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:
(X) Preliminary Proxy Statement ( ) Confidential, for Use of the
Commission Only (as permitted
by Rule 14a-6(e)(2))
( ) Definitive Proxy Statement
( ) Definitive Additional Materials
( ) Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
PETROLEUM & RESOURCES CORPORATION
(Name of Registrant as Specified in its Charter)
(Name of Person(s) Filing Proxy Statement, if other than 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)(4) 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:
( ) 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:
2) Form, Schedule, or Registration Statement No.:
3) Filing Party:
4) Date Filed:
<PAGE>
PETROLEUM & RESOURCES CORPORATION
Seven St. Paul Street
Baltimore, Maryland 21202
----------------------------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
FEBRUARY 14, 2000
----------------------------------------------
Notice is hereby given that the Annual Meeting of Stockholders of
PETROLEUM & RESOURCES CORPORATION, a Maryland corporation (the "Corporation"),
will be held at The Colony Palm Beach, 155 Hammon Avenue, Palm Beach, Florida,
on Tuesday, March 28, 2000, at 10:00 a.m., for the following purposes:
(a) to elect directors as identified in the Proxy Statement for the
ensuing year;
(b) to consider and vote upon the ratification of the selection of
PricewaterhouseCoopers LLP as the firm of independent accountants to audit the
books and accounts of the Corporation for or during the year ending December
31, 2000;
(c) to consider and vote upon a proposed amendment to Article SIXTH of the
Articles of Incorporation to increase the number of authorized shares of Common
Stock of the Corporation from 25,000,000 shares to 50,000,000 shares;
(d) to consider and vote upon amending the Corporation's investment policy
to change its subclassification from a diversified investment company to a
non-diversified investment company; and
(e) to transact such other business as may properly come before the
meeting or any adjournment thereof.
The Board of Directors has fixed the close of business on February 14,
2000, as the record date for the determination of the stockholders entitled to
notice of and to vote at this meeting.
By order of the Board of Directors,
LAWRENCE L. HOOPER, JR.
VICE PRESIDENT, SECRETARY AND
GENERAL COUNSEL
Baltimore, MD
NOTE: STOCKHOLDERS WHO DO NOT EXPECT TO ATTEND THE MEETING ARE REQUESTED
TO FILL IN, SIGN, DATE AND RETURN THE ACCOMPANYING PROXY IN THE ENCLOSED
ENVELOPE WITHOUT DELAY.
<PAGE>
PETROLEUM & RESOURCES CORPORATION
Seven St. Paul Street
Baltimore, MD 21202
-------------
PROXY STATEMENT
-------------
This proxy statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Petroleum & Resources Corporation, a
Maryland corporation (the "Corporation"), for the Annual Meeting of
Stockholders to be held on Tuesday, March 28, 2000, and is first being sent to
stockholders on or about February 17, 2000.
Only stockholders of record at the close of business on February 14, 2000
may vote at the Annual Meeting to be held on March 28, 2000. On the record
date, the Corporation had outstanding shares of Common Stock ("Common
Stock").
The holders of the Common Stock shall be entitled to one vote per share.
The Corporation has no other class of security outstanding. Directors shall be
elected by a plurality of the votes cast at the meeting. Proposal (b) referred
to below requires the affirmative vote of a majority of the votes cast at the
meeting. Proposal (c) referred to below requires the affirmative vote of a
majority of all the shares entitled to be cast at the meeting. Proposal (d)
referred to below requires the affirmative vote of the lesser of (i) 67% of all
the outstanding shares of Common Stock present or represented at the meeting
(assuming that more than 50% of the outstanding shares of Common Stock are
present or represented at the meeting) or (ii) a majority of all of the
outstanding shares of Common Stock. Unless otherwise required by the
Corporation's Articles of Incorporation or By-laws, or by applicable Maryland
law, any other matter properly presented for a vote at the meeting will require
the affirmative vote of a majority of the votes cast at the meeting. Shares of
Common Stock represented by proxies that are marked "withhold authority" (with
respect to the election of any nominee for election as director), or marked
abstain, or which constitute a broker non-vote will be counted as present at
the meeting for determining a quorum. (Broker non-votes occur when a nominee
holding shares for a beneficial owner has not received voting instructions from
the beneficial owner and such nominee does not possess or choose to exercise
discretionary authority with respect thereto.) With respect to any matter to be
decided by a plurality or majority of the votes cast at the meeting, proxies
marked "withhold authority" (with respect to the election of any nominee for
election as director), or marked abstain, or which constitute a broker non-vote
will not be counted for the purpose of determining the number of votes cast at
the meeting, and therefore will have no effect on any such vote. With respect
to any matter to be decided by a majority of all of the votes entitled to be
cast at the meeting, proxies marked abstain or which constitute a broker
non-vote will have the effect of a negative vote.
The purposes for which the Annual Meeting to be held on March 28, 2000 is
being called are: (a) election of directors of the Corporation; (b)
ratification of the selection of PricewaterhouseCoopers LLP as the firm of
independent accountants to audit the books and accounts of the Corporation for
or during the year ending December 31, 2000; (c) the approval of a proposed
amendment to the Articles of Incorporation increasing the authorized shares of
Common Stock; (d) approving a change of the Corporation's investment policy
from that of a diversified investment company to a non-diversified investment
company; and (e) transaction of such other business as may properly come before
said meeting or any adjournment thereof. At the date of this proxy statement,
the only business that the management intends to present, or knows that others
will present at the meeting, are Proposals (a), (b), (c) and (d)
1
<PAGE>
referred to above. Should any other matter come before the meeting, however,
action may be taken thereon pursuant to proxies in the form enclosed.
Except for Proposals (a), (b), (c) and (d) referred to above, the proxies
confer discretionary authority on the persons named therein or their
substitutes with respect to any business that may properly come before the
meeting. Any stockholder executing and returning a proxy in the enclosed form
has the power to revoke such proxy at any time prior to the voting thereof by
written notice to the Corporation, by executing a later dated proxy, or by
appearing and voting at the meeting. Properly executed proxies will be voted as
directed, but, if no direction is specified, the shares covered by a given
proxy will be voted in favor of Proposals (a), (b), (c) and (d).
The Corporation will pay all costs of soliciting proxies in the
accompanying form. See "Other Matters" below. Solicitation will be made by
mail, and officers, regular employees, and agents of the Corporation may also
solicit proxies by telephone or personal interview. The Corporation expects to
request brokers and nominees who hold stock in their names to furnish this
proxy material to their customers and to solicit proxies from them, and will
reimburse such brokers and nominees for their out-of-pocket and reasonable
clerical expenses in connection therewith.
