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:
[X} Preliminary Proxy Statement [ ] Confidential, For Use of the
Commission Only (as permitted
by Rule 14a-6e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
_______________________________________________________________________________
Capital Properties, Inc.
_______________________________________________________________________________
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:
_______________________________________________________________________________
(2) Aggregate number of securities to which transaction applies:
_______________________________________________________________________________
(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:
_______________________________________________________________________________
(5) Total fee paid:
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[ ] Fee paid previously with preliminary materials:
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[ ] 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:
_______________________________________________________________________________
(4) Date Filed:
_______________________________________________________________________________
<PAGE>
CAPITAL PROPERTIES, INC.
100 Dexter Road
East Providence, Rhode Island 02914
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
April 27, 1999
PLEASE TAKE NOTICE that the 1999 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 27,
1999 at 2:00 o'clock P.M., local time, for the following purposes:
(1) To amend the By-laws to eliminate mandatory retirement age for
directors;
(2) To amend the By-laws to provide that further amendments to the By-laws
may be adopted by a majority vote of either the board of directors or
the shareholders;
(3) To elect five directors to serve for a term of one year until their
successors are elected and qualified;
(4) To approve the appointment of Lefkowitz, Garfinkel, Champi & DeRienzo
P.C. as independent auditors of the accounts of the Company for 1999;
and
(5) 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 1, 1999 will be entitled to vote.
By Order of the Board of Directors
STEPHEN J. CARLOTTI
Secretary
East Providence, Rhode Island
March , 1999
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.
<PAGE>
CAPITAL PROPERTIES, INC.
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
April 27, 1999
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 27, 1999, 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 , 1999.
VOTING AT MEETING
Only shareholders of record at the close of business on March 1, 1999, 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 3,000,000 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 amending the By-laws, 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 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.
AMENDMENTS TO BY-LAWS
The Board of Directors proposes to amend the By-laws of the Company in two
respects. One relates to the eligibility of directors (Item 1) and the other to
the procedure to amend the By-laws (Item 2).
Item 1: Eligibility to Serve as a Director
The present By-laws provide that any person who has attained the age of 70 years
is no longer eligible to be elected as a director. The Board of Directors
believes that this limitation will force the Company to lose the services of
valuable board members with substantial knowledge of the Company's history and
operations. The proposed amendment would eliminate this age limitation by
deleting the last sentence of Article III, Section 1 of the By-laws.
Item 2: Procedure to Amend the By-laws
Currently, the By-laws may only be amended or repealed at a meeting of the
shareholders by the vote of a majority of the shares present or represented at
the meeting. The Board of Directors believes that this provision unduly
restricts the Board's authority in establishing rules of governance and is
inconsistent with the current practice of most publicly held corporations.
Accordingly, the proposed amendment to Article VII of the By-laws would provide
that either the Board of Directors or the shareholders could amend the By-laws.
Amendments by the directors would require the vote of a majority of the
directors while amendments by the shareholders would require the affirmative
vote of a majority of the shares issued and outstanding and entitled to vote.
The text of the amendment (which restates Article VII of the By-laws in its
entirety) is as follows:
"These By-laws may be altered, amended or repealed, or
new By-laws may be adopted at any annual or special
meeting of the shareholders by an affirmative vote of a
majority of the shares issued and outstanding and
entitled to vote; provided, however, that notice of
such alteration, amendment, repeal or adoption of new
By-laws shall be contained in the notice of such
meeting. The Board of Directors shall have like
authority to alter, amend, repeal or adopt new By-laws
by an affirmative vote of majority of the number of
Directors fixed as provided in these By-laws; provided,
however, that any action in that respect by the Board
of Directors may be changed thereafter by the
shareholders."
