sent to shareholders on March 24, 1997.
VOTING AT MEETING
Only shareholders of record at the close of business on March 3, 1997, will
be entitled to vote at the meeting. Under the Company's articles of
incorporation, each shareholder has one vote for every share owned. On the
record date, there were 1,000,000 shares of common stock of the Company
outstanding. There were no other outstanding securities of the Company
entitled to vote.
The directors will be elected in each case by vote of the holders of a
majority of the shares present or represented at the meeting.
Shares represented by proxies which are marked "withhold authority" with
respect to the election of any particular nominee for director, "abstain"
with respect to the approval of independent auditors, or to deny
discretionary authority on any other matters will be counted as shares
present and entitled to vote, and accordingly any such marking of a proxy
will have the same effect as a vote against the proposal to which it relates.
Brokers who hold shares in street name may lack
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authority to vote such shares on certain items, absent specific instructions
from their customers. Shares subject to such "broker non-votes" will not be
treated as shares entitled to vote on the matters to which they relate and
therefore will be treated as not present at the meeting for those purposes,
but otherwise will have no effect on the outcome of the voting on such
matters. It is not presently anticipated that any matter which might be the
subject of a "broker non-vote" will come before the annual meeting.
ELECTION OF DIRECTORS
At the annual meeting, five directors are to be elected to hold office until
the next annual meeting and until their respective successors are elected and
qualified. The proxies named in the accompanying proxy, who have been
designated by the Board of Directors, intend to vote, unless otherwise
instructed, for the election to the Board of Directors of the persons named
below, all of whom, with the exception of Mr. Dodge, are now directors of the
Company. Certain information concerning such nominees is set forth below:
<TABLE>
<S> <C> <C>
Principal Occupation Director
Name and Age During Past Five Years Since
Robert H. Eder (64) Chairman, Providence and 1995
Worcester Railroad Company
James H. Dodge (56) Chairman, Chief Executive Officer
and President, Providence
Energy Corporation
Barbara J. Dreyer (58) President and Treasurer of the 1987
Company, 1995 to present;
Secretary-Treasurer of the
Company, 1987-1995
Harold J. Harris (68) President, Wm. H. Harris, Inc. 1995
(Retailer)
Henry S. Woodbridge, Jr.(68) Consultant, 1994 to present; 1990
Retired, 1993-l994;
President, Rhode Island
Anti-Drug Coalition, 1991-1993
</TABLE>
Mr. Eder is also a director of Providence and Worcester Railroad Company.
Mr. Dodge is also a director of Providence Energy Corporation and affiliates,
including Providence Gas Company.
The Board of Directors has an Audit Committee and a Compensation Committee
both currently comprised of Gayl W. Doster, Harold J. Harris and Henry S.
Woodbridge, Jr. The Audit Committee is responsible for overseeing the
establishment and maintenance of an effective
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financial control environment for the Company, for overseeing procedures for
evaluating the system of internal accounting control and for evaluating audit
performance. The Compensation Committee, chaired by a director who is not
standing for reelection at the annual meeting, is responsible for
recommending to the full Board of Directors appropriate compensation levels
for all officers of the Company. The Board does not have a nominating
committee or a committee performing a similar function.
The Board of Directors held four meetings and the Audit Committee held three
meetings during the fiscal year ended December 31, 1996. The Compensation
Committee held one meeting during the fiscal year ended December 31, 1996.
Directors, other than Mr. Eder and directors who are employed by the Company,
received a fee of $750 for attendance at each meeting of the Board of
Directors, together with related transportation and living expenses.
Each member of the Audit and Compensation Committee received $250 for each
attended meeting of that committee.
