<PAGE> 1
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement / / Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
Mitchell Energy & Development Corp.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(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.
(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> 2
MITCHELL ENERGY & DEVELOPMENT CORP.
2001 TIMBERLOCH PLACE -- P.O. BOX 4000
THE WOODLANDS, TEXAS 77387-4000
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JUNE 28, 1995
TO THE STOCKHOLDERS:
Notice is hereby given that the Annual Meeting of Stockholders of MITCHELL
ENERGY & DEVELOPMENT CORP. (the "Company") will be held at The Woodlands
Executive Conference Center and Resort, 2301 North Millbend Drive, The
Woodlands, Texas 77380, on Wednesday, June 28, 1995, at 10:00 A.M. Central
Daylight Time, for the following purposes:
1. To elect a Board of twelve (12) directors;
2. To consider and act upon a proposal to appoint Arthur Andersen LLP
as the Company's independent public accountants for the fiscal year ending
January 31, 1996; and
3. To transact such other business as may properly come before the
meeting.
Holders of both Class A Common Stock and Class B Common Stock are entitled
to notice of the Annual Meeting; however, only holders of Class A Common Stock
of record at the close of business on May 10, 1995, are entitled to vote at the
Annual Meeting or any adjournment or adjournments thereof.
Information concerning the matters to be acted upon at the Annual Meeting
is set forth in the accompanying Proxy Statement.
CLASS A COMMON STOCKHOLDERS:
PLEASE COMPLETE, DATE, SIGN AND RETURN THE ENCLOSED PROXY IN THE
ACCOMPANYING ENVELOPE, WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES,
WHETHER OR NOT YOU INTEND TO BE PRESENT AT THE MEETING. THE PROXY IS REVOCABLE
AT ANY TIME PRIOR TO THE VOTING OF SUCH PROXY.
A copy of the Annual Report to Stockholders for the fiscal year ended
January 31, 1995, has preceded this Notice and Proxy Statement.
By Order of the Board of Directors,
THOMAS P. BATTLE
Secretary
May 19, 1995
<PAGE> 3
MITCHELL ENERGY & DEVELOPMENT CORP.
2001 TIMBERLOCH PLACE -- P.O. BOX 4000
THE WOODLANDS, TEXAS 77387-4000
PROXY STATEMENT
SOLICITATION AND REVOCABILITY OF PROXIES
Proxies are being solicited by the Board of Directors of the Company for
use at the Annual Meeting of Stockholders to be held on June 28, 1995, and at
any adjournment or adjournments thereof. In addition to mailing proxy materials,
such solicitations may be in person or by telephone by directors, officers or
employees of the Company, who will receive no additional compensation therefor.
Upon request, the Company will reimburse banks, nominees, and agents of the
stockholders for reasonable costs incurred by them in sending proxy materials to
beneficial owners of the Company's Class A Common Stock and its Class B Common
Stock (collectively, "Common Stock"). The entire cost of soliciting proxies in
the accompanying form will be borne by the Company.
This Proxy Statement and the proxy cards are first being mailed to
stockholders on or about May 19, 1995.
A PROXY MAY BE REVOKED AT ANY TIME PRIOR TO THE VOTING OF SUCH PROXY BY THE
SUBSEQUENT EXECUTION AND SUBMISSION OF A REVISED PROXY, BY WRITTEN NOTICE OF
REVOCATION TO THE SECRETARY OF THE COMPANY, OR BY VOTING IN PERSON AT THE
MEETING.
VOTING OF PROXIES
It is the policy of this Company to provide stockholders complete privacy
in voting. Proxy cards are returned in envelopes to our independent tabulating
agent, who receives, inspects, and tabulates the proxies. Voted proxies are not
seen by nor reported to the Company, except in aggregate number and in limited
circumstances.
The proxy card accompanying the Proxy Statement mailed to each stockholder
of record of the Company's Class A Common Stock at the close of business on May
10, 1995, is designed to permit such stockholder to vote in the election of
directors and on the proposals described in this statement. It provides space
for a stockholder to withhold voting for any or all nominees for the Board of
Directors, or to abstain from voting for any proposal if so desired.
The proxy card specifies Bernard F. Clark, Vice Chairman of the Company,
and Thomas P. Battle, General Counsel and Secretary of the Company, to vote all
shares represented by proxies returned to the Company. A stockholder wishing to
name as his proxy someone other than those designated on such proxy card may do
so by crossing out the names of the two designated proxies and inserting the
name of the person he wishes to act as his proxy. In that case, it will be
necessary for the stockholder to sign the proxy and deliver
<PAGE> 4
it to the person named and for the person so named to be present and vote at the
meeting. Proxy cards so changed should not be mailed to the Company.
When a stockholder's proxy card specifies a choice with respect to a matter
being voted upon, the shares will be voted accordingly. If no such
specifications are made, the shares will be voted for the election of all
nominees as directors, in favor of the appointment of Arthur Andersen LLP as the
Company's independent public accountants, and in accordance with the discretion
of the person voting it with respect to any other business properly before the
meeting. The election of directors and the ratification of the appointment of
Arthur Andersen LLP as independent public accountants will require the
affirmative vote of a majority of the shares of Class A Common Stock voting in
person or by proxy at the Annual Meeting, assuming a quorum is present. The
Bylaws of the Company require, for a quorum, the presence at the Annual Meeting
in person or by proxy of the holders of a majority of the shares of capital
stock of the Company entitled to vote. Thus, abstentions and broker non-votes
will not be included in vote totals and will have no effect on the outcome of
any vote, although they will be counted in the determination of a quorum.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
Only holders of record of shares of Class A Common Stock of the Company at
the close of business on May 10, 1995 are entitled to vote at the Annual Meeting
or any adjournment or adjournments thereof, each share having one vote on each
matter to be presented at the Annual Meeting. There were 23,208,923 shares of
the Company's Class A Common Stock outstanding on the record date.