(A) ELECTION OF DIRECTORS
Unless contrary instructions are given by the stockholder signing a proxy,
it is intended that each proxy in the accompanying form will be voted at the
Annual Meeting for the election of the following nominees to the Board of
Directors for the ensuing year, all of whom have consented to serve if elected:
Enrique R. Arzac W. D. MacCallan Landon Peters
Daniel E. Emerson W. Perry Neff John J. Roberts
Thomas H. Lenagh Douglas G. Ober Susan C. Schwab
Robert J. M. Wilson
If for any reason one or more of the nominees above named shall become
unable or unwilling to serve (which is not now expected) when the election
occurs, proxies in the accompanying form will, in the absence of contrary
instructions, be voted for the election of the other nominees above named and
may be voted for substitute nominees in the discretion of the persons named as
proxies in the accompanying form. The directors elected will serve until the
next annual meeting or until their successors are elected, except as otherwise
provided in the By-laws of the Corporation.
INFORMATION AS TO NOMINEES FOR ELECTION AS DIRECTORS (AS OF DECEMBER 31,
1999*):
Set forth below with respect to each nominee for director are his or her
name and age, any positions held with the Corporation, other principal
occupations during the past five years, other directorships and business
affiliations, the year in which he or she first became a director, and the
number of shares of Common Stock beneficially owned by him or her. Also set
forth below is the number of shares of Common Stock beneficially owned by all
directors and officers of the Corporation as a group.
- ----------
* The information for Dr. Susan C. Schwab is as of January 13, 2000.
2
<PAGE>
<TABLE>
<CAPTION>
SHARES OF
COMMON
HAS STOCK
BEEN A BENEFICIALLY
NAME, AGE, POSITIONS WITH THE CORPORATION, DIRECTOR OWNED
OTHER PRINCIPAL OCCUPATIONS AND OTHER AFFILIATIONS(A) SINCE (B)(C)(D)(E)(F)
------------------------------------------------------ ---------- ----------------
<S> <C> <C>
Enrique R. Arzac, 58, Professor of Finance and Economics, formerly Vice Dean of 1987 1,762
Academic Affairs of the Graduate School of Business, Columbia University. Director
of The Adams Express Company, BEA Income Fund, Inc., BEA Strategic Income
Fund, Inc., Brazilian Equity Fund, Chile Fund, Emerging Markets Infrastructure
Fund, Emerging Markets Telecommunications Fund, First Israel Fund, Latin America
Equity Fund, Latin America Investment Fund and Portugal Fund (investment
companies).
Daniel E. Emerson, 75, Retired Executive Vice President of NYNEX Corporation, 1987 3,757
retired Chairman of the Board of both NYNEX Information Resources Co. and
NYNEX Mobile Communications Co. Previously, Executive Vice President and
Director of New York Telephone Company. Presently, Past Chairman, National Board
of Directors, YMCA of the U.S.A. Director of The Adams Express Company and
Clifford of Vermont (cable and wire distribution).
Thomas H. Lenagh, 81, Financial Advisor, formerly Chairman of the Board and Chief 1987 1,268
Executive Officer of Greiner Engineering Inc. (formerly Systems Planning Corp.)
(consultants), formerly financial vice president, Aspen Institute (research), and
financial advisor and prior thereto Treasurer of the Ford Foundation (charitable
foundation). Director of Gintel Fund, Clemente Strategic Fund, and The Adams
Express Company (investment companies), ICN Pharmaceuticals Inc., ASD Group
(electronic contract manufacturing), and Inrad Corp. (crystals).
W. D. MacCallan, 72, Retired Chairman of the Board and Chief Executive Officer of 1971 13,006
the Corporation. Director, former Chairman of the Board and Chief Executive Officer
of The Adams Express Company, formerly consultant to the Corporation and The
Adams Express Company. Previously, Director of the Hanover Funds, Inc. and the
Hanover Investment Funds, Inc. (investment companies). Presently, Trustee, Vista
Family of Mutual Funds (fifty funds).
W. Perry Neff, 72, Private Financial Consultant, Retired Executive Vice President of 1971 759
Chemical Bank. Director of The Adams Express Company. Previously, Chairman of
the Board and Director of both the Hanover Funds, Inc. and the Hanover Investment
Funds, Inc. (investment companies) and a Director of Van Deventer & Hoch
(investment company). Presently, Trustee, Vista Family of Mutual Funds (fifty funds).
*Douglas G. Ober, 53, Chairman of the Board and Chief Executive Officer of the 1989 38,851
Corporation since April 1, 1991. Director, Chairman of the Board and Chief
Executive Officer of The Adams Express Company.
Landon Peters, 69, Private Investor, formerly Investment Manager, Y.M.C.A. 1987 912
Retirement Fund. Formerly Executive Vice President and Treasurer and prior thereto
Senior Vice President and Treasurer of The Bank of New York. Director of The
Adams Express Company.
John J. Roberts, 77, Senior Advisor, formerly Vice-Chairman, External Affairs, 1987 952
American International Group, Inc. (insurance). Formerly Chairman and Chief
Executive Officer of American International Underwriters Corporation (insurance).
Previously President of American International Underwriters Corporation-U.S./
Overseas Operations. Director of American International Group, Inc. and The Adams
Express Company.
Susan C. Schwab, 44, Dean of the School of Public Affairs at the University of 2000+ 0
Maryland, College Park. Formerly Director of Corporate Business Development at
Motorola, Inc. Also served as an Assistant Secretary of Commerce for the U.S. and
Foreign Commercial Service of the U.S. Department of Commerce. Director of
Calpine Corp. (energy) and The Adams Express Company.
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
SHARES OF
COMMON
HAS STOCK
BEEN A BENEFICIALLY
NAME, AGE, POSITIONS WITH THE CORPORATION, DIRECTOR OWNED
OTHER PRINCIPAL OCCUPATIONS AND OTHER AFFILIATIONS(A) SINCE (B)(C)(D)(E)(F)
----------------------------------------------------- ---------- ----------------
<S> <C> <C>
Robert J. M. Wilson, 79, Retired President of the Corporation. Director and retired 1975 6,812
President of The Adams Express Company.
Directors and executive officers of the Corporation as a group. 187,322
</TABLE>
- ---------------------
* Mr. Ober is an "interested person," as defined by the Investment Company Act
of 1940, because he is an officer of the Corporation.
+ Dr. Schwab was elected by the Board of Directors to serve as a director on
January 13, 2000, to fill the vacancy created when Mr. Allan Comrie resigned
as a director.
(a) Each nominee is also a nominee for the Board of Directors of The Adams
Express Company (see "Principal Stockholder" below).
