<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934
(Mark One)
[ ] Filed by the Registrant
[X] Filed by a Party Other than the Registrant
Check the appropriate box:
[X] Preliminary Proxy Statement
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
TRI-VALLEY CORPORATION
(Exact Name as Specified in its Charter)
THE TRI-VALLEY COMMITTEE FOR NEW MANAGEMENT
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[ ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(l), 14a-6(j)(2)
or Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange
Act Rule 14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
Title of each class of securities to which transaction applies:
Aggregate number of securities to which transaction applies:
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):
Proposed maximum aggregate value of transaction:
Total fee paid:
[X] 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.
Amount previously paid:
Form, Schedule Or Registration Statement No.:
Filing Party:
Date filed:
<PAGE>
PRELIMINARY PROXY MATERIAL
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION
ON MAY 30, 1996
PROXY STATEMENT
OF
THE TRI-VALLEY COMMITTEE FOR NEW MANAGEMENT
2 NORTH CASCADE AVENUE
SUITE 1100
COLORADO SPRINGS, COLORADO 80903
SOLICITATION OF PROXIES FOR
MEETING OF STOCKHOLDERS
OF
TRI-VALLEY CORPORATION
JUNE 1, 1996
To Fellow Stockholders of the Company:
The enclosed proxy material relating to Tri-Valley Corporation
("Tri-Valley" or the "Company") from the Tri-Valley Committee for New
Management (the "Committee") is sent to you as the direct or beneficial owner
of common stock of the Company. The Committee includes stockholders of the
Company who are dissatisfied with the actions and nonperformance of the Board
of Directors culminating in the recent bankruptcy filing of the Company. The
Committee was formed to replace the incumbent directors of the Company with
the Committee's nominees named in this Proxy Statement (the "Nominees").
As a result of the Committee's efforts, on May 3, 1996, the judge
in the Company's federal bankruptcy case ordered the Company to hold a
meeting of stockholders of the Company no later than July 31, 1996. BECAUSE
OF THE COMMITTEE'S ACTIONS TAKEN ON YOUR BEHALF, THIS WILL BE THE FIRST
STOCKHOLDERS MEETING HELD BY THE COMPANY IN ALMOST FOUR YEARS, AND GIVES
STOCKHOLDERS AN OPPORTUNITY TO EXPRESS THEIR DISSATISFACTION WITH THE CURRENT
MANAGEMENT OF THE COMPANY BY NOT RE-ELECTING THE INCUMBENT BOARD.
To be ensured to vote at the stockholders meeting with the
Committee, you need to execute the enclosed green proxy card and return it to
the Committee. By returning the enclosed proxy, stockholders will be able to
vote for the Committee's nominees and to vote on all matters that may arise
at the stockholders meeting.
The Committee urges you to ignore any requests of the Company's
current Board of Directors to execute proxies on behalf of the current Board
or to revoke or not to sign the Proxy requested by the requested Proxy.
Instead, the Committee urges you to sign and return the enclosed form of
Proxy.
<PAGE>
This Proxy Statement, together with the enclosed form of Proxy
(printed on green paper), is first being mailed or distributed to
stockholders of the Company on or about June 1, 1996.
THE STOCKHOLDERS COMMITTEE
The Committee is comprised of eight persons, namely, Alfred
Ainsworth III, Jay T. Dalton, Eugene R. Hering, Marc R. Herman, Bernard L.
Larsen, Lorrie T. Olivier, Todd A. Oseth and James J. Williams, as
representative of the Patexco Employees' Pension Trust. All of the foregoing
members are collectively referred to in this Proxy Statement as the
"Committee members." As of May 13, 1996, the Committee members beneficially
owned an aggregate of 373,990 shares of the Company's common stock,
representing approximately 5.1% percent of the Company's shares currently
outstanding.
INTEREST OF CERTAIN PERSONS IN
MATTERS TO BE ACTED UPON
Three of the Committee members, Messrs. Ainsworth, Oseth and
Olivier, are Committee Nominees. Additional information about the Committee
members, the Committee Nominees and certain other persons is set forth in
Annex A which accompanies this Proxy Statement. See also further information
concerning the Committee's Nominees set forth in the discussion below under
the caption "Election of the Committee's Nominees."
BACKGROUND PRECEDING PROXY SOLICITATION
Current management took control of the Company over fifteen years
ago. During that time, stockholders of the Company have confronted serious
problems, including a declining stock price, no dividends, unauthorized
corporate transactions, diversion of funds, and self-dealing. SEE "Summary
of Management Problems Prior to Bankruptcy" below. Perhaps the most
significant indicator of poor management, however, was the Company's
declaration of bankruptcy. Without any general communication with its
stockholders regarding the deterioration of the Company or an exploration of
the Company's alternatives, the present Board of Directors and management
filed on January 30, 1996 for protection under Chapter 11 of the United
States Bankruptcy Act.