To the knowledge of the Company, the only person owning beneficially more
than five percent of the Company's outstanding Class A Common Stock, its only
class of outstanding voting securities, as of March 15, 1995 is as set forth in
the following table:
<TABLE>
<CAPTION>
TOTAL AMOUNT
OF CLASS A
COMMON STOCK
BENEFICIALLY PERCENT
NAME AND ADDRESS OWNED OF CLASS
---------------- ------------ ---------
<S> <C> <C>
George P. Mitchell........................................... 14,726,604(a) 63.5%
2001 Timberloch Place
The Woodlands, Texas
</TABLE>
- ---------------
(a) See notes (a) and (b) to the table under "Security Ownership of Management."
2
<PAGE> 5
SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth the number of shares of each class of the
Company's Common Stock owned beneficially by each of its directors and nominees
for director, by its executive officers named in the Summary Compensation Table
and by all directors and executive officers as a group as of March 15, 1995:
<TABLE>
<CAPTION>
TOTAL AMOUNT TOTAL AMOUNT
OF CLASS A OF CLASS B
COMMON STOCK COMMON STOCK
BENEFICIALLY PERCENTAGE BENEFICIALLY PERCENT
NAME OWNED(a) OF CLASS A OWNED(a) OF CLASS B
---- ------------ ---------- ------------ ----------
<S> <C> <C> <C> <C>
Robert W. Baldwin................... -- * -- *
Bernard F. Clark.................... 50,571(c) * 50,671(c) *
William D. Eberle................... 599 * 599 *
Roger L. Galatas.................... 10,822 * 10,822 *
Shaker A. Khayatt................... 266(d) * 266(d) *
Ben F. Love......................... 2,500 * 2,500 *
Walter A. Lubanko................... 4,000 * 4,000 *
George P. Mitchell.................. 14,726,604(b) 63.5% 13,726,604(b) 47.6%
J. Todd Mitchell.................... 16,989(e) * 16,989(e) *
M. Kent Mitchell.................... 24,348 * 24,348 *
Michael B. Morris................... 2,000 * 2,000 *
Philip S. Smith..................... 7,500 * 7,500 *
W. D. Stevens....................... 13,250 * 10,750 *
Allen J. Tarbutton, Jr. ............ 17,997 * 18,183 *
Raymond L. Watson................... 2,500 * 2,500 *
J. McDonald Williams................ -- * 2,500 *
All directors and executive officers
as a group (17 persons)........... 14,888,712(b-f) 64.1% 13,889,008(b-f) 48.2%
</TABLE>
- ---------------
* Less than 1%.
(a) Unless otherwise indicated, beneficial owners have sole rather than shared
voting and investment power respecting their shares, other than shared
rights created under joint tenancy or marital property laws as between the
Company's directors and officers and their respective spouses, if any.
(b) Includes shares held by George P. Mitchell's wife (511,253 Class A and
511,253 Class B), as to which Mr. Mitchell disclaims beneficial ownership.
(c) Includes shares held by Mr. Clark's wife (26,172 Class A and 26,272 Class
B), as to which Mr. Clark disclaims beneficial ownership.
(d) Includes shares held by Mr. Khayatt's wife (266 Class A and 266 Class B), as
to which Mr. Khayatt disclaims beneficial ownership.
(e) Includes shares held by J. Todd Mitchell's wife (250 Class A and 250 Class
B), as to which Mr. Mitchell disclaims beneficial ownership.
(Notes continued on following page)
3
<PAGE> 6
(f) Includes shares which certain officers have a right to acquire within 60
days following March 15, 1995 by exercising stock options. The following
shares underlying such unexercised options were added to the holdings of
each of the following executive officers: Mr. Galatas -- 4,250 Class A and
10,250 Class B; Mr. Smith -- 7,500 Class A and 7,500 Class B; Mr.
Stevens -- 10,000 Class A and 10,000 Class B; Mr. Tarbutton -- 6,900 Class A
and 6,900 Class B and all executive officers as a group 37,400 Class A and
43,400 Class B. No director or nominee for director (other than Mr. Stevens)
has the right to acquire any shares within such 60 day period.
ELECTION OF DIRECTORS
Twelve directors are to be elected and qualified, for a term commencing on
the date of this Annual Meeting and continuing until the next Annual Meeting of
Stockholders or until their successors have been duly elected and qualified.
Each nominee listed below currently serves as a member of the Company's Board of
Directors and was elected at the Annual Meeting held on June 29, 1994 except for
J. McDonald Williams who was elected by the Company's Board of Directors on
October 19, 1994 for a term of office continuing until the Annual Meeting of
Stockholders. Michael B. Morris died in April, 1995. In the event that any
nominee for director should become unavailable to serve, it is intended that
votes will be cast, pursuant to the proxy card, for such substitute nominee as
may be nominated by the Board of Directors. The Company has no present knowledge
that any of the nominees will be unable to serve.