(b) To the Corporation's knowledge, other than shares referred to in footnotes
(c), (d) and (e) below, each director had sole investment and voting power
with respect to the shares shown opposite his or her name, except Mr.
Lenagh, who had only investment power.
(c) Of the amounts shown, 7,377 shares beneficially owned by Mr. Ober were held
by the Trustee under the Employee Thrift Plan of the Corporation. The
Trust Agreement under such plan provides that plan participants have sole
voting power but no investment power with respect to such shares.
(d) Of the amounts shown as beneficially owned by the directors and executive
officers as a group, 33,112 shares were held by the Trustee under the
Employee Thrift Plan.
(e) The amounts shown include shares subject to option under the Corporation's
Stock Option Plan (see "Stock Option Plan" below) by Mr. Ober (31,440
shares), and directors and executive officers as a group (124,941 shares).
Mr. Ober and the officers with shares subject to option all disclaim
beneficial ownership of those shares.
(f) Calculated on the basis of 14,314,180 shares of Common Stock outstanding on
December 31, 1999, each director owned less than 1.0% of the Common Stock
outstanding. The directors and executive officers as a group owned 1.3% of
the Common Stock outstanding.
The nominees listed below are also nominees for election to the Board of
Directors of The Adams Express Company ("Adams"), the Corporation's largest
stockholder (see "Principal Stockholder" below), and at December 31, 1999,
beneficially owned the number of shares of Adams common stock shown next to
their respective names. Of these Adams shares, 20,420 were held by the Trustee
of the Adams' Employee Thrift Plan for Mr. Ober, as to which he had sole voting
and no investment power, and 46,104 shares are subject to option by Mr. Ober.
He disclaims beneficial ownership of these latter shares.
<TABLE>
<CAPTION>
NOMINEE ADAMS SHARES NOMINEE ADAMS SHARES
- ------------------------------ ------------- ------------------------------ -------------
<S> <C> <S> <C>
Enrique R. Arzac 5,214 W. Perry Neff 3,871
Daniel E. Emerson 9,019 Douglas G. Ober 66,577
Thomas H. Lenagh 1,515 Landon Peters 5,052
W. D. MacCallan 98,280 John J. Roberts 4,873
Susan C. Schwab 0
Robert J. M. Wilson 28,497
</TABLE>
4
<PAGE>
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Each director and officer of the Corporation who is subject to Section 16
of the Securities Exchange Act of 1934 is required to report to the Securities
and Exchange Commission by a specified date his or her beneficial ownership of
or transactions in the Corporation's securities. Based upon a review of filings
with the Securities and Exchange Commission and written representations that no
other reports were required, the Corporation has no reason to believe that such
directors and officers have not filed all requisite reports with the Securities
and Exchange Commission on a timely basis during 1999.
INFORMATION AS TO OTHER EXECUTIVE OFFICERS
Set forth below are the names, ages and positions with the Corporation and
Adams of all executive officers of the Corporation other than those who also
serve as directors. Executive officers serve as such until the election of
their successors.
Ms. Maureen A. Jones, 52, has served as Vice President and Treasurer of
the Corporation and Adams since January 1, 1998, and as Treasurer of the
Corporation and Adams since January 1, 1993.
Mr. Richard F. Koloski, 55, has served as President of the Corporation
since April 1, 1986, and as Executive Vice President of Adams since January 1,
1986.
Mr. Joseph M. Truta, 55, has served as Executive Vice President of the
Corporation since January 1, 1986, and as President of Adams since April 1,
1986.
Mr. Lawrence L. Hooper, Jr., 47, has served as Vice President of the
Corporation and Adams since March 30, 1999, and as Secretary and General
Counsel of the Corporation and Adams since April 1, 1997. Prior thereto, he was
a partner in Tydings & Rosenberg L.L.P., a Baltimore, Maryland law firm.
<TABLE>
<CAPTION>
SHARES OF
COMMON STOCK
SECURITY OWNERSHIP OF MANAGEMENT (A) BENEFICIALLY
NAME OWNED (B)(C)(D)(E)
- ---- ------------------
<S> <C>
Maureen A. Jones ................ 6,806
Richard F. Koloski .............. 60,849
Joseph M. Truta ................. 46,487
Lawrence L. Hooper, Jr. ......... 5,101
</TABLE>
- ----------
(a) As of December 31, 1999. Share ownership of directors and executive
officers as a group is shown in the table beginning on page 2 and
footnotes thereto.
(b) To the Corporation's knowledge, each officer had sole investment and voting
power with respect to the shares shown opposite his or her name above
other than shares referred to in footnotes (c) and (d) below.
(c) Of the amounts shown, the following shares beneficially owned by the
respective officer were held by the Trustee under the Employee Thrift Plan
of the Corporation: Ms. Jones (1,424 shares), Mr. Koloski (16,159 shares),
Mr. Truta (7,767 shares), and Mr. Hooper (385 shares). The Trust Agreement
under such plan provides that plan participants have sole voting power but
no investment power with respect to such shares.
(d) The amounts shown include shares subject to option under the Corporation's
Stock Option Plan (see "Stock Option Plan" below), by Ms. Jones (5,382
shares), Mr. Koloski (44,690 shares), Mr. Truta (38,720 shares), and Mr.
Hooper (4,709 shares).
(e) Calculated on the basis of 14,314,180 shares of Common Stock outstanding on
December 31, 1999, each of the officers listed above owned less than 1.0%
of the Common Stock outstanding.
5
<PAGE>
PRINCIPAL STOCKHOLDER
At December 31, 1999, only one person or group of persons was known by the
Corporation to own beneficially more than five percent of any class of the
Corporation's voting securities.
<TABLE>
<CAPTION>
AMOUNT AND
NATURE OF
NAME AND ADDRESS BENEFICIAL PERCENT OF
TITLE OF CLASS OF BENEFICIAL OWNER OWNERSHIP CLASS
- ----------------- --------------------------- ---------------- -----------
<S> <C> <C> <C>
Common Stock The Adams Express Company 1,210,085 shs. 8.5%
Seven St. Paul Street direct
Baltimore, Maryland 21202
</TABLE>
BOARD MEETINGS
The Board of Directors held twelve meetings during 1999, at which overall
attendance was approximately 93.9%. Each Director attended at least 75% of the
total of all (i) meetings of the Board and (ii) meetings of committees of the
Board on which he served in 1999, except for Mr. Roberts.