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Annual Compensation
<S> <C> <C> <C>
Other Annual
Name and Principal Compensation
Position Year Salary ($) $ (1)
Barbara J. Dreyer, 1996 $150,000 $11,250
President and 1995 128,400 9,630
Treasurer 1994 111,878 15,104
</TABLE>
(1) Amounts paid directly to the account of Ms. Dreyer under the Company's
simplified employee's pension plan.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
On March 3, 1997, to the best of the Company's knowledge, no person
(including any "group", as that term is used in Section 13(d)(3) of the
Securities Exchange Act of 1934) was the beneficial owner of more than five
per cent of the Company's outstanding common stock, $1.00 par value, except
as follows:
<TABLE>
<S> <C> <C>
Number Percent
Name and Address of shares held of Class
Robert H. Eder and Linda Eder 523,246 (1) 52.3%
2441 S.E. Bahia Way
Stuart, Florida 34996
</TABLE>
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<TABLE>
<S> <C> <C>
Lance S. Gad 54,760 5.5%
1250 Fence Row Drive
Fairfield, Connecticut 06430
</TABLE>
(1) Robert H. Eder and Linda Eder are husband and wife, and each holds
261,623 shares directly.
The following table reflects as of March 1, 1997, the beneficial ownership of
shares of common stock of the Company by directors, nominees for director and
officers of the Company, all shares being owned directly except as otherwise
noted:
<TABLE>
<S> <C> <C>
Name of Individual or Shares Percent
Identification of Group Owned of Class
James H. Dodge 100 *
Gayl W. Doster 200 *
Barbara J. Dreyer 1,700 *
Robert H. Eder (1) 523,246 52.3%
Harold J. Harris 1,500 *
Henry S. Woodbridge, Jr. 1,000 *
All directors and officers
as a group (6) 527,746 52.8%
</TABLE>
(1) Includes 261,623 shares held by his wife, Linda Eder, who was Vice
President of the Company to December 27, 1996.
*Less than 1%
CERTAIN TRANSACTIONS
In 1988, in accordance with a plan of distribution, the Company transferred
the ownership of Providence and Worcester Railroad Company (Railroad) to the
Company's shareholders. The Company and Railroad have a common controlling
shareholder. As part of the plan, the Company received a promissory note in
the amount of $9,377,000 payable over a period of twenty years with interest
at 12% per year, prepayable at any time without penalty. Such prepayments
reduced the required monthly payments without changing the term of the note.
During 1995, Railroad informed the Company that it had secured a commitment
from a bank which would enable it to borrow funds in an amount sufficient to
prepay the entire balance of its note at an interest rate below 10%. The
Company and Railroad negotiated an agreement reducing the interest rate to
10% upon Railroad's prepayment of $1,800,000 on its note, the proceeds of
which were used by the Company to prepay in full its note payable to a bank
in the amount of $1,755,000.
The agreement further provided that the first $200,000 of any future
prepayments would reduce the required monthly payments over the remaining
term of the note. Thereafter, 50% of any additional prepayments will
reduce the required monthly payments, and the balance will be
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applied to reduce the note in inverse order of maturity of the remaining
principal payments. During 1996, Railroad made a voluntary prepayment of
$200,000, which prepayment (together with the interest rate adjustment)
results in a current monthly payment of principal and interest over the
remaining twelve-year term in the amount of $53,000.
During 1995, the Company also entered into an agreement with Railroad
releasing a portion of the collateral securing the note in exchange for the
right to require Railroad to convey the Wilkesbarre Pier (the Pier) in East
Providence, Rhode Island for the sum of $1 to a purchaser of the Facilities,
should the Company sell the Facilities. The Pier is used by the Company or
its tenant for the berthing of vessels which off-load petroleum products
which are transported by pipeline to the Facilities.
The note is now secured by a first mortgage on a significant portion of
Railroad's operating right-of-way in Massachusetts, exclusive of the track
structure (which includes rails, ties, fasteners and ballast).
Robert H. Eder, a director of the Company, is also a director of Railroad.
As of March 3, 1997, Mr. Eder and his wife, Linda Eder, beneficially own
52.3% of the Company's common stock and 46% of the common stock and 77% of
the preferred stock of Railroad. Linda Eder received a salary of $87,839 as
Vice President of the Company; she resigned her position as of December 27,
1996. In addition, for 1996 $6,587 was paid directly to the account of Mrs.
Eder under the Company's simplified employee's pension plan.