The nominees for directors are as follows:
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION AND DIRECTOR
NAME AGE BUSINESS EXPERIENCE DURING PAST FIVE YEARS SINCE
---- --- --------------------------------------------- --------
<S> <C> <C> <C>
Robert W. Baldwin............. 74 Consultant (Energy/Management); President of 1983
Gulf Refining and Marketing Company, a
division of Gulf Oil Corp., 1975-1981
Bernard F. Clark.............. 73 Vice Chairman of the Board of the Company 1962
William D. Eberle............. 71 Chairman of the Board of Manchester 1976
Associates venture capital consulting, since
1977; Of Counsel on trade issues to Kaye,
Scholer, Fierman, Hays and Handler,
attorneys-at-law, since 1993; Chairman of
Greenwich Entertainment Group, Inc., movie
theater entertainment, since 1994
Shaker A. Khayatt............. 59 President and Chief Executive Officer of 1972
Khayatt and Company, Inc., investment
banking, since 1979
Ben F. Love................... 70 Consultant to Texas Commerce Bancshares, 1990
Inc., a bank holding company, since 1989;
Chairman and Chief Executive Officer of
Texas Commerce Bancshares, Inc., 1972-1989
(Table continued on following page)
</TABLE>
4
<PAGE> 7
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION AND DIRECTOR
NAME AGE BUSINESS EXPERIENCE DURING PAST FIVE YEARS SINCE
---- --- --------------------------------------------- --------
<S> <C> <C> <C>
Walter A. Lubanko............. 69 Chairman and President of W. A. Lubanko & 1972
Co., Inc., investment banking, since 1977
George P. Mitchell............ 75 Chairman of the Board and Chief Executive 1947
Officer of the Company
J. Todd Mitchell.............. 36 President of and geologist for The Discovery 1993
Bay Company, a seismic data analysis software
company, since 1992; President of and
geologist for Dolomite Resources, Inc., a
mineral exploration and investments
company, since 1987
M. Kent Mitchell.............. 42 President and Chief Executive Officer of Bald 1988
Head Island Management, Inc., real estate
development and sales, since 1983
W. D. Stevens................. 60 President and Chief Operating Officer of the 1992
Company since January 3, 1994; President of
Exxon Company, U.S.A., 1988-February 1,
1992
Raymond L. Watson............. 68 Chairman of the Executive Committee of the 1983
Board of Directors of The Walt Disney
Company, entertainment company, since 1984;
Vice Chairman of The Irvine Co., real
estate development, since 1986
J. McDonald Williams.......... 53 Chairman of Trammell Crow Company, real 1994
estate services, since August 1994; President
and Chief Executive Officer of Trammell
Crow Company, 1990-1994; Managing Partner
of Trammell Crow Company, 1977-1990
</TABLE>
There are no family relationships by blood, marriage or adoption between
any nominee for director or any of the executive officers of the Company, except
that J. Todd Mitchell and M. Kent Mitchell are sons of George P. Mitchell.
The nominees for directors hold the following directorships in other public
corporations: William D. Eberle -- America Service Group, Ampco-Pittsburgh
Corp., Fibreboard Corporation, Mid-States, PLC, Showscan Film Corporation,
Sirrom Capital Corporation and Ventura Entertainment Group; Ben F. Love --
Burlington Northern Inc., Eli Lilly & Company, and El Paso Natural Gas Company;
George P. Mitchell -- MCorp; Raymond L. Watson -- The Walt Disney Company and
Tejon Ranch Company; and J. McDonald Williams -- A.H. Belo Corporation.
George P. Mitchell could be deemed to be a control person with respect to
the Company by virtue of his ownership of Common Stock of the Company.
During the Company's fiscal year ended January 31, 1993, Eprotek Inc., a
company of which Shaker A. Khayatt was secretary, filed a petition under federal
bankruptcy laws. During the past five years, approxi-
5
<PAGE> 8
mately 60 out of about 1,800 real estate partnerships in which J. McDonald
Williams is or has been a general partner are or were involved in Chapter 11
bankruptcy proceedings. Mr. Williams' ownership interest in such partnerships
resulted from his role as a managing general partner of Trammell Crow Company.
The Company's Board of Directors has an Audit Committee which consisted
during all or part of the Company's fiscal year ended January 31, 1995
(hereinafter "fiscal 1995") of Ben F. Love, Walter A. Lubanko, Michael B.
Morris, Raymond L. Watson and Benjamin N. Woodson. During fiscal 1995, the Audit
Committee met three times. The functions performed by the Audit Committee
include reviewing the nature of the services rendered by the Company's
independent public accountants, relating to both auditing and nonauditing
services. The Committee also reviews, with representatives of the independent
public accountants, the scope of the independent public accountants' audit of
the Company's financial statements, results of those audits, and any weaknesses
in internal accounting controls identified by the independent public accountants
in the course of their audit. The Committee each year recommends to the Board of
Directors the appointment of a firm of independent public accountants for the
coming year, and reviews the various other presentations and reports to the
Board of Directors relating to accounting matters and financial statements.
The Company's Board of Directors has a Compensation Committee which
consisted during all or part of fiscal 1995 of Robert W. Baldwin, William D.
Eberle, Shaker A. Khayatt, M. Kent Mitchell and Michael B. Morris. During fiscal
1995, the Compensation Committee met six times. As stated in its Report on
Executive Compensation beginning at page 11 of this Proxy Statement, the
Compensation Committee establishes policies with respect to compensation for
executives, determines pay levels for senior executives including all named
executive officers, reviews compensation levels for all other members of Company
senior management, and sets and monitors overall compensation programs and
policies for the Company's entire work force.
The Company's Board of Directors has an Executive Committee which consists
of Ben F. Love, William D. Eberle, M. Kent Mitchell, J. Todd Mitchell and W. D.
Stevens. The Executive Committee met three times during fiscal 1995. The
function of the Executive Committee is to (i) select and nominate successor(s)
to George P. Mitchell in the event he were disabled or otherwise unable to
function as Chairman of the Board and Chief Executive Officer of the Company,
(ii) nominate individuals to serve as directors of the Company, and (iii)
perform such other functions as are delegated to it by the Board. The Committee
will consider stockholder recommendations for director sent to the Executive
Committee, c/o Thomas P. Battle, Secretary, Mitchell Energy & Development Corp.,
P.O. Box 4000, The Woodlands, Texas 77387-4000.
The Company's Board of Directors met seven times during fiscal 1995 and
held four special telephonic meetings. Each director attended more than 75
percent of the aggregate number of meetings of directors and committees on which
he served except for Ben F. Love.
Currently, each director who is not an employee of the Company receives
$47,500 a year for serving as a director and for serving as a member on one or
more committees. Each director who is an employee of the Company receives $100
for each directors' meeting which he attends. All directors are reimbursed for
any travel, lodging and other expenses incurred in connection with attending any
meetings of directors or a committee. Additionally, the Company offers to pay
the premium on a $100,000 term life insurance policy for any of its non-employee
directors who choose to maintain such coverage. Currently the Company provides
such insurance for three of its non-employee directors at an annual premium of
$180 per policy.