AUDIT COMMITTEE
Messrs. Comrie*, Emerson, Peters and Wilson, none of whom is an
"interested person," constitute the membership of the Board of Directors' Audit
Committee, which met twice during 1999. The Audit Committee (1) recommends to
the Board of Directors the firm of independent accountants to be engaged to
audit the books of account and other corporate records of the Corporation, (2)
reviews with the independent accountants the scope of their audit, with
particular emphasis on the areas to which either the Committee or the
independent accountants believe special attention should be directed, (3)
reviews the recommendations of the independent accountants regarding internal
controls and other matters, and (4) makes reports, whenever deemed advisable,
to the Board of Directors with respect to the internal controls and accounting
practices of the Corporation. The Audit Committee also reviews the audit and
non-audit fees of the independent accountants. The Audit Committee operates
under a written charter that was most recently amended in December 1999.
COMPENSATION COMMITTEE
Messrs. Arzac, Lenagh, MacCallan, and Neff constitute the membership of
the Board's Compensation Committee, which met three times during 1999. The
Compensation Committee reviews and recommends changes in the salaries of
directors, officers, and employees, and advises upon the compensation and stock
option plans in which the executive officers, officers, and employees of the
Corporation are eligible to participate.
EXECUTIVE COMMITTEE
Messrs. Arzac, Comrie*, MacCallan, Neff, Ober**, and Roberts constitute
the membership of the Board's Executive Committee, which met twice during 1999.
The Committee has the authority of the Board of Directors between meetings of
the Board except as limited by law, the Corporation's By-laws, or Board
resolution. The Executive Committee also performs the duties of a nominating
committee. It recommends to the full Board candidates for directorship. It is
the policy of the Executive Committee not to consider unsolicited nominations
for director.
- ----------
* Mr. Comrie resigned as a director as of December 31, 1999.
** Mr. Ober is an "interested person."
6
<PAGE>
RETIREMENT BENEFITS COMMITTEE
Messrs. Emerson, Lenagh, Neff, Roberts and Wilson are the director members
of the Retirement Benefits Committee of the Corporation and Adams, which
administers the Employees' Retirement Plans, Supplemental Retirement Plans and
the Employee Thrift Plans of the Corporation and Adams. This Committee met
three times during 1999.
BOARD OF DIRECTORS COMPENSATION
During 1999, each director who is not an interested person received an
annual retainer fee of $10,000 and a fee of $500 for each Board meeting
attended. All members of each Committee, except executive officers and/or
interested persons, receive an additional annual retainer fee of $1,500 for
each committee membership and a fee of $500 for each meeting attended; the
Chairman of each committee except for the Executive Committee receives an
additional fee of $500 for each Committee meeting attended. The total amount of
fees paid to "disinterested person" directors in 1999 was $373,000.
TRANSACTIONS WITH PRINCIPAL STOCKHOLDERS
The Corporation shares certain expenses with Adams, of which all the above
named nominees are also directors. These expenses are initially paid by Adams,
which is reimbursed by the Corporation either in proportion to the size of the
respective investment portfolios of the two companies or, where possible, on an
actual usage basis. In 1999 the Corporation's share of such expenses was
$391,126 for research, accounting services and other office services (including
proportionate salaries and other employee benefits), rent and related expenses,
and miscellaneous expenses such as office supplies, postage, subscriptions and
travel.
7
<PAGE>
REMUNERATION OF DIRECTORS AND OTHERS
The following table sets forth for each of the persons named below the
aggregate current remuneration received from the Corporation and Adams during
the fiscal year ended December 31, 1999 for services in all capacities:
<TABLE>
<CAPTION>
PENSION OR
RETIREMENT
BENEFITS
ACCRUED DURING ESTIMATED ANNUAL
AGGREGATE THE LAST FISCAL BENEFITS UPON
NAME OF PERSON, POSITION REMUNERATION (1)(2)(3)(4) YEAR (5) RETIREMENT
- --------------------- ---------------------- --------------------------- ----------------- -----------------
<S> <C> <C> <C> <C>
Douglas G. Ober Chairman of the Board
and Chief Executive
Officer (A) $794,000 -- $294,250
Richard F. Koloski President 379,000 -- 142,450
Joseph M. Truta Executive Vice
President 400,000 -- 154,000
Enrique R. Arzac Director (A)(C) 45,000 N/A N/A
Allan Comrie* Director (A)(B) 40,000 N/A N/A
Daniel E. Emerson Director (B)(D) 42,000 N/A N/A
Thomas H. Lenagh Director (C)(D) 43,000 N/A N/A
W. D. MacCallan Director (A)(C) 41,000 N/A N/A
W. Perry Neff Director (A)(C) 41,000 N/A N/A
Landon Peters Director (B)(D) 41,000 N/A N/A
John J. Roberts Director (A)(D) 36,000 N/A N/A
Robert J. M. Wilson Director (B)(D) 44,000 N/A N/A
</TABLE>
(A) Member of Executive Committee
(B) Member of Audit Committee
(C) Member of Compensation Committee
(D) Member of Retirement Benefits Committee
* Mr. Comrie resigned as a director as of December 31, 1999.
- ----------
(1) Of the amounts shown, direct salaries paid by the Corporation to Messrs.
Ober, Koloski and Truta were $71,500, $146,300, and $46,200, respectively.
Of the amounts shown, Adams paid non-deferred salaries to Mr. Ober
($245,702), Mr. Koloski ($59,742), and Mr. Truta ($156,000). Of the
amounts shown, $7,798 for Mr. Ober, $2,958 for Mr. Koloski, and $7,800 for
Mr. Truta, was deferred compensation under the Employee Thrift Plan paid
by Adams for the respective employee's account. Of the Corporation's
direct salaries, $2,202 for Mr. Ober, $7,042 for Mr. Koloski, and $2,200
for Mr. Truta, was deferred compensation under the Corporation's Employee
Thrift Plan. The non-employee Directors do not participate in either
Thrift Plan.
(2) The Corporation and Adams each offer an Employee Thrift Plan (see "Employee
Thrift Plan" below) to their respective employees under which
contributions are made to match the contributions made by eligible
employees, and each paid bonuses to certain officers. Of the amounts
shown, $103,183, $119,084, and $41,800 were bonuses and/or plan
contributions for Messrs. Ober, Koloski, and Truta, respectively. Adams
made contributions and/or paid bonuses of $365,817 for Mr. Ober, $50,916
for Mr. Koloski, and $148,200 for Mr. Truta, respectively. The
non-employee Directors do not receive bonuses from either company.
8
<PAGE>
(3) In addition, $77,122 for Mr. Ober and $42,132 for Mr. Koloski was the net
gain realized by them upon the exercise of stock appreciation rights
during 1999 granted under the Corporation's Stock Option Plan (see "Stock
Option Plan" below).
(4) Of the amounts shown for non-employee Directors, exactly one-half was paid
by Adams.