Because of current management's poor performance, the Committee was
formed to replace the incumbent directors of the Company. To this end, the
Committee conducted a solicitation of consents from stockholders of the
Company in March and April 1996 to remove the current Board of Directors and
replace them with the Committee's nominees. While sufficient consents were
not obtained by the April 29, 1996 deadline to effect the proposed change in
management using the consent process, the Committee did obtain consents from
the holders of approximately 47% of the outstanding common stock. In
addition, the Committee,
-2-
<PAGE>
through intervention in the Company's bankruptcy proceeding, was able to help
convince the bankruptcy court judge to order the Company to hold a meeting of
stockholders for the election of directors. By a motion submitted by the
United States Trustee overseeing the Company's bankruptcy, the Company was
ordered to hold a meeting of stockholders no later than July 31, 1996. This
meeting will be the first meeting of stockholders, and the first time
stockholders will be given the chance to vote for the Company's Board of
Directors at a regular meeting, in almost four years. THE COMMITTEE URGES
YOU TO TAKE ADVANTAGE OF THIS OPPORTUNITY TO SHOW CURRENT MANAGEMENT WHO THEY
ARE WORKING FOR BY GRANTING THE ENCLOSED PROXY TO THE COMMITTEE FOR THE
ELECTION OF ITS NOMINEES TO THE COMPANY'S BOARD OF DIRECTORS.
SUMMARY OF MANAGEMENT PROBLEMS PRIOR TO BANKRUPTCY
In the opinion of the Committee, the chief reason giving rise to
the Company's bankruptcy is that the Company has been managed poorly. For
example, at the end of 1995, the Company's outstanding debt had ballooned to
more than $900,000. The Committee believes that the incurrence of this debt
is a primary reason the Company had to file for bankruptcy protection.
In addition, despite the expenditure by the Company, according to
filings made with the United States Bankruptcy Court, of over $l,700,000 on
mineral lease acquisitions and gold exploration since 1986, it is the
Committee's understanding, based on statements made by the former Secretary
and Treasurer of the Company, that resulting revenues for the Company during
this time have totaled only approximately one-third of this amount.
Additional filings in the United States Bankruptcy Court state that, during
the last year, the Company's claims to more than half of its prospect acreage
lapsed simply due to its inability to stay current with its payments on the
claims. The Committee believes that, in its current financial condition, the
Company cannot afford to hold onto its claims, much less mine any gold.
Furthermore, United States Bankruptcy Court filings also state that the
Company is delinquent in the payment of real estate property taxes (including
applicable state oil and gas production taxes) of at least $15,000 for
certain of the Company's natural gas producing properties known as the
Martins-Severin #2, #3 and #5 wells in Contra Costa County, California.
Natural gas producing properties currently represent the Company's sole
source of operating revenues. These taxes could become a lien against the
properties, reducing their value and posing the ultimate risk that taxing
authorities could foreclose on the properties. It has become apparent that
current management is not capable of exploiting its valuable properties. The
Committee believes that these circumstances must change, but will not without
a new Board of Directors or new management.
The Committee believes current management also has demonstrated a
serious disregard of its duties owed to stockholders as a publicly-held
company. The rules of the Securities and Exchange Commission ("SEC") require
that Tri-Valley submit annual financial and operating information on a Form
10-K to the SEC and to the stockholders by way of an annual report. THE
COMPANY HAS FAILED TO FILE ITS
-3-
<PAGE>
FORM 10-K WITH THE SEC AND HAS NOT SENT ANNUAL REPORTS TO STOCKHOLDERS FOR AT
LEAST THE PAST TWO YEARS. The Committee believes that one possibility giving
rise to this failure is that current management was deliberately attempting
to withhold material information to its stockholders regarding the state of
the Company. Moreover, the bylaws require that the Company hold a
stockholder's meeting each year in September for the purpose of electing
directors and conducting other business. CURRENT MANAGEMENT HAS FAILED TO
HOLD THESE REQUIRED MEETINGS FOR OVER FOUR YEARS.
In addition to the foregoing, the Committee faults the record of
the present Board of Directors based, in part, on the following issues:
1. Lack of oversight with respect to management that permitted
unauthorized transactions and diversion of funds. For example, according to
a declaration filed with the United States Bankruptcy Court by the former
Secretary and Treasurer of the Company, Mr. F. Lynn Blystone, President and
Chief Executive Officer of the Company, obtained a secured loan for the
Company in early May 1995 for $620,000, even though the Board of Directors
had authorized a loan for only $500,000. The same declaration also discloses
that Mr. Blystone directed the former Treasurer of the Company to divert
$45,000 of funds from gas well working interest partners to make lease
payments in respect of certain gold claims owned by the Company, repaid the
working interest partners with a loan from a stockholder of the Company, and
then repaid the loan to the stockholder with other gas well working interest
partner funds.