6
<PAGE> 9
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table sets forth certain compensation information for the
Chief Executive Officer ("CEO") and the four other most highly compensated
executive officers of the Company for services rendered in all capacities during
the fiscal years ended January 31, 1995, 1994 and 1993.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
-------------------------
SECURITIES
ANNUAL UNDERLYING
COMPENSATION(a) STOCK ALL
------------------- OPTION LTIP OTHER
FISCAL SALARY BONUS AWARDS PAYOUTS(c) COMPEN-
NAME/PRINCIPAL POSITION YEAR ($) ($) (#) ($) SATION
- ----------------------- ------ ------- ------- ---------- ---------- -------
<S> <C> <C> <C> <C> <C> <C>
George P. Mitchell............. 1995 680,004 150,000 -- -- 230,882(d)
Chairman and CEO 1994 650,004 150,000 -- -- 283,135(e)
1993 650,004 200,000 -- -- 488,810(f)
W. D. Stevens.................. 1995 400,008 150,000 -- -- 22,601(g)
President and Chief Operating 1994 33,334 -- 120,000(b) -- --
Officer
Philip S. Smith................ 1995 347,556 75,000 -- -- 20,882(h)
Senior Vice President 1994 331,008 68,900 -- 236,738 19,309(h)
1993 316,500 80,000 -- -- 18,990(h)
Roger L. Galatas............... 1995 287,400 75,000 -- -- 17,244(h)
Senior Vice President 1994 275,004 61,700 -- 168,669 16,500(h)
1993 263,004 75,000 -- -- 15,780(h)
Allen J. Tarbutton, Jr. ....... 1995 286,008 75,000 -- -- 17,160(h)
Senior Vice President 1994 275,004 59,400 -- 126,750 16,500(h)
1993 263,004 75,000 -- -- 15,780(h)
</TABLE>
- ---------------
(a) In accordance with Securities and Exchange Commission regulations, no
amounts have been reported for perquisites and other personal benefits since
the aggregate value of such items provided to each named officer was less
than the lesser of 10% of his annual compensation or $50,000.
(b) Mr. Stevens assumed his current position with the Company on January 3,
1994. These options were granted to Mr. Stevens under the Company's 1989
Stock Option Plan at an exercise price equal to the fair market value of the
stock on the date of grant. Such options are exercisable within ten years
from the date of grant and vest over a five-year period.
(Notes continued on following page)
7
<PAGE> 10
(c) LTIP Payouts consist exclusively of cash payments under the Company's Bonus
Unit plans.
(d) For Mr. Mitchell, this consists of reimbursements paid him for the annual
premium on a $6,500,000 universal life insurance policy ($210,000), rentals
paid to him for business-related use of properties that he owns ($20,282)
(see "Certain Transactions") and directors' meeting attendance fees ($600).
(e) For Mr. Mitchell, this consists of reimbursements paid him for the annual
premium on a $6,500,000 universal life insurance policy ($210,000), rentals
paid to him for business-related use of properties that he owns ($72,535)
(see "Certain Transactions") and directors' meeting attendance fees ($600).
(f) For Mr. Mitchell, this consists of reimbursements paid him for two-years'
premiums on a $6,500,000 universal life insurance policy ($420,000), rentals
paid to him for business-related use of properties that he owns ($68,210)
(see "Certain Transactions") and directors' meeting attendance fees ($600).
(g) For Mr. Stevens, this consists of Thrift and Savings Plan contributions
($22,001) and directors' meeting attendance fees ($600).
(h) For the indicated amounts, this consists exclusively of Thrift and Savings
Plan contributions.
STOCK OPTION PLANS
Shown below is information with respect to the number of stock options and
stock appreciation rights ("SARs") exercised during fiscal 1995, the aggregate
dollar value realized upon exercise, the total number of unexercised options and
SARs, if any, held at January 31, 1995, and the aggregate dollar value of
in-the-money, unexercised options and SARs, if any, held at January 31, 1995.
AGGREGATED OPTION/SAR EXERCISES IN FISCAL 1995
AND YEAR-END OPTION/SAR VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED,
UNDERLYING UNEXERCISED IN-THE-MONEY
OPTIONS/SARS OPTIONS/SARS
SHARES AT JANUARY 31, 1995 AT JANUARY 31, 1995
ACQUIRED VALUE (#) ($)
ON EXERCISE REALIZED --------------------------- ---------------------------
NAME (#) ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ----------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
G. P. Mitchell(a)......... -- -- -- -- -- --
W. D. Stevens............. -- -- 20,000 100,000 -- --
P. S. Smith............... -- -- 15,000 -- 116,250 --
R. L. Galatas............. -- -- 14,500 6,000 82,125 --
A. J. Tarbutton, Jr. ..... -- -- 13,800 16,200 23,250 --
</TABLE>
- ---------------
(a) Mr. Mitchell does not participate in the Company's Stock Option Plans.
No stock options were granted to any of the named executive officers during
fiscal 1995.
8
<PAGE> 11
RETIREMENT PLAN
Eligibility for participation in the Company's qualified Retirement Plan is
extended to all employees (except those employees paid solely on a commission
basis and employees of the hospitality subsidiary of the Company), including
executive officers, on an equal basis, on each February 1 and August 1
immediately following the completion of one year of participation service.
Pension benefits are determined by final average annual compensation where
annual compensation is the sum of amounts shown in the columns labeled "Salary"
and "Bonus" in the Summary Compensation Table.