(5) The Corporation and Adams each have a noncontributory Employees' Retirement
Plan. No contributions were made by the Corporation or Adams to their
respective plans in 1999.
STOCK OPTION PLAN
On December 12, 1985, the Corporation's Board of Directors adopted a Stock
Option Plan (the "Plan"), which was approved by the stockholders at the March
26, 1986 Annual Meeting of Stockholders and amended at the March 29, 1994
Annual Meeting of Stockholders. The Plan provides for the grant to "key
employees" (as defined in the Plan) of options to purchase an aggregate maximum
of 815,000 shares of Common Stock of the Corporation, together with related
stock appreciation rights, of which (i) 335,000 shares may be made subject to
options granted between December 12, 1985 and December 11, 1995, and (ii)
480,000 shares may be made subject to options granted between December 9, 1993
and December 8, 2003. All options granted or to be granted under the Plan
currently will be treated as non-qualified stock options under the Internal
Revenue Code. The Plan is administered by the Compensation Committee of the
Board of Directors, which consists of four members of the Board, none of whom
is eligible to receive grants under the Plan. The grant of options is at the
discretion of the Compensation Committee.
The Plan provides that, among other things, (a) the option price per share
shall not be less than the fair market value of the Common Stock at the date of
grant, except that the option price per share will be reduced after grant of
the option to reflect capital gains distributions to the Corporation's
stockholders, provided that no such reduction shall be made that will reduce
the option price below 25% of the original option price; (b) an option will not
become exercisable until the optionee shall have remained in the employ of the
Corporation for at least one year after the date of grant and may be exercised
for 10 years unless an earlier expiration date is stated in the option; and (c)
no option or stock appreciation right shall be granted after December 8, 2003.
The Plan permits the grant of stock appreciation rights in conjunction
with the grant of an option, either at the time of the option grant or
thereafter during its term and in respect of all or part of such option. Stock
appreciation rights permit an optionee to request to receive (a) shares of
Common Stock of the Corporation with a fair market value, at the time of
exercise, equal to the amount by which the fair market value of all shares
subject to the option in respect of which such stock appreciation right was
granted exceeds the exercise price of such option, (b) in lieu of such shares,
the fair market value thereof in cash, or (c) a combination of shares and cash.
Stock appreciation rights are exercisable beginning no earlier than two years
after the date of grant and extend over the period during which the related
option is exercisable. To the extent a stock appreciation right is exercised in
whole or in part, the option in respect of which such stock appreciation right
was granted shall terminate and cease to be exercisable.
No disposition of shares of Common Stock acquired as the result of the
exercise of an option or stock appreciation right may be made within the later
of two years of the date of grant of the option and within one year of the
acquisition of such shares.
9
<PAGE>
EMPLOYEE THRIFT PLAN
Employees of the Corporation who have completed six months of service may
elect to have 2% to 6% of their base salary deferred as a contribution to a
thrift plan instead of being paid to them currently (see table set forth on
page 8 regarding 1999 contributions for the officers and directors identified
therein). The Corporation (subject to certain limitations) contributes for each
employee out of net investment income an amount equal to 200% of each
employee's contribution or to the maximum permitted by law. Employees may also
contribute an additional 10% of base salary to the thrift plan, but these
post-tax contributions are not matched by the Corporation. All employee
contributions are credited to the employee's individual account. Employees may
elect that their salary deferral and other contributions be invested in a money
market fund, an intermediate bond fund, Common Stock of the Corporation or of
Adams, or a combination thereof. The Corporation's contributions are invested
entirely in its Common Stock. An employee's interest in amounts derived from
the Company's contributions becomes non-forfeitable upon completion of 36
months of service or upon death or retirement. Payment of amounts not withdrawn
or forfeited under the thrift plan may be made upon retirement or other
termination of employment in a single distribution, in ten equal installments,
or in an annuity.
EMPLOYEES' RETIREMENT PLAN
The respective employees of the Corporation and Adams with one or more
years of service participate in similar retirement plans pursuant to which
contributions are made solely by the respective employers on behalf of, and
benefits are provided for, employees meeting certain age and service
requirements. The plans provide for the payment of benefits in the event of an
employee's retirement at age 62 or older. Upon such retirement, the amount of
the retirement benefit is 2% of an employee's final thirty-six months average
annual salary, including bonuses, multiplied by years of service. Retirement
benefits cannot exceed 55% of final thirty-six months' average annual salary
including bonuses. The criteria for calculation of retirement benefits under
Adams' plan are the same. Benefits are payable in several alternative methods,
each of which must be the actuarial equivalent of a pension payable for the
life of the employee only. Retirement benefits (subject to any applicable
reduction) are also payable in the event of an employee's early or deferred
retirement, disability, or death. Contributions are made to a trust to fund
these benefits.
On March 10, 1988, the Board of Directors of each of the Corporation and
Adams unanimously approved a supplemental retirement benefits plan (together,
the "Supplemental Plans") for employees of the Corporation or Adams, as the
case may be. On June 11, 1998, the Supplemental Plans were amended and restated
as of January 1, 1998. The purpose of each of the Supplemental Plans is to
provide deferred compensation in excess of benefit limitations imposed by the
Internal Revenue Code on tax-qualified defined benefit plans, including the
retirement plans of the Corporation and Adams described above. In accordance
with such limitations, the annual benefit payable under each retirement plan
may not exceed the lesser of $135,000 for 2000 and the employee's average total
compensation paid during the three highest-paid consecutive calendar years of
employment. The $135,000 limit will be adjusted by the Secretary of the
Treasury to reflect cost-of-living increases.
The Supplemental Plans authorize the Corporation or Adams, as the case may
be, to pay annual retirement benefits to beneficiaries in an amount equal to
the difference between the maximum benefits payable under such retirement plan
and the benefits that would otherwise be payable but for the Internal Revenue
Code's limitations on annual retirement benefits. All amounts payable under the
Supplemental Plans will be paid from the general funds of the responsible
company as benefits become due.
10
<PAGE>
The Corporation and Adams have established a funding vehicle using life
insurance policies owned by the Companies for their respective Supplemental
Plans. Payment of benefits under the Supplemental Plans will be made
concurrently with and in the same form as payment of benefits under the related
retirement plan. During 1999, the Corporation and Adams made payments of
$15,467 and $18,844 under their respective Supplemental Plans.
BROKERAGE COMMISSIONS
During the past fiscal year, the Corporation paid brokerage commissions in
the amount of $189,214 on the purchase and sale of portfolio securities traded
on the New York Stock Exchange, substantially all of which were paid to brokers
providing research and other investment services to the Corporation. The
average per share commission rate paid by the Corporation was $0.0601. No
commissions were paid to an affiliated broker.