2. Self-dealing on the part of the Company's President and Chief
Executive Officer. According to Mr. Blystone's own testimony at a hearing in
the Company's bankruptcy court case, Mr. Blystone retained royalty interests
for himself in low-risk gas field development investments made by the
Company. In addition, Mr. Blystone testified that he had made at least one
personal loan to the Company at an interest rate higher than that available
from other sources at the time the loan was made. Mr. Blystone further
testified that he and an associate purchased real estate in Alaska and,
within a short period thereafter, re-sold the real estate to the Company.
Finally, according to the former Secretary and Treasurer of the Company, Mr.
Blystone is paying himself interest on accrued salary at a rate of 18% per
annum.
3. The Committee is informed that, prior to filing for
bankruptcy, the Board of Directors, for no stated reason, refused to
negotiate an out-of-court settlement with the Company's largest creditor,
despite the potential benefit to the stockholders of a negotiated work-out
without filing bankruptcy. The Committee believes that an out-of-court
settlement could have significantly benefited stockholders because the
Company's largest creditor is secured by the Company's oil and gas producing
properties, will likely be entitled to such properties as part of plan of
reorganization, and offered to negotiate a settlement with the Company prior
to bankruptcy that included an offer to purchase the Company's gas-producing
properties, but provided an option by the Company to repurchase the
properties
-4-
<PAGE>
within twelve months at a pre-set price based upon commercially reasonable
interest rates. Acceptance would have provided the Company with both
liquidity and the ability to recover its interests in the gas fields upon
exercise of the repurchase option.
4. According to testimony by Mr. Blystone in bankrutpcy court and
statements in letters to stockholders, current management has been soliciting
the sale of all of the Company's gas reserves. These reserves comprise the
only revenue generating assets owned by Tri-Valley. We believe that such a
sale should be approved by either a stockholder vote or by the bankruptcy
court. Current management, however, has not informed you of their actions in
this regard.
5. Over the combined opposition of the Committee, the Company's
Equity Committee and the United States Trustee overseeing the Company's
bankruptcy, the Company has been authorized by the bankruptcy court to
increase the Company's outstanding indebtedness by more than 15%. The
Committee believes that the terms of the proposed debt are irregular in that
the Company is required to pay to the lender an origination fee equal to 10%
of the principal amount of the loan. In addition, given past instances of
diversion of funds reported by the former Secretary and Treasurer of the
Company to the United States Bankruptcy Court, the Committee questions
whether management can be trusted to make prudent use of the loan proceeds.
6. Finally, members of the Committee have made several attempts
to make direct contact with the Board of Directors to discuss the Committee's
concerns. The members received no response to their inquiries, other than to
receive threats of litigation from the Board. As such, the Committee feels
compelled to make this proxy solicitation and establish a Board of Directors
that will be responsive to stockholder concerns.
REASONS FOR PROXY SOLICITATION
The Committee proposes that the Company's stockholders join it in
electing a new Board of Directors of the Company for the purpose of
implementing its plan for change, the first order of business of which will
be the removal of Mr. F. Lynn Blystone as President and Chief Executive
Officer and the review and evaluation of all other executive officers of the
Company. The second order of business will be to conduct the Company's
bankruptcy proceedings, after giving appropriate consideration to creditors,
for the stockholders' benefit, to emerge from bankruptcy in a manner that
will permit the Company to generate an optimal value for the stockholders and
to develop the Company's business consistent with the objective of long-term
growth.
-5-
<PAGE>
COMMITTEE OBJECTIVES
The Committee desires to bring to the Company the experience and
leadership needed to once again become a successful business.
The proposed Nominees have demonstrated business experience. The
Committee's slate include individuals with particular expertise in the oil,
gas and mineral industry and is augmented by individuals with strength in
finance and operations management.
If elected, the Nominees will initiate steps to implement a
successful long-term growth strategy of the Company. The Nominees' emphasis
will be focused, first, on a Plan of Reorganization for the Company's Chapter
11 bankruptcy that will address creditors' claims AND maximize stockholder
value, and, second, on the strategic development of the Company's assets.
While the Committee does not currently have a Reorganization Plan and may not
file such a plan with the United States Bankruptcy Court until after the
Company's exclusivity period for presenting a plan to the court, and while no
definitive plan alternatives have been decided upon, the Committee already
has an open dialogue with the Company's Creditors' Committee, Unsecured
Creditors' Committee and the the Official Equity Committee in the Company's
bankruptcy.
The Committee's business strategy also anticipates a thorough
analysis of market trends and opportunities. These actions are designed to
restore investor confidence, improve earnings and increase stockholder value.
These steps are expected to include:
1. Immediately working with the Company's creditors, including
Frank Agar, who the Committee believes is the largest creditor of the
Company, to work out a plan which satisfies the creditors and conserves value
for the stockholders. The Committee understands that the Company owes Mr.