1995 PENSION PLAN TABLE FOR PROXY DISCLOSURE
<TABLE>
<CAPTION>
AVERAGE ANNUAL
COMPENSATION FOR
36 CONSECUTIVE ANNUAL RETIREMENT INCOME AT AGE 65 EXPRESSED AS A STRAIGHT LIFE ANNUITY
MONTHS IN LAST --------------------------------------------------------------------------------
120 MONTHS YEARS OF SERVICE
PRECEDING --------------------------------------------------------------------------------
RETIREMENT 10 15 20 25 30 35 40
- ------------------- -------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
$250,000......... $ 54,135 $ 81,203 $108,271 $108,271 $120,271 $140,316 $154,984
300,000......... 65,336 98,004 130,672 130,672 145,072 169,251 186,851
400,000......... 87,737 131,605 175,473 175,473 194,674 227,119 250,587
450,000......... 98,937 148,405 197,874 197,874 219,474 256,053 282,454
500,000......... 110,137 165,206 220,274 220,274 244,275 284,988 314,322
600,000......... 132,538 198,807 265,076 265,076 293,877 342,856 378,057
700,000......... 154,939 232,408 309,877 309,877 343,478 400,725 441,793
800,000......... 177,339 266,009 354,679 354,679 393,080 458,593 505,528
900,000......... 199,740 299,610 399,480 399,480 442,681 516,462 569,263
</TABLE>
Eligible employees will receive a retirement benefit equal to the greater
of the amounts computed under the following two benefit Formulas A and B upon
retirement. The monthly benefit payable under Formula A is equal to 1.65% times
average monthly compensation (defined as the average of the compensation
received in the 36 highest-paid consecutive calendar months in the last 10 years
of employment) plus 0.45% times average monthly compensation in excess of 150%
of covered compensation (defined as the average of Social Security Wage Bases
over the 35 years prior to the Social Security Retirement Age), such sum then
being multiplied by the lesser of years of credited service or twenty years. The
monthly benefit payable under Formula B is equal to 1.1% times average monthly
compensation plus .45% times average monthly compensation in excess of 100% of
covered compensation, such sum then being multiplied by years of credited
service. Under both formulas, accrued benefits are 100% vested after five years
of credited service.
The Employee Retirement Income Security Act of 1974 ("ERISA"), as amended
by the Tax Equity and Fiscal Responsibility Act of 1982 ("TEFRA") and the Tax
Reform Act of 1986, currently limits (i) the maximum benefits payable or
accruing under the Company's Retirement Plan and Thrift and Savings Plans on a
combined annual basis, (ii) the total benefit payable under the Retirement Plan
annually (currently $120,000), and (iii) the amount of compensation which can be
included for benefit calculation purposes
9
<PAGE> 12
(currently $150,000). The Company has adopted supplemental arrangements on a
non-qualified basis to provide that all employees be credited with the full
benefit accruing to such individuals under the Retirement Plan notwithstanding
such combined annual limitation, and to maintain for certain employees who may
be affected by the annual benefit limit (for fiscal 1995, George P. Mitchell,
Roger L. Galatas, Philip S. Smith, W. D. Stevens and Allen J. Tarbutton, Jr.)
total benefits upon retirement at approximately the levels shown in the table
set forth above.
Based on certain assumptions (which includes Board of Directors' approval),
illustrated above are the approximate annual benefits to which employees would
become entitled upon retirement at age 65 under the Retirement Plan and the
supplemental, non-qualified plans. The benefits set forth in the table reflect
the greater of the Plan's two formulas, are computed on a straight life annuity
basis, and would not be further reduced by Social Security income. For the
individuals named in the Summary Compensation Table of this Proxy Statement, the
credited years of service under the Retirement Plan, as of January 31, 1995, are
as follows: George P. Mitchell, 46 years; Roger L. Galatas, 16 years; Philip S.
Smith, 15 years; W. D. Stevens, 1 year; and Allen J. Tarbutton, Jr., 21 years.
Federal law requires that any active employee start receiving his/her
pension no later than the April 1 following the calendar year in which the age
70 1/2 is reached. Any such employee will continue to receive credit for any
additional service rendered after age 70 1/2. For fiscal 1995, George P.
Mitchell received pension payments from the Retirement Plan totaling $163,221
and payments from the supplemental non-qualified retirement plan of $316,722.
SUPPLEMENTARY LIFE INSURANCE AND OTHER AGREEMENTS
The Company has an agreement with Philip S. Smith whereby the Company will
pay to such officer or his estate an amount, up to a maximum of $250,000, upon
the death of such officer or his retirement at or after age 65, provided he is
still employed with the Company at his death or at age 65, whichever occurs
first. The Company has purchased life insurance policies on such officer's life
to insure against such risk. There was no cost to the Company for this policy
for fiscal 1995 as a result of the prior conversion of such policy to universal
life coverage.
SUPPLEMENTAL SURVIVING SPOUSE BENEFIT
The Company also has an agreement with George P. Mitchell, whereby the
Company will pay to Mr. Mitchell's surviving spouse, if any, a supplemental
surviving spouse benefit in the event that Mr. Mitchell dies while still
employed by the Company, or following termination of employment resulting from
total and permanent disability. Such supplemental surviving spouse benefit shall
be in an annual amount equal to the greater of (i) Mr. Mitchell's annual base
salary from the Company in effect at the time of his death or as of the date he
becomes totally and permanently disabled, or (ii) $625,000, and shall be payable
until the earlier to occur of (i) 36 monthly installments or (ii) the death of
such surviving spouse.
10
<PAGE> 13
SEVERANCE COMPENSATION
The Company has severance compensation agreements with Roger L. Galatas,
Philip S. Smith and Allen J. Tarbutton, Jr. The terms of the severance
agreements are invoked only in the event of a change of control (i.e., George P.
Mitchell no longer holds majority voting control of the Company). Generally, if
the executive is no longer employed in a substantially equivalent position and
being paid a salary at least equivalent to the salary being paid immediately
prior to the change of control ("Loss of Position"), the executive will receive
an amount monthly ($9,600 for Mr. Galatas; $11,250 for Mr. Smith; $9,600 for Mr.