PORTFOLIO TURNOVER
The portfolio turnover rate (purchases or sales, whichever is lower, as a
percentage of weighted average portfolio value) for the past three years has
been as follows:
<TABLE>
<CAPTION>
1999 1998 1997
- ------------ ----------- ---------------
<S> <C> <C>
11.89% 12.70% 13.09%
</TABLE>
EXPENSE RATIO
The ratio of expenses to the average net assets of the Corporation for the
past three years has been as follows:
<TABLE>
<CAPTION>
1999 1998 1997
- ----------- ---------- --------------
<S> <C> <C>
0.43% 0.31% 0.47%
</TABLE>
(B) RATIFICATION OF SELECTION OF INDEPENDENT ACCOUNTANTS
The Investment Company Act of 1940 (the "Act") requires, in effect, that
the Corporation's independent accountants be selected by a majority of those
members of the Board of Directors who are not "interested persons" (as defined
by the Act) of the Corporation; that such selection be submitted for
ratification or rejection at the annual meeting of stockholders; and that the
employment of such independent accountants be conditioned on the right of the
Corporation, by vote of the holders of a majority of its outstanding voting
securities, to terminate such employment at any time without penalty. In
accordance with such provisions, PricewaterhouseCoopers LLP, 250 W. Pratt
Street, Baltimore, Maryland, independent accountants, which firm was the
Corporation's principal auditor during the year 1999, has been selected as
independent accountants of the Corporation to audit the books and accounts of
the Corporation for or during the year ending December 31, 2000, by a majority
of those members of the Board of Directors who were not "interested persons" of
the Corporation, voting in person, and their selection is submitted to the
stockholders for ratification by the affirmative vote of a majority of all
votes cast at the meeting. Representatives of PricewaterhouseCoopers LLP are
expected to be present at the meeting to make a statement if they desire to do
so and to respond to appropriate questions. PricewaterhouseCoopers LLP does not
have any direct financial or any material indirect financial interest in the
Corporation.
11
<PAGE>
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS RATIFICATION OF THE
SELECTION OF PRICEWATERHOUSECOOPERS LLP.
(C) APPROVAL OF A PROPOSED AMENDMENT TO ARTICLE SIXTH OF THE ARTICLES OF
INCORPORATION TO INCREASE AUTHORIZED COMMON STOCK
It is proposed that the Articles of Incorporation be amended to increase
the number of authorized shares of Common Stock from 25,000,000 shares to
50,000,000 shares. This increase would be effected by amending the first
paragraph of Article SIXTH so that it will read "The total number of shares of
stock which the Corporation shall have authority to issue is 55,000,000 shares
with an aggregate par value of $50,000,000, divided into two classes consisting
of (a) 50,000,000 shares of Common Stock, par value $1.00 per share, and (b)
5,000,000 shares of Preferred Stock, without par value." Of the 25,000,000
shares of Common Stock currently authorized, as of December 31, 1999, 14,314,180
shares were outstanding, and 336,130 shares were reserved for issuance under the
Company's stock option plan. The additional shares of Common Stock that would be
authorized by the proposed amendment would have the same rights and privileges
and otherwise be identical to the shares of Common Stock currently authorized
and outstanding. The proposed amendment to the Articles of Incorporation also
deletes references to a class of preferred stock known as Convertible Preferred
Stock, par value $25.00 per share. All issued and outstanding shares of this
class of convertible preferred stock were redeemed by the Corporation and
cancelled a number of years ago and the Corporation has no authority to reissue
shares of this class. The proposal to be adopted will require the affirmative
vote of a majority of all the votes entitled to be cast thereon, being a
majority of the issued and outstanding shares of Common Stock. If the proposal
is adopted, the Corporation shall cause Articles of Amendment to the Articles of
Incorporation, substantially in the form of Exhibit A attached hereto, to be
filed with the State Department of Assessments and Taxation of the State of
Maryland. If the proposal is not adopted, it may be resubmitted to the
stockholders at future meetings.
The Board of Directors recommends the adoption of this proposal. If it is
adopted, additional shares of authorized and unissued Common Stock will be
provided which can be issued, without further stockholder approval, by the
Board of Directors, for the payment of dividends and capital gain distributions
to the holders of the Common Stock or, subject to the requirements of the
Investment Company Act of 1940, for such other proper corporate purposes as may
be deemed desirable by the Board of Directors, including for use in connection
with the issuance of any future class of convertible equity security of the
Corporation, possible acquisitions, future stock splits, or the Corporation's
stock option plan. The Board of Directors does not have any present plans to
issue additional shares of Common Stock other than for payment of dividends and
capital gain distributions, and if required, pursuant to the stock option plan.
Holders of the Corporation's shares have no preemptive rights and, as a result,
existing stockholders would not have any preferential right to purchase any of
the additional shares of Common Stock if and when issued.
Although the Board of Directors presently has no plans to do so, the
additional shares of Common Stock could, subject to the applicable laws and
rules, be sold in a public offering. If such an offering occurred, there could,
depending upon a variety of factors, including the rate of return achieved on
the investment of the proceeds of any such offering, be a dilution of the net
income per share of the outstanding Common Stock. Such an offering would also
involve a dilution in the voting rights of the outstanding Common Stock.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR THE ADOPTION OF
THE PROPOSED AMENDMENT.
12
<PAGE>
(D) APPROVAL OF AN AMENDMENT OF INVESTMENT POLICY TO CHANGE THE
CORPORATION'S SUBCLASSIFICATION FROM A DIVERSIFIED INVESTMENT COMPANY TO A
NON-DIVERSIFIED INVESTMENT COMPANY
The Corporation is registered as a diversified investment company under
Section 5 (b) (1) of the Investment Company Act of 1940 ("1940 Act"). In
addition, one of the Corporation's investment policies is that it will restrict
its investments in companies to the levels required for it to qualify as a
diversified company. In this regard, the Corporation currently is subject to
the following investment restriction:
"(2) PERCENTAGES OF ASSETS OR VOTING SECURITIES OF ANY ONE ISSUER WHICH MAY
BE ACQUIRED. The Corporation's policy is to invest such percentage of its
assets in the voting and non-voting securities of any one issuer as its
directors may from time to time approve, provided that the Corporation will
not make any investment if as a result thereof less than 75% of the value of
the Corporation's assets would be invested in cash, cash items, government
securities, securities of other investment companies, and other securities,
which for the purpose of this calculation are limited in respect of any one
issuer to not more than 5% of the value of the Corporation's total assets
and to not more than 10% of such issuer's outstanding voting securities."