Vote Required
The approval of both proposed amendments to the By-laws requires the affirmative
vote of a majority of the shares present or represented at the 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 are
now directors of the Company. Certain information concerning such nominees is
set forth below:
Principal Occupation Director
Name and Age During Past Five Years Since
_______________________________________________________________________________
Robert H. Eder (66)........ Chairman of the Company, June 30, 1995 1995
to present; Chairman, Providence and
Worcester Railroad Company, 1983
to present
Ronald P. Chrzanowski (56).. President of the Company, January 1, 1998
1998 to present; Vice President of the
Company, November 12, 1997 to
December 31, 1997; Vice President of
Providence and Worcester Railroad
Company, 1983-1997
James H. Dodge (58)......... Chairman, Chief Executive Officer and 1997
President, Providence Energy Corporation
Harold J. Harris (70)....... President, Wm. H. Harris, Inc. (Retailer) 1995
Henry S. Woodbridge, Jr.(70). Consultant 1990
Mr. Eder is also a director of Providence and Worcester Railroad Company. Mr.
Dodge is also a director of Providence Energy Corporation. Mr. Harris is also a
director of The Fairchild Corporation.
The Board of Directors has an Audit Committee and a Compensation Committee both
currently comprised of Messrs. Dodge, Harris and Woodbridge. The Audit Committee
is responsible for overseeing the establishment and maintenance of an effective
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 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 during the fiscal year ended December
31, 1998 and the Audit Committee and Compensation Committee each held two
meetings during the fiscal year ended December 31, 1998.
Directors, other than 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.
EXECUTIVE COMPENSATION
The following table summarizes the compensation paid or accrued by the Company
during the three-year period ended December 31, 1998, to each of its executive
officers who earned more than $100,000 in salary and bonus in 1998, for services
rendered in all capacities to the Company during 1998.
SUMMARY COMPENSATION TABLE
Annual Compensation
Name and Principal All Other
Position Year Salary Compensation(1)
_______________________________________________________________________________
Robert H. Eder, Chairman 1998 $155,000 $ --
1997 155,000 --
Ronald P. Chrzanowski, 1998 150,000 11,250
President 1997 2,250 --
Barbara J. Dreyer, Treasurer 1998 109,000 8,175
1997 150,000 11,250
1996 150,000 11,250
(1) Amounts paid directly to the retirement accounts of employees under the
Company's simplified employee pension plan.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
On March 1, 1999, 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:
Number of Percent
Name and Address shares held of Class
_______________________________________________________________________
Robert H. Eder and Linda Eder 1,569,738(1) 52.3%
2441 S.E. Bahia Way
Stuart, Florida 34996
Lance S. Gad 164,280 5.5%
250 Fence Row Drive
Fairfield, Connecticut 06430
(1) Robert H. Eder and Linda Eder are husband and wife, and each holds 784,869
shares directly.
The following table reflects as of March 1, 1999, 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:
Name of Individual or Shares Percent
Identification of Group Owned of Class
Ronald P. Chrzanowski............................. 2,060 *
James H. Dodge.................................... 300 *
Barbara J. Dreyer................................. 6,000 *
Robert H. Eder (1)................................ 1,569,738 52.3%
Harold J. Harris (2).............................. 11,000 *
Henry S. Woodbridge, Jr........................... 4,500 *
All seven directors and officers as a group....... 1,593,598 53.2%
*Less than 1%
(1) Includes 784,869 shares held by his wife, Linda Eder.
(2) Includes 1,000 shares held by his wife in her name
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, (reduced to 10% in 1995) prepayable at any time without penalty. In
March 1998, Railroad prepaid the note in full.
The Wilkesbarre Pier (the Pier) is a deep-water pier in East Providence, Rhode
Island, which is integral to the operation of the petroleum storage facilities
(the Facilities) in East Providence, Rhode Island. The Pier and the Facilities
are connected by two petroleum pipelines. In 1995, the Company and Railroad (the
owner of the Pier) entered into an agreement which, among other provisions, gave
the Company the right to acquire the Pier for $1.
Effective January 1, 1998, Railroad and a company which uses the Pier to
off-load product (Oil Company) entered into an agreement (the Agreement) whereby
Oil Company agreed to pay annual fees for five years, which range from $185,000
to $235,000. Under the terms of the Agreement, the owner of the Pier is not
required to make any repairs to the Pier. The Agreement may be terminated by Oil
Company upon ninety (90) days' notice only in the event of a failure of a
component of the Pier that the owner does not repair.