Agar in excess of $660,000, including interest, and that this indebtedness is
secured with a deed of trust on all of the producing gas properties of the
Company. Assuming the Nominees are elected and work out a mutually
acceptable plan with Mr. Agar, Mr. Agar has indicated his willingness to work
with the Committee in developing a plan of reorganization for the Company, to
work with the Company in finalizing a restructuring of the Company, and to
join the Company as a member of the Board of Directors, if nominated and
elected, once the Company has emerged from bankruptcy.
2. The Nominees intend to give serious consideration to certain
strategic changes in the philosophy and operation of Tri-Valley. The Nominees
will review whether the Company would be better served by sharing more
extensively with other participants the costs and risks inherent in exploring
and developing the Company's property holdings.
-6-
<PAGE>
3. Promptly upon taking office, the Nominees will evaluate the
activities and performance of management and will make any changes that it
deems necessary to improve overall management performance.
4. Promptly upon taking office, the Nominees will take actions
necessary to cause the Company to be in compliance with SEC and any other
laws and regulations that have been neglected by present management.
5. The Committee believes that a "termination agreement" has been
granted to F. Lynn Blystone, the current Chairman and CEO. The Committee
believes that this termination agreement is not in the best interest of the
Company and should not have been approved by the incumbent Board of
Directors. The Committee believes that such a contract significantly
curtails the Company's freedom of action in its dealings with top management
officers. For example, if the Committee's nominees were elected to the Board
of Directors, this agreement reportedly requires a cash payment to be made by
the Company to Mr. Blystone in the amount of $100,000. The Committee believes
such contract should not have been implemented without shareholder consent
and ratification. Accordingly, if the Committee's slate of directors is
elected, the Committee pledges that it will study the legality and
enforceability of such contract as being wasteful of the Company's assets
and, if it determines that the contract is subject to legal attack on such
grounds, it will challenge such contract in appropriate legal proceedings.
6. The Nominees intend to retain experts and analysts in the
Company's various fields of operation in order to determine alternative
strategies for utilizing some or all of the Company's assets. Access to the
detailed and comprehensive data contained in the books and records of
Tri-Valley, which have not been available to the Committee and its advisor,
will help to define any plan which may ultimately be decided upon. Until a
definitive program is determined, however, the Nominees will use their best
efforts to operate the Company's businesses in the ordinary course and in a
manner which will improve Tri-Valley's relationships with its employees,
customers, suppliers and creditors.
7. The Nominees will focus on the Company's long-standing history
as an oil and gas company. In doing so, the Board will strive to return
Tri-Valley to its roots as a respected, active participant in oil and gas
exploration and production. In doing so, the Nominees intend to seek to
enhance share value, provide working capital and improve industry and market
recognition. The Nominees may consider moving the principal offices of the
Company to an industry center such as Dallas or Houston if such a move will
improve the Company's earning potential.
8. The Nominees will carefully review all transactions made by
the current management to determine their validity and purpose. Should
transactions be discovered which were made contrary to the interests of the
Company or were a breach of fiduciary duty, any actions available will be
taken to address such transactions.
-7-
<PAGE>
9. The Nominees intend to take action to renew all of the gold
mining claims that the Company has let lapse over the past year. Once
renewed, the Nominees intend to retain analysts to determine the
profitability of developing the gold properties.
It is the Committee's opinion that its proposals for change would
benefit the Company and the Company's stockholders.
The Committee believes that its Nominees to the Board of Directors
will, if elected, introduce positive changes to the Company. The Committee
urges stockholders to consider carefully this opportunity to bring
much-needed experience and expertise to the Company.
THE COMMITTEE'S NOMINEES
The following information has been furnished to the Committee by
the respective Nominees. Annex A to this Proxy Statement sets forth
additional information for each Committee Nominee as required by the federal
securities laws governing the use and distribution of this Proxy Statement.
The Committee proposes the following slate of seven candidates for election
to the Board of Directors of the Company:
ALFRED AINSWORTH, III, age 34, has worked in the oil and gas
industry for more than 15 years. Since 1994, he has served as President of
Ainsworth Production Company, Inc., an independent exploration and production
company which he founded. From 1989 to 1994, he served as Vice President of
Ainsworth Operating Company, a family owned and operated exploration and
production company. Mr. Ainsworth has also worked as a staff geologist for
Placid Oil Company, and as a financial consultant for Merrill Lynch Pierce
Fenner & Smith.
CHARLES B. BONNER, age 54, has served as President of Pacific
Resources Inc., a merger and acquisition and verture capital firm serving
middle market companies, since 1990. Prior to that, Mr. Bonner served as
President of Bonner Packing Company, a producer and distributor of dried
fruits, for 14 years. Mr. Bonner presently serves on the Board of Directors
of a number of organizations, including the Boy Scouts of America, Fresno,
California.
C. DOUGLAS BROWN, age 34, has more than 10 years of experience in
the oil and gas industry. He is currently President of BXP Company, LLC, a
privately-owned, independent oil and gas acquisition and development company.