As its name suggests, the Corporation is a sector fund that specializes in
investing in the stocks of oil and gas and natural resources companies, and is
invested primarily in energy companies. It is a fundamental policy of the
Corporation that it invest at least 80% of its assets in the securities of
companies "engaged in the petroleum or natural resources industries or
industries connected with, serving and/or supplying the petroleum or natural
resources industries, or in interests in petroleum or natural resources
properties".
There has been a great deal of consolidation in the oil and gas industry,
particularly among large international oil companies that have long been the
largest holdings in the portfolio. At the end of last year, the Corporation
held almost 30% of its portfolio in international oil companies, and the
percentage in 1998 was virtually identical. During 1999, mergers were announced
or completed between, among others, BP and Amoco, and Exxon and Mobil. As a
result, the holdings in these combined companies, unless substantially reduced,
would cause the Corporation to hold more than 25% of its assets in positions
constituting 5% or more of the Corporation's assets. Other mergers and
consolidations have been announced, and the apparent economics of the petroleum
industry suggest that still others may follow. In order for the Corporation to
remain a diversified investment company, and to continue its investment
program, the Corporation must reduce the number of shares that it holds in
important companies that it would prefer to retain. These sales have not been
based upon the investment merits of the companies involved.
To address these changing market conditions and to give the Corporation
the increased flexibility to have the number of companies in which it holds 5%
or more of its assets exceed five, the Board recommends that the Corporation
change its subclassification under the 1940 Act to that of a non-diversified
company and amend the investment policy quoted above to read in its entirety as
follows (which policy as amended, is a non-fundamental investment policy of the
Corporation):
(2) PERCENTAGES OF ASSETS OR VOTING SECURITIES OF ANY ONE ISSUER WHICH MAY
BE ACQUIRED. The Corporation's policy is to invest such percentage of its
assets in the voting and non-voting securities of any one issuer as its
directors may from time to time approve, provided that the Corporation will
not make any investment if as a result thereof less than 75% of the value of
the Corporation's assets
13
<PAGE>
would be invested in cash, cash items, government securities, securities of
other investment companies, and other securities, which for the purpose of
this calculation are limited in respect of any one issuer to not more than
10% of such issuer's outstanding voting securities.
This proposal would give the Corporation greater investment flexibility by
permitting it to acquire 5% or greater positions in the securities of
individual companies that cumulatively may exceed 25% of the Corporation's
total assets. In particular, it would increase management's ability, where
appropriate, to over-weight positions that represent significant percentages
of the energy sector. The Corporation believes that this increased
flexibility may provide opportunities to enhance the Corporation's
performance. At the same time, investing a larger percentage of the
Corporation's assets in companies where the Corporation's holdings represent
5% or more of its assets increases the Corporation's exposure to investment
and other risks associated with those companies' financial condition and
business operations, including the risk of default on debt securities. The
Corporation will use the increased flexibility to invest more than 25% of
its total assets in 5% or greater holdings of individual companies'
securities only when it believes the securities' potential return justifies
accepting the risks associated with the higher levels of investment.
Approval of this proposal will not affect the Corporation's compliance
with the requirements of the Internal Revenue Code that enable it to qualify
as a "regulated investment company" for tax purposes. As a non-diversified
investment company, those requirements would permit the Corporation to
invest up to 50% of its assets in company holdings of 5% or greater. Also,
approval of this proposal will not affect the limitation in the
Corporation's investment policies that the Corporation's investments in
issuers that are individually more than 10% of the issuer's outstanding
voting securities will not in the aggregate exceed 25% of the assets of the
Corporation. A change in the Corporation's subclassification also will not
affect the tax status of the Corporation and should not otherwise impact
upon its operations.
As a non-diversified investment company, the Corporation will be able to
invest a larger portion of its assets in securities of some companies. To
the extent it does so, the Corporation will have proportionally greater
exposure to fluctuations in the value of those companies' securities and to
any risks associated with the financial condition of those companies.
If this proposal is approved, future amendments to the Corporation's
fundamental investment policies will continue to require stockholder
approval as required by the 1940 Act.
The Board has concluded that the proposed change in the Corporation's
investment policies to change its subclassification from a diversified
company to a non-diversified company will benefit the Corporation and its
stockholders.
To become effective, the proposal must be approved by the affirmative vote
of the lesser of (i) 67% of all the outstanding shares of Common Stock
present or represented at the meeting (assuming that more than 50% of the
outstanding shares of Common Stock are present or represented at the
meeting) or (ii) a majority of all of the outstanding shares of Common
Stock.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR THE ADOPTION OF
THE PROPOSED CHANGE IN INVESTMENT POLICY.
14
<PAGE>
(E) OTHER MATTERS AND ANNUAL REPORT
As of the date of this proxy statement, management knows of no other
business that will come before the meeting. Should other business be properly
brought up, it is intended that proxies in the accompanying form will be voted
thereon in accordance with the judgment of the person or persons voting such
proxies.
The Annual Report of the Corporation for the year ended December 31, 1999,
including financial statements, has been mailed to all stockholders entitled to
notice of and to vote at the annual meeting to be held on March 28, 2000. If
you did not receive a copy, you may request one by telephoning Lawrence L.
Hooper, Jr., Vice President, Secretary and General Counsel, at (800) 638-2479
or by sending Mr. Hooper an e-mail message at [email protected].
The Corporation has retained Corporate Investor Communications, Inc.
("CIC") to assist in the solicitation of proxies. The Corporation will pay CIC
a fee for its services not to exceed $5,000 and will reimburse CIC for its
expenses, which the Corporation estimates will not exceed $2,000.
STOCKHOLDER PROPOSALS FOR 2001 ANNUAL MEETING
Stockholder proposals for inclusion in the proxy statement and form of
proxy relating to the 2001 Annual Meeting must be received at the office of the
Corporation, Seven St. Paul Street, Baltimore, MD 21202, no later than October
17, 2000.
In addition, pursuant to the Corporation's By-laws, stockholder proposals
for consideration at the 2001 Annual Meeting which are not to be included in
the Corporation's proxy statement and form of proxy must be received at the
office of the Corporation at the address listed in the preceding paragraph no
later than January 27, 2001 in order to be eligible for presentation at the
2001 Annual Meeting. Should the Corporation determine to allow a stockholder
proposal that is received by the Corporation after January 27, 2001 to be
presented at the 2001 Annual Meeting nevertheless, the Corporation will have
discretionary voting authority with respect to such stockholder proposal.