Tarbutton) for 60 months following the Loss of Position. No payments for Loss of
Position due to a change of control shall be owed or paid to an executive after
he reaches the age of 66, or if he voluntarily severs employment with the
Company for any reason other than Loss of Position or if the Company discharges
such executive for cause.
BOARD COMPENSATION COMMITTEE REPORT
ON EXECUTIVE COMPENSATION
Notwithstanding anything to the contrary set forth in any of the Company's
previous filings under the Securities Act of 1933 or the Securities Exchange Act
of 1934 (the "Exchange Act") that might incorporate future filings, including
this Proxy Statement, in whole or in part, this Compensation Committee Report on
Executive Compensation and the Cumulative Shareholder Return Graph on page 15
shall not be incorporated by reference into any such filings.
REPORT OF THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS
The Compensation Committee of the Board of Directors (the "Committee") is
responsible for administering compensation programs for the Company's
executives. Responsibilities of the Committee include:
- Establishing policies with respect to compensation for executives;
- Determining pay levels for senior executives including all named
executive officers;
- Reviewing compensation levels for all other members of Company senior
management; and
- Setting and monitoring overall compensation programs and policies for the
Company's entire workforce.
The Committee is comprised of four non-employee directors.
Compensation Philosophy
The Company's overall compensation philosophy is to provide executives with
compensation opportunities which reflect:
- Overall Company performance relative to historical performance, Company
goals and objectives, and industry and national economic conditions;
11
<PAGE> 14
- Individual efforts and contributions to the overall success of the
Company;
- Competitive market pay levels and practices; and
- Internal fairness issues.
While the Committee considers pay levels and program practices of other
companies of similar size and operating characteristics, pay levels for the
Company's executives are necessarily a function of individual and Company
performance, including expected future financial and operating conditions.
The companies included in the industry groups in the Cumulative Shareholder
Return Graph at page 15 are not exclusively the same companies with which the
Company compares compensation practices and levels. By nature of the Company's
diversified business operations, it must consider such practices in the
Exploration and Production, Gas Services, and Real Estate industries in
evaluating competitive salaries for individual executives. In choosing the
companies with which to compare compensation levels and practices, the Company
considers those companies with whom it competes for executive talent in each
line of business.
Furthermore, during fiscal 1995 an independent compensation consulting firm
was retained to compare the Company's overall compensation program to the
programs offered by such comparable companies. The comparison revealed that the
Company's relative mix of compensation components differed from other companies
in that base salary is a larger proportion of the total, as contrasted to
bonuses and/or stock related awards. The committee concluded that an increased
portion of each executive's compensation should be "at risk" and thereby more
closely tied to Company performance. Specifically, the Committee directed that
base salaries for the executive group, including the named executives, should be
held at current levels while revised variable pay plans, such as bonus awards
and long-term incentives, are formulated. Transitional steps involving base
salaries and bonuses were implemented in February of 1995, while recommendations
with respect to long-term incentives are still under development.
In determining overall compensation, the Committee does not assign
quantitative weight to different factors or follow mathematical formulae.
Rather, the Committee exercises its discretion and makes a judgment after
considering the factors it deems relevant. A discussion of each of the key
elements of the Company's executive compensation program and the factors
considered in setting each element follows. In determining any one element, the
Committee necessarily considers the effect the element has on the total
compensation package.
[Note: Effective for tax years beginning on or after January 1, 1994,
Section 162(m) of the Internal Revenue Code limits the deductibility of certain
compensation paid to the CEO and to each of the four highest paid executive
officers who are employed at year end to $1 million per year. However, the
policy of this Committee is to establish and maintain a compensation program
which maximizes the creation of long-term shareholder value. In this regard, the
Committee is obligated to the Board and to the shareholders of the Company to
recognize and reward performance which increases the value of the Company.
Accordingly, the Committee will continue to exercise discretion in those
instances where a purely mechanical approach necessary under tax law
considerations would compromise the interests of shareholders.]
12
<PAGE> 15
Base Salaries
Base salaries for executive officer positions are determined in part by
competitive pay practices. Each year, the Company obtains information through
participation in industry specific executive compensation surveys conducted by
independent consultants. The Committee analyzes the survey information and makes
adjustments to reflect the Committee's assessment of individual performance,
experience and scope of responsibility.
BONUSES
Executives are eligible to receive annual bonuses based on the overall
performance of the Company, as well as individual contributions and performance.
Bonuses are designed to reward performance, and as such, are not guaranteed.
Awards are determined based on the Committee's assessment of performance.
Factors the Committee considers in its assessment include:
- Revenue;
- Divisional operating earnings;
- Net earnings; and
- Reserve replacement.
Bonuses are not based on specific achievement of predetermined criteria; rather
the Committee considers all of the above factors, as well as the current and
expected operating climate, when deciding on specific awards. This discretion
allows the Committee to utilize its judgment in granting awards it believes
truly reflect individual effort expended and the results these efforts produce.
For the named executives for fiscal 1995, a target percentage of salary was
established based on the average of available competitive data for similar
positions in comparable companies. In consideration of each of the above
factors, actual, annualized bonus amounts paid in fiscal 1995 ranged from 52% to
83% of said targets.
Long-Term Incentives
Long-term incentives are provided pursuant to the Company's Bonus Unit and
Stock Option Plans. Both plans provide a direct link between shareholder return
(through stock price appreciation) and long-term incentive compensation for
executives. Awards are granted on a periodic basis and at the sole discretion of
the Committee.
Bonus Unit Plan
For several years, Bonus Unit Plans have been a foundation of the Company's
long-term incentive program for executives. In addition to strengthening the
link between shareholders and executives, bonus units encourage executives to
focus on the long-term success of the Company. Bonus units are awarded at a
price equal to the price of the Company's stock on the date of grant. As the
price of the Company's stock increases, the value of the bonus units also
increases. If the price does not increase, the bonus units have no value. After
13
<PAGE> 16
the units vest, executives and other unit holders may redeem, in cash, any
appreciation in the value of the units. Any bonus units still outstanding at the
expiration date of the plan will be automatically redeemed.