In January 1998, the Company exercised its right and acquired the Pier; and
Railroad assigned its rights under the Agreement to the Company.
A trust for the benefit of the Company's controlling shareholder (the Trust) was
party to an agreement (the Pipeline Agreement) with respect to the use of the
two petroleum pipelines which connect the Pier to the Facilities. Since February
1983, the Company and any operator of its Facilities have had the right to use
the pipelines for the transportation of petroleum products in consideration for
which the Company assumed all of the Trust's obligations for repair and
maintenance under the Pipeline Agreement and agreed to pay to the Trust a fee
based upon the number of barrels of product transported through the pipelines.
In 1997, the Company paid $20,000 to the Trust and was not required to make any
payment with respect to maintenance and other expenses.
In December 1997, the Trust entered into an agreement with Oil Company which
owns the two petroleum pipelines, under which Oil Company released the Trust
from liability in connection with the pipelines for any costs incurred by Oil
Company prior to the date of the agreement. Further, under the agreement the
Trust is responsible for its proportionate share of a future repair or
replacement to the pipelines in excess of $25,000. The Company had the option to
purchase the rights of the Trust under the Pipeline Agreement and exercised its
option in January 1998, acquiring all rights of the Trust for $50,000.
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 1998, be appointed as independent auditors of the
accounts of the Company for the year 1999. 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, 1998
is enclosed. Such report is not part of this proxy statement.
ADDITIONAL INFORMATION
The Company will provide without charge to each shareholder entitled to vote at
the 1999 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 1998. Requests for copies of such report should be addressed
to the Company at 100 Dexter Road, East Providence, Rhode Island 02914,
Attention: Treasurer.
PROPOSALS FOR 2000 ANNUAL MEETING
The 2000 annual meeting of the shareholders of the Company is scheduled to be
held April 25, 2000. 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 25, 1999.
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
STEPHEN J. CARLOTTI
Secretary
Dated March , 1999
<PAGE>
CAPITAL PROPERTIES, INC.
Annual Meeting of Shareholders -- April 27, 1999
The undersigned, whose signature appears on the reverse side of this proxy,
hereby appoints Robert H. Eder and Stephen J. Carlotti, or either of them, each
with full power of substitution, acting jointly or singly if only one be present
and acting, 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 27, 1999 in Providence, Rhode
Island, and at any adjournments thereof, as follows:
1. PROPOSAL TO AMEND THE BY-LAWS to eliminate mandatory retirement age for
directors:
_____FOR _____AGAINST _____ABSTAIN
2. PROPOSAL TO AMEND THE BY-LAWS to provide that further amendments to the
By-laws may be adopted by a majority vote of either the board of directors
or the shareholders:
_____FOR _____AGAINST _____ABSTAIN
3. ELECTION OF DIRECTORS:
FOR all nominees listed below WITHHOLD AUTHORITY to vote
except as marked to the for all nominees listed
contrary below ___ below ______
R.H. Eder, R.P. Chrzanowski, J.H. Dodge, H.J. Harris, and H.S. Woodbridge, Jr.
(INSTRUCTION: To withhold authority to vote for any individual nominee, write
that nominee's name in the space provided below.)
_______________________________________________________________________________
4. PROPOSAL TO APPROVE THE APPOINTMENT OF LEFKOWITZ, GARFINKEL, CHAMPI &
DERIENZO P.C. as independent public accountants of the Company for 1998:
_____FOR _____AGAINST _____ABSTAIN
5. 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, 2, 3 and 4.
PLEASE DATE, SIGN AND RETURN THIS PROXY
(Sign exactly as your names appear Dated__________________________1999
hereon. When signing as attorney,
executor, administrator, trustee, Signed_____________________________
guardian or in a corporate capacity,
please give full title as such. ___________________________________
In case of joint tenants or multiple
owners, each party must sign.)