INDEPENDENT PUBLIC ACCOUNTANTS
The Audit Committee of the Board of Directors has recommended that Lefkowitz,
Garfinkel, Champi & DeRienzo P.C., who acted as independent auditors of the
accounts of the Company for 1996, be appointed as independent auditors of the
accounts of the Company for the year 1997. The Company has recently been
advised by Lefkowitz, Garfinkel, Champi & DeRienzo P.C. that they have no
direct financial interest or any material indirect financial interest in the
Company, nor have they had any connection during the past three years with
the Company in the capacity of promoter, underwriter, voting trustee,
director, officer or employee.
It is expected that a representative of Lefkowitz, Garfinkel, Champi &
DeRienzo P.C. will be present at the annual meeting with the opportunity to
make a statement if he so desires and that such representative will be
available to respond to appropriate questions.
FINANCIAL STATEMENTS
A copy of the annual report of the Company for the year ended December 31,
1996 is enclosed. Such report is not part of this proxy statement.
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ADDITIONAL INFORMATION
The Company will provide without charge to each shareholder entitled to vote
at the 1997 annual meeting, on the written request of any such shareholder,
a copy of the Company's annual report to the Securities and Exchange
Commission on Form 10-KSB for the year 1996. Requests for copies of such
report should be addressed to the Company at One Hospital Trust Plaza, Suite
920, Providence, Rhode Island 02903, Attention: Treasurer.
PROPOSALS FOR 1998 ANNUAL MEETING
The 1998 annual meeting of the shareholders of the Company is scheduled to be
held April 28, 1998. If a shareholder intending to present a proposal at that
meeting wishes to have a proper proposal included in the Company's proxy
statement and form of proxy relating to the meeting, the shareholder must
submit the proposal to the Company not later than November 28, 1997.
OTHER MATTERS
No business other than that set forth in the attached Notice of Meeting is
expected to come before the annual meeting, but should any other matters
requiring a vote of shareholders 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 interests of the Company. In the
event any of the nominees for the office of director should withdraw or
otherwise become unavailable for reasons not presently known, the persons
named as proxies will vote for other persons in their place in what they
consider the best interests of the Company.
By Order of the Board of Directors
EDWIN G. TORRANCE
Secretary
CAPITAL PROPERTIES, INC.
Dated March 24, 1997
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CAPITAL PROPERTIES, INC.
Annual Meeting of Shareholders -- April 29, 1997
The undersigned, whose signature appears on the reverse side of this
proxy, hereby appoints Barbara J. Dreyer, Robert H. Eder and Edwin G.
Torrance, or a majority of such of them as shall be present, attorneys with
power of substitution and with all the powers the undersigned would possess
if personally present, to vote the stock of the undersigned in Capital
Properties, Inc, at the annual meeting of shareholders to be held April 29,
1997 in Providence, Rhode Island, and at any adjournments thereof, as follows:
1. ELECTION OF DIRECTORS:
FOR all nominees listed below (except WITHHOLD AUTHORITY to vote for
as marked to the contrary below ___ all nominees listed below ______
R. H. Eder B. J. Dreyer J. H. Dodge, H. J. Harris H. S. Woodbridge, Jr.
(INSTRUCTION: To withhold authority to vote for any individual nominee,
write that nominee's name in the space provided below.)
______________________________________________________________________________
2. PROPOSAL TO APPROVE THE APPOINTMENT OF LEFKOWITZ, GARFINKEL, CHAMPI &
DERIENZO P.C. as independent public accountants of the Company for 1997:
_____FOR _____AGAINST _____ABSTAIN
3. In their discretion, upon such other matters as may properly come before
the meeting.
This proxy when properly executed will be voted in the manner directed
herein by the undersigned stockholder. If no direction is made, this
proxy will be voted for Proposals 1 and 2.
<PAGE>
PLEASE DATE, SIGN AND RETURN THIS PROXY
(Sign exactly as your names appear hereon. Dated:___________________, 1997
When signing as attorney, executor, admin-
istrator, trustee, guardian or in a
corporate capacity, please give full Signed_______________________
title as such. In case of joint tenants
or multiple owners, each party must sign.) ______________________________
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE COMPANY.