Prior to founding BXP, Mr. Brown served as Acquisition Coordinator for
Petro-Hunt Corporation. From 1986 to 1992, Mr. Brown served as a production
and exploration geologist for Sun Exploration and Production Company and Oryx
Energy Company.
-8-
<PAGE>
J. BRUCE CARRUTHERS II, age 61, has worked in the natural resources
industry throughout his entire career. Since 1989, he has served as
President and Chairman of the Board of Hexagon Resources, Inc., a mining
exploration and development company for which he was the co-founder. Prior
to that, Mr. Carruthers worked for Occidental Petroleum Corporation for 18
years, holding various positions, including Director of International Trade,
Planning Manager for Worldwide Oil and Gas Exploration and Production,
Manager of New Ventures and Petroleum Supply Manager. Mr. Carruthers was
also the founder and President and Chief Executive Officer of a
high-technology energy service corporation. Mr. Carruthers was a member of
the Board of Directors of Tri-Valley until 1996, when he resigned in a
dispute with management over the conduct of Company affairs.
JOHN E. GRANT, age 48, is presently a self-employed rancher. Mr.
Grant previously worked as a self-employed real estate broker and as an
agricultural and commercial real estate developer. From 1988 to 1989, Mr.
Grant was Vice President of Tri-Valley, during which time he supervised the
Company's gold mining operations. In 1993, Mr. Grant personally filed a
petition under the Federal bankruptcy laws.
LORRIE T. OLIVIER, age 45, has twenty-two years of management
experience in international and domestic oil and gas operations. Mr. Olivier
is presently Vice President of American International Petroleum Corporation
(AIPC). From 1991 to 1994, Mr. Olivier served as Manager of Colombian
Operations and Manager of International Operations for AIPC. Prior to
joining AIPC, Mr. Olivier was Managing Director and founder of Colamer Ltd.,
a managerial and consulting firm specializing in small and medium size oil
and gas companies. Mr. Olivier has served as a Director of I.B.C. Limited
since 1990. I.B.C. Limited manages private placements of capital in various
natural resource ventures, including Tri-Valley Corporation.
TODD A. OSETH, age 33, has served as Vice President of Business
Development and Acquisitions for Sony Electronics since 1995. In 1993, he
founded Enhanced Memory Systems, a subsidiary of Ramtron International
Corporation, a public company and leading producer of high speed computer and
memory products. Mr. Oseth served as President of Enhanced Memory Systems
until he joined Sony Electronics in 1995. From 1989 to 1993, Mr. Oseth served
as Vice President of Business Development for Ramtron International
Corporation.
Each Nominee has agreed to serve if elected, and the Committee does
not know of any reason why any of the Nominees will not stand for election or
serve if elected.
There are no arrangements or understandings between any Nominee and
any other person pursuant to which he was selected as a Nominee or is
proposed to be elected, except as disclosed in this Proxy Statement. As to
those Nominees who are also members of the Committee, each has agreed, among
other things, to vote his shares in favor of the Nominees. Other than Mr.
Grant, no Committee Nominee
-9-
<PAGE>
has ever been employed by the Company or any subsidiary or affiliate of the
Company.
The Committee understands that outside directors of the Company are
currently paid an annual retainer and a fee and reimbursement of reasonable
expenses for attending board meetings. The Nominees, if elected, will review
the entire compensation program for service on the Board of Directors of the
Company. The Nominee's current intention is to provide for no compensation
for outside directors except for reimbursement of reasonable expenses.
PLEASE VOTE WITH THE COMMITTEE BY SIGNING, DATING AND MAILING
PROMPTLY THE ENCLOSED PROXY (PRINTED IN GREEN) IN THE POSTAGE-PAID ENVELOPE
PROVIDED.
OTHER ACTIONS AT THE STOCKHOLDERS MEETING
At the stockholders meeting, stockholders may be asked to appoint
independent auditors or take other actions incident to the meeting not
currently known by the Committee. The grant of the enclosed proxy to the
Committee will authorize the Committee to vote upon matters not known to the
Committee as of the date of this proxy statement that arise at the
stockholders meeting, matters incident to the conduct of the stockholders
meeting, and to vote for any nominee of the Committee whose nomination
results from the inability of the Committee's nominees to serve on the
Company's Board of Directors.
VOTING RIGHTS AND USE OF THE PROXY CARD
You can vote on the election of directors to the Company' Board by
using the enclosed green Proxy Card. The Committee will keep all cards it
receives confidential from the Company until the deadline for their
submission, absent a court order requiring disclosure.
Because the Committee is uncertain whether the Company intends to
hold a true annual meeting of stockholders or merely a special meeting of
stockholders for the election of directors, and because the date of the
meeting at this time is uncertain, the proxy solicited by the Committee
grants authority to the proxies to vote your shares at the next annual
meeting of stockholders or at the next special meeting of stockholders at
which an election of directors is held, together with any adjournments
thereof.