The 1991 Bonus Unit Plan was approved by the Committee, and adopted by the
Board of Directors in December 1991. Bonus units authorized by the Plan vest in
equal installments over a five-year period, and expire at the end of six years.
The plan is unfunded and is administered by a committee (the "Bonus Unit Plan
Committee") composed of the Chairman and the Vice Chairman of the Board of
Directors who, like other directors, are not eligible to participate.
When determining awards, the Bonus Unit Plan Committee considers individual
and Company performance. Individual criteria include promotions, scope of
responsibility and organizational level. Bonus units were last awarded to the
named executives during fiscal 1992.
Stock Options
The Company also has utilized stock options as a method of aligning
shareholder and executive interests. The criteria for determining individual
awards are the same as that for bonus units. No stock options were granted in
fiscal 1995 to any of the named executives.
CEO Compensation
The Committee is also responsible for establishing pay levels for the CEO.
The compensation of the CEO reflects the same elements, and the Committee
considers the same factors described for the other executives in determining the
CEO's total compensation. A 1994 evaluation of Mr. Mitchell's total compensation
against competitive data revealed that his pay approximated the 50th percentile
of the total cash compensation of the CEOs of comparable companies. Mr.
Mitchell's bonus award for fiscal 1995 was determined in much the same manner as
the other named executives, with a target percentage of salary established based
on available competitive data. In consideration of all factors, the actual
amount paid to Mr. Mitchell was 44% of said target. Mr. Mitchell did not receive
an increase in base salary during fiscal 1995.
As the founder and majority owner of the Company, Mr. Mitchell has a
significant portion of his wealth invested in the Company's stock. His
significant stock ownership provides a strong incentive for Company management
to maximize shareholder value.
The Company provides supplemental life insurance to Mr. Mitchell through
reimbursement of premiums on an insurance policy maintained by Mr. Mitchell. Mr.
Mitchell is currently receiving distributions from the Company's pension plan
(as required by IRS regulations and based on previous contributions made on his
behalf). No additional contributions are being made on Mr. Mitchell's behalf to
the Company's Thrift and Savings Plan.
Mr. Robert W. Baldwin
Mr. William D. Eberle
Mr. Shaker A. Khayatt
Mr. M. Kent Mitchell
14
<PAGE> 17
CUMULATIVE SHAREHOLDER RETURN GRAPH
The following graph sets forth cumulative total shareholder return for the
Company's voting Common Stock, the Standard & Poor's 500 Stock Index ("S&P 500
Index") and the Dow Jones Oil-Secondary Index for the years indicated as
prescribed by the Securities and Exchange Commission's rules. The information
contained in this graph is not necessarily indicative of future Company
performance.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN*
AMONG MITCHELL ENERGY & DEVELOPMENT CORP., THE S&P 500 INDEX
AND THE DOW JONES OIL -- SECONDARY INDEX
<TABLE>
<CAPTION>
MITCHELL ENERGY
MEASUREMENT PERIOD & DEVELOPMENT DOW JONES OIL
(FISCAL YEAR COVERED) CORP. S & P 500 -SECONDARY
<S> <C> <C> <C>
1/90 100 100 100
1/91 85 108 88
1/92 77 133 86
1/93 90 147 92
1/94 116 166 104
1/95 92 167 93
</TABLE>
- ---------------
* Total return for each of the last five fiscal years ending January 31. Assumes
$100 was invested on January 31, 1990 in the Company's voting Common Stock or
in the indicated index and that dividends were reinvested as received.
15
<PAGE> 18
CERTAIN TRANSACTIONS
When the Company became a publicly owned corporation in 1972, it adopted a
policy that it would not permit its officers and directors to compete with the
Company in any manner and that it would not, on terms less favorable to the
Company than could have been arranged with an unaffiliated third party, enter
into any of the following transactions: (i) make loans to officers, directors or
stockholders and (ii) sell to or purchase from its officers or directors any
properties or interests therein. Management of the Company believes that all of
the transactions summarized below are in keeping with this established policy.
Prior to the time the Company became a publicly held corporation, George P.
Mitchell acquired interests in several oil and gas properties in which the
Company also owns interests and for which the Company is operator. The Company
distributes to Mr. Mitchell his share of the revenues and charges him for his
share of the costs and expenses associated with these oil and gas operations.
For fiscal 1995, Mr. Mitchell's indebtedness to the Company on these oil and gas
transactions and for other administrative services also represented by open
accounts may be summarized as follows:
<TABLE>
<S> <C>
Largest aggregate indebtedness at any time during the period......... $252,293
Amount outstanding at January 31, 1995............................... $ 76,547
Rate of interest paid or charged on overdue accounts, if any......... Chemical Bank
prime + 1%
</TABLE>
These accounts are settled on a regular basis in accordance with customary
business practices.
During fiscal 1993, Mr. Mitchell sold his existing interest in certain of
the oil and gas properties discussed in the preceding paragraph to Dolomite
Resources, Inc. ("Dolomite"), a company which is owned equally by each of his
ten children, including M. Kent Mitchell and J. Todd Mitchell. For fiscal 1995,
Dolomite's open account indebtedness to the Company related to these oil and gas
transactions may be summarized as follows:
<TABLE>
<S> <C>
Largest aggregate indebtedness at any time during the period......... $188,435
Amount outstanding at January 31, 1995............................... $175,249
Rate of interest paid or charged on overdue accounts, if any......... Chemical Bank
prime + 1%
</TABLE>
These accounts are settled on a regular basis in accordance with customary
business practices.