15
<PAGE>
EXHIBIT A
ARTICLES OF AMENDMENT
TO
ARTICLES OF INCORPORATION
OF
PETROLEUM & RESOURCES CORPORATION
PETROLEUM & RESOURCES CORPORATION, a Maryland corporation having its
principal office in Baltimore City, Maryland (hereinafter called the
"Corporation"), hereby certifies to the State Department of Assessments and
Taxation of Maryland that:
FIRST: The Articles of Incorporation of the Corporation are hereby amended
by striking out the first paragraph of Article SIXTH thereof and inserting in
lieu thereof the following:
"SIXTH: The total number of shares of stock which the Corporation shall
have authority to issue is 55,000,000 shares with an aggregate par value
of $50,000,000, divided into two classes consisting of (a) 50,000,000
shares of Common Stock, par value $1.00 per share, and (b) 5,000,000 shares
of Preferred Stock, without par value."
SECOND: The Board of Directors of the Corporation at a meeting duly
convened and held on January 13, 2000, adopted a resolution in which was set
forth the foregoing amendment of the Articles of Incorporation, declaring that
said amendment was advisable and directing that it be submitted for action
thereon at the Annual Meeting of Stockholders of the Corporation to be held on
March 28, 2000.
THIRD: Notice setting forth the said amendment of the Articles of
Incorporation and stating that a purpose of the Annual Meeting of Stockholders
would be to take action thereon was given, as required by law, to all
stockholders entitled to vote thereon.
FOURTH: The amendment of the Articles of Incorporation of the Corporation
as hereinabove set forth was approved by the stockholders of the Corporation at
said meeting by the affirmative vote of a majority of all the votes entitled to
be cast thereon, being a majority of the issued and outstanding shares of
Common Stock.
FIFTH: The amendment of the Articles of Incorporation as hereinabove set
forth has been duly advised by the Board of Directors and approved by the
stockholders of the Corporation.
SIXTH: (a) The total number of shares of all classes of stock of the
Corporation heretofore authorized by Article SIXTH of the Articles of
Incorporation of the Corporation is 31,000,000 shares, with an aggregate par
value of $50,000,000, divided into (i) 25,000,000 shares of Common Stock, par
value $1.00 per share, (ii) 5,000,000 shares of Preferred Stock, without par
value, and (iii) 1,000,000 shares of Convertible Preferred Stock, par value
$25.00 per share; (b) the total number of shares of all classes of stock of the
Corporation, as increased by the foregoing amendment to said Article SIXTH, is
55,000,000 shares, with an aggregate par value of $50,000,000, divided into (i)
50,000,000 shares of Common Stock, par value $1.00 per share, and (ii)
5,000,000 shares of Preferred Stock, without par value; and (c) a description,
as amended, of each class of stock of the rights, voting powers, restrictions,
limitations as to dividends, qualifications, and terms and conditions of
redemption is set forth in the Articles of Incorporation of the Corporation, as
amended hereby.
16
<PAGE>
IN WITNESS WHEREOF, Petroleum & Resources Corporation has caused these
presents to be signed in its name and on its behalf by its President or one of
its Vice Presidents and its corporate seal to be hereunto affixed and attested
by its Secretary, and the said officers of the Corporation further acknowledged
said instrument to be the corporate act of the Corporation and stated under the
penalties of perjury that to the best of their knowledge, information and
belief the matters and facts therein set forth with respect to the approval
thereof are true in all material respects on March , 2000.
ATTEST: PETROLEUM & RESOURCES CORPORATION
By: --------------------------------- By: -----------------------------------
Name: Name:
Title: Title:
17
<PAGE>
PETROLEUM & RESOURCES CORPORATION - PROXY FOR 2000 ANNUAL MEETING
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints W. D. MacCALLAN, W. PERRY NEFF and ROBERT J. M.
WILSON, the proxies, and each of them (with power to act without the others and
with power of substitution) the proxy of the undersigned, for and in the name of
the undersigned, to vote at the Annual Meeting of Stockholders of Petroleum &
Resources Corporation to be held at The Colony Palm Beach, 115 Hammon Avenue,
Palm Beach, Florida 33480, on the 28th day of March, 2000 at 10:00 a.m., and at
any adjournment thereof, the shares of stock which the undersigned would be
entitled to vote if personally present.
The undersigned hereby ratifying all action of said proxies, or any of them, or
their or his substitutes or substitute by virtue hereof; and hereby revoking any
authorization to vote such shares heretofore given by the undersigned to anyone.
The undersigned hereby acknowledges receipt of the Notice of Annual Meeting of
Stockholders dated February 14, 2000, and the Proxy Statement furnished
therewith.
IF THE UNDERSIGNED FAILS TO SPECIFY HEREIN HOW SUCH SHARES ARE TO BE VOTED ON
SAID PROPOSALS (A), (B), (C), AND (D), THEY SHALL BE VOTED "FOR" SAID PROPOSALS.
(over)
PETROLEUM & RESOURCES CORPORATION
P.O. BOX 11130
NEW YORK, N.Y. 10203-0130
<PAGE>
(a) ELECTION OF DIRECTORS
FOR all nominees [ ]
listed below
WITHHOLD AUTHORITY to vote [ ]
for all nominees listed below
*EXCEPTIONS [ ]
Nominees: Enrique R. Arzac, Daniel E. Emerson, Thomas H. Lenagh,
W. D. MacCallan, W. Perry Neff, Douglas G. Ober, Landon Peters,
John J. Roberts, Susan C. Schwab, Robert J. M. Wilson
(INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, MARK
THE "EXCEPTIONS" BOX AND WRITE THAT NOMINEE'S NAME IN THE SPACE PROVIDED BELOW.)
*Exceptions_____________________________________________________________________
(b) THE SELECTION OF PricewaterhouseCoopers LLP as independent public
accountants.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
(c) THE APPROVAL OF AN AMENDMENT TO the Articles of Incorporation increasing the
number of authorized shares of Common Stock of the Corporation from
25,000,000 shares to 50,000,000 shares.
FOR [X] AGAINST [X] ABSTAIN [X]
(d) AMEND THE CORPORATION'S INVESTMENT POLICY TO change its subclassification
from a diversified investment company to a non-diversified investment
company.
FOR [X] AGAINST [X] ABSTAIN [X]
(e) In their discretion, the Proxies are authorized to vote upon all other
business that may properly come before the Meeting with all the powers the
undersigned would possess if personally present.
THE BOARD OF DIRECTORS RECOMMENDS VOTES FOR: PROPOSALS (A), (B), (C) AND (D).
Change of Address or [ ]
Comments Mark Here
NOTE: The signature(s) should correspond with the
name of the stockholder(s) as it appears
hereon.
Dated: ________________________________,2000
Signature __________________________________
Joint Tenant _______________________________
COMMON
SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED ENVELOPE.
VOTES MUST BE INDICATED [X]
(X) IN BLACK OR BLUE INK.