If you sign and return the enclosed green card and do not instruct
the Committee how to vote, the Committee will vote for all of its nominees to
the Company's Board of Directors. If any other business should come before
the meeting other than an election of directors, the proxy holders will vote
your shares in their best judgment.
-10-
<PAGE>
Only stockholders of record as of the record dated established by
the Company's Board are entitled to vote. As of the date of this proxy
statement, no record date had been established, according to the transfer
agent for the Company's Common Stock. While it is the Company's
responsibility to set a record date within 60 days of the meeting, mail proxy
or informational materials within 20 days of the meeting date, and give
notice to stockholders of the meeting within 10 days of the meeting date, the
Committee will endeavor to inform each stockholder to whom it sends this
proxy statement of the record and meeting dates once it learns of such dates.
A quorum of holders represented in person or by proxy of a majority
of the common stock of the Company will be required for the conduct of the
stockholders meeting. A vote of a majority of the holders of Company common
stock represented at the stockholders meeting will be required to elect the
Committee's nominees to the Company's Board.
SOLICITATION OF PROXIES
The persons designated on the Committee's proxy cards are Alfred
Ainsworth, III, and Lorrie T. Olivier, members of the Committee. The
Committee expects to solicit proxies by mail, telephone, facsimile, telegram
or personal solicitation or other means of communication, for which efforts
no compensation will be paid. Banks, brokerage houses and other custodians,
nominees and fiduciaries will be requested to forward the solicitation
material of the Committee to their customers for whom they hold shares and
the Committee will reimburse them for their reasonable out-of-pocket expenses.
The expense of preparing and mailing this Proxy Statement and any
other soliciting material and the total expenditures relating to this
solicitation campaign (including, without limitation, costs, if any, relating
to advertising, printing, attorneys' fees and the like) will be borne by the
Committee members, jointly and severally, unless otherwise determined by the
Committee. The Nominees (other than those who are also Committee members)
will not bear any portion of such costs of the solicitation. It is estimated
that total expenses relating to this solicitation (excluding the cost of
litigation) will be approximately $5,000. Total expenditures to date have
been approximately $1,000. The Committee intends to seek reimbursement for
these expenses from the Company in the event that its nominees are elected to
the Company's Board of Directors and does not presently expect to seek
stockholder approval for such reimbursement at a subsequent meeting unless
such approval is required under Delaware law.
-11-
<PAGE>
ADDITIONAL INFORMATION
Information provided in this Proxy Statement about the Company is
based upon the information contained in the Company's various filings with
the Securities and Exchange Commission. Accordingly, reference is herein
made to such filings for information concerning the incumbent directors of
the Company, the beneficial ownership of the Company's shares of common stock
by directors, management and principal stockholders of the Company,
compensation and other benefits afforded directors and certain members of
management of the Company, and the procedures for submitting stockholder
proposals for consideration in the next annual meeting of the Company's
stockholders.
Subject to the foregoing, the following Table sets forth
information with respect to each person known to the Committee to be a
beneficial owner of more than five percent (5%) of the outstanding common
stock of the Company, each known director and all directors and executive
officers of the Company, as a group. Information with respect to the
Nominees is set forth elsewhere in this Consent Statement.
-12-
<PAGE>
PRINCIPAL STOCKHOLDERS OF THE COMPANY
-------------------------------------
NAME OF SHARES PERCENTAGE OF
BENEFICIAL OWNER BENEFICIALLY OWNED COMMON STOCK(1)
---------------- ------------------ ---------------
Edgar Moss 550,857 7.51%
Victor Millar 400,000 5.45
F. Lynn Blystone(3) 370,064 5.04
Earl H. Beistline(3) 5,000 (2)
Milton J. Carlson(3) 49,000 (2)
Dennis P. Lockhart(3) 41, 091 (2)
Loren Miller(3) 15,300 (2)
Terrance L. Stringer(3) 52,045 (2)
All officers and directors
as a group (six persons) 532,500 7.26
______________
(1) Based upon the Company's filings with the Securities and Exchange
Commission and the Company's most recently available stockholders
list. The Committee notes that the latest annual or quarterly
report on file with the Commission is the Company's quarterly
report on Form 10-Q for the period ended April 30, 1995. The most
recently available stockholders list, obtained from the Company's
filings with the United States Bankruptcy Court, stated that the
Company had 7,337,248 share of common stock outstanding. Because
this public information is dated, the information in this table may
be inaccurate.
(2) Less than one percent (1%).
(3) Mr. Blystone is President and Chief Executive Officer of the Company.
Messrs. Beistline, Carlson, Lockhart, Miller and Stringer are
members of the Board of Directors of the Company.
See Annex A for certain additional information regarding
the Committee and its nominees to the Board of Directors of the
Company.
-13-
<PAGE>
PLEASE SIGN, DATE AND RETURN THE ENCLOSED GREEN PROXY CARD IN THE
ENVELOPE PROVIDED.
IF YOUR SHARES OF THE COMPANY'S COMMON STOCK ARE HELD IN THE NAME
OF A BROKERAGE FIRM, BANK OR NOMINEE, ONLY THEY CAN EXECUTE THE PROXY AND
ONLY UPON RECEIPT OF YOUR SPECIFIC INSTRUCTIONS. ACCORDINGLY, PLEASE CONTACT
THE PERSON RESPONSIBLE FOR YOUR ACCOUNT AND GIVE INSTRUCTIONS FOR SUCH SHARES
IMMEDIATELY.
IF YOU HAVE ANY QUESTIONS OR REQUIRE ASSISTANCE, PLEASE CALL ALFRED
AINSWORTH, CHAIRMAN OF THE COMMITTEE, AT (719) 590-6005.
-14-
<PAGE>
ANNEX A
INFORMATION REGARDING COMMITTEE
MEMBERS, COMMITTEE NOMINEES AND OTHERS
Set forth below is certain information about the Committee members,
Committee Nominees, other participants (as that term is defined under
applicable federal securities laws), and their associates, if any. Except as
set forth in the Proxy Statement or this Annex A, no Committee member,
Committee Nominee, or other participant (or for purposes of clauses (ii),
(iv), (v), (vi), (viii), (ix) and (x), no associate of such person) (i) has
been convicted in a criminal proceeding (excluding traffic violations or
similar misdemeanors) during the last ten years (ii) owns beneficially,
directly or indirectly, any securities of the Company or any parent or
subsidiary of the Company, (iii) owns any securities of the Company of
record, but not beneficially, (iv) within the past two years has purchased or
sold any securities of the Company, (v) has current indebtedness incurred for
the purpose of acquiring or holding the securities of the Company referred to
in (iv) above, (vi) is or has been within the past year a party to any
contract, arrangement or understanding with respect to any securities of the
Company, (vii) has had since the beginning of the Company's last fiscal year,
or is to have, a direct or indirect material interest in any transaction or
any proposed transaction, to which the Company or any of its affiliates was
or is a party (viii) has any substantial interest in any matter to be acted
upon under this Proxy solicitation, (ix) has any arrangement or understanding
with respect to future transactions to which the Company or any of its
affiliates will or may be a party or (x) is involved in any pending legal
proceedings as a party adverse (or has a material interest adverse) to the
Company or any subsidiary of the Company. Except as set forth below, each
holder of the Company's shares listed below has sole voting and investment
power over the Company's shares beneficially owned by such holder.
BACKGROUND INFORMATION
NAME AND PRESENT SHARES
BUSINESS ADDRESS OCCUPATION BENEFICIALLY OWNED
----------------- ---------- ------------------
Alfred Ainsworth, III President, oil & gas 10,000
Ainsworth Production Company, Inc. company
2 North Cascade, Suite 1100
Colorado Springs, CO 80903
Charles B. Bonner President, venture 30,000
4884 N. Van Ness Boulevard capital firm
Fresno, CA 93704
Charles D. Brown President, oil & gas 5,000
3625 N. Hall Street, #560 company
Dallas, TX 75219
A-1
<PAGE>
J. Bruce Carruthers, II President, mining 185,286(1)
Hexagon Resources company
1620 West University Heights
Drive North
Flagstaff, AZ 86001
Jay T. Dalton International business 20,000
2431 East 61st Street, Suite 200 attorney
Tulsa, OK 74136-1230
John Grant Rancher 29,000(2)
43940 Battle Mountain Drive
Springsville, CA 93265
Eugene R. Hering Executive management, 20,000
Occidental of Albania, Inc. energy company
Durres Compound, Villa 20
Durres, Albania
Marc R. Herman President, international 1,570
M.H. Investments, Inc. clothing manufacturer
13212 Raymer
North Hollywood, CA 91605
Bernard L. Larsen Consulting engineer 40,000
6946 Sunrise Court
Coral Gables, FL 33133
Lorrie T. Olivier Vice President, 253,330(3)
American International Petroleum Corp. oil and gas company
55 Waugh Drive, Suite 606
Houston, TX 77007
Todd A. Oseth Vice President of 10,000
Sony Electronics Business Development,
One Sony Place electronics company
San Antonio, TX 78245
James J. Williams, as representative Executive management, 19,090(4)
of Patexco Employees' Pension Trust energy company
c/o Occidental of Albania, Inc.
Durres Compound, Villa 20
Durres, Albania
______________
(1) Mr. Carruthers disclaims beneficial ownership as to 20,000 such
shares, for which he acts as custodian on behalf of his children.
(2) Mr. Grant disclaims beneficial ownership as to all 29,000 shares,
for which he acts as custodian on behalf of his children.
(3) Mr. Olivier disclaims beneficial ownership as to 248,090 shares,
for which he has sole voting power and sole investment power as
director of IBC Ltd.
(4) Mr. Williams disclaims beneficial ownership as to all 19,090
shares, for which he has voting and investment power as a trustee of the
Patexco Employee's Pension Trust.
A-2
<PAGE>
BENEFICIAL OWNERSHIP OF SHARES
As of May 13, 1996, the Committee's Nominees owned shares of the
Company's common stock of record and beneficially as disclosed in the
following Table:
SHARES
NAME BENEFICIALLY OWNED PERCENT OF CLASS
---- ------------------ ----------------
Alfred Ainsworth, III 10,000 0.14%
Charles B. Bonner 30,000 0.42%
Charles D. Brown 5,000 0.07%
J. Bruce Carruthers, II 165,286 2.34%
John Grant 0 0.00%
Lorrie T. Olivier 5,240 0.07%
Todd A. Oseth 10,000 0.14%
STOCK TRANSACTIONS WITHIN THE PAST TWO YEARS
The following table set forth information with respect to all
purchases and sales of Common Stock of the Company by each Committee Nominee
during the past two years. No part of the purchase price is represented by
borrowed funds.
NAME PURCHASE DATE
---- -------- ----
Alfred Ainsworth, III 1,000 12/8/95
6,000 2/14/96
3,000 2/20/96
Charles D. Brown 5,000 2/23/96
Todd A. Oseth 10,000 2/13/96
A-3
<PAGE>
PRELIMINARY PROXY MATERIAL
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION
ON MAY 30, 1996
PROXY CARD
TRI-VALLEY CORPORATION
THIS PROXY IS SOLICITED BY THE TRI-VALLEY COMMITTEE FOR NEW MANAGEMENT
The undersigned stockholder of Tri-Valley Corporation, a Delaware
corporation (the "Company"), hereby appoint(s) Alfred Ainsworth, III and
Lorrie T. Olivier, and each of them, with full power of substitution, proxies
of the undersigned to vote all shares of the undersigned in the Company at
the next annual meeting of stockholders of the Company, or at the next
special meeting of the stockholders at which an election of directors is
held, and any adjournments thereof (the "Meeting"). This proxy shall be
valid, and shall not expire, until the earlier of the conclusion of the
Meeting or December 31, 1996.
THE TRI-VALLEY COMMITTEE FOR NEW MANAGEMENT STRONGLY RECOMMENDS A VOTE
FOR THE ELECTION OF EACH NOMINEE LISTED BELOW TO THE BOARD OF DIRECTORS OF
THE COMPANY.
1. ELECTION OF NOMINEES TO THE BOARD OF DIRECTORS OF THE COMPANY.
<TABLE>
<S> <C> <C>
/ / FOR all nominees listed below (except / / WITHHOLD AUTHORITY / / ABSTAIN
as marked to the contrary in the to vote for all nominees
space below) listed below
</TABLE>
Alfred Ainsworth, III, Charles B. Bonner, C. Douglas Brown, J. Bruce
Carruthers, II, John E. Grant, Lorrie T. Olivier, Todd A. Oseth
INSTRUCTIONS: To grant authority, withhold authority or abstain as to the
vote for the election of all candidates, check the appropriate box above. To
withhold authority to vote for any particular nominee(s), write the name(s)
of such director(s) in the following space:
NOTE: If no box is marked in number one above, the undersigned will be
deemed to vote "FOR" all nominees listed.
2. IN THEIR DISCRETION, THE PROXIES ARE AUTHORIZED TO VOTE UPON MATTERS NOT
KNOWN TO THE TRI-VALLEY COMMITTEE FOR NEW MANAGEMENT AS OF THE DATE OF
THE ACCOMPANYING PROXY STATEMENT THAT ARISE AT THE MEETING, MATTERS
INCIDENT TO THE CONDUCT OF THE MEETING AND TO VOTE FOR ANY NOMINEE WHOSE
NOMINATION RESULTS FROM THE INABILITY OF ANY OF THE ABOVE NAMED NOMINEES TO
SERVE ON THE COMPANY'S BOARD OF DIRECTORS.
The invalidity, illegality or unenforceability of any particular provision of
this Proxy shall be construed in all respects as if such invalid, illegal or
unenforceable provision were omitted without the validity, legality or
unenforceability of the remaining provisions hereof. This card revokes all
prior proxies or revocations of proxy with respect to shares held by the
undersigned.
PLEASE SIGN, DATE AND RETURN THIS PROXY PROMPTLY, USING THE ENCLOSED
ENVELOPE.
Please sign exactly as your name appears as a stockholder of the Company. If
shares are registered in more than one name, the signatures of all such
persons are required. A corporation should sign its full corporate name by a
duly authorized officer, stating his/her title. Trustees, guardians,
executors and administrators should sign in their official capacity, giving
their full title as such. If a partnership or limited liability company,
please sign in the partnership or limited liability company name by
authorized persons.
_________________________ Dated: _________________, 1996.
(Name)
_________________________
(Signature)
_________________________ __________________________________
(Joint Signature, if held jointly) (Title or authority, if applicable)