G. Scott Mitchell, an adult son of George P. Mitchell, through LifeForms,
Inc. ("LifeForms"), a company of which he is Secretary/Treasurer and in which he
and his brother M. Kent Mitchell have a 44% ownership interest and a 5%
ownership interest, respectively, during fiscal 1995 purchased 151 developed
lots for residential development in The Woodlands from a subsidiary of the
Company, at a total purchase price of $4,961,794. The price contracted for and
paid and the terms of payment for each lot were comparable to those paid to the
subsidiary by unrelated parties for similar lots in the same areas. Also during
fiscal 1995, LifeForms paid $207,757 toward The Woodlands' participative
builders' advertising program. In addition, LifeForms obtained construction
mortgage financing from Mitchell Mortgage Company, a wholly-owned subsidiary of
the Company, in an aggregate amount of $15,250,000, which loans bear interest at
an annual rate equal to two percent above the prevailing bank prime commercial
loan rate, plus an additional one percent fee paid on amounts drawn under such
loans. The outstanding principal amount of such loans was $2,393,000 as of
16
<PAGE> 19
January 31, 1995. Such advertising and financing arrangements with LifeForms are
similar to arrangements with other builders in The Woodlands.
During fiscal 1995, MBP Corp. and Eighteen Seventy Strand Corp.,
corporations wholly owned by George P. Mitchell, contracted with subsidiaries of
the Company for construction management services in connection with the
renovation and construction of properties owned by the corporations. The largest
aggregate amount of indebtedness outstanding at any time during fiscal 1995
related to such transactions was $153,052, of which $25,441 was outstanding as
of January 31, 1995. Such indebtedness was settled on a regular basis so no
interest was charged thereon.
In January 1994, the Company sold its joint venture interest in Pier 21, a
commercial development containing restaurants, shops and a hotel located in
Galveston, Texas, to its joint venture partner, MBP Corp., for $405,000, which
resulted in a gain of $100,000 for the Company. At such time the Company's 50%
guaranty of $4,875,000 of joint venture debt was released. At January 31, 1994 a
subsidiary of the Company had a $1,625,000 note receivable from the joint
venture for financing the initial acquisition of the project. This note was
repaid in full in March 1994.
During fiscal 1995, the Company incurred business promotion charges in the
amount of $97,350 at a hotel owned by a company of Mr. Mitchell's in connection
with the Galveston Mardi Gras celebration. Also in fiscal 1995, a subsidiary of
the Company assigned two employees on a full-time basis to provide supervision
for a ranch owned by Mr. Mitchell. Mr. Mitchell reimbursed the Company for the
salaries and benefit costs of these personnel in the aggregate amount of
$101,697. In addition, Mr. Mitchell acquired three lots in Galveston from a
subsidiary of the Company at an aggregate purchase price of $191,340.
The Company paid Mr. Mitchell rental reimbursements in the amount of
$20,282 during fiscal 1995 for lodging expenses when he is out-of-town on
Company-related business and for Company-related use of properties which he
owns.
Prior to the time the Company became a publicly-held corporation, Johnny
Mitchell, brother of George P. Mitchell, acquired interests in several oil and
gas properties in which the Company also owns interests and for which the
Company is the operator. For the period February 1, 1994 through January 31,
1995, Johnny Mitchell's open account indebtedness to the Company related to
these oil and gas interests may be summarized as follows:
<TABLE>
<S> <C>
Largest aggregate amount outstanding at any time during the period... $282,847
Amount outstanding at January 31, 1995............................... $ --
Rate of interest paid or charged on overdue accounts, if any......... Chemical Bank
prime +1%
</TABLE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
M. Kent Mitchell, a director of the Company and a member of the
Compensation Committee, has a 5% ownership interest in LifeForms and a 10%
ownership interest in Dolomite. See "Certain Transactions" for a discussion of
certain business transactions during fiscal 1995 between such companies and the
Company.
17
<PAGE> 20
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
Section 16 of the Exchange Act ("Section 16") requires that reports of
beneficial ownership of Common Stock and changes in such ownership be filed with
the Securities and Exchange Commission by the Company's directors and executive
officers. The Company is required to conduct a review and to identify in its
proxy statement each director or officer who failed to file any required reports
under Section 16 on a timely basis. Based upon that review, the Company has
determined that in March 1995, J. Todd Mitchell, a director of the Company, was
two days late in filing a Form 5 -- Annual Statement of Changes in Beneficial
Ownership reflecting shares of Common Stock of the Company he had received from
a trust. To the Company's knowledge, all other Section 16 reporting requirements
applicable to its other directors and executive officers were complied with for
fiscal 1995.
RELATIONSHIP WITH AND APPOINTMENT OF
INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors of the Company proposes the appointment of Arthur
Andersen LLP, independent public accountants, to audit the accounts of the
Company for the fiscal year ending January 31, 1996. If the stockholders do not
appoint Arthur Andersen LLP, the selection of independent public accountants
will be made by the Board of Directors, and Arthur Andersen LLP may at that time
be considered for such appointment.
Arthur Andersen LLP has served as the Company's independent public
accountants continuously since 1973. Representatives of Arthur Andersen LLP will
be present at the Annual Meeting of Stockholders and shall be accorded the
opportunity to make a statement if they so desire, and will also be available to
respond to appropriate questions from stockholders.
STOCKHOLDER PROPOSALS
To permit the Company and its stockholders to deal with stockholder
proposals in an informed and orderly manner, the Bylaws establish an advance
notice procedure with regard to the nomination (other than by or at the
direction of the Board of Directors) of candidates for election to the Board of
Directors and with regard to certain matters to be brought before an Annual
Meeting of Stockholders. In general, written notice must be received by the
Secretary of the Company not less than 20 days nor more than 60 days prior to
the meeting and must contain certain specified information concerning the person
to be nominated or the matters to be brought before the meeting as well as the
stockholder submitting the proposal. A copy of the applicable Bylaw provisions
may be obtained, without charge, upon written request to the Secretary of the
Company at the address set forth on page 1 of this Proxy Statement.
In order to be included in the proxy materials for the 1996 Annual Meeting,
stockholder proposals must be received by the Company on or before January 19,
1996.
18
<PAGE> 21
OTHER MATTERS
The Board of Directors does not intend to bring any matter before the
Annual Meeting other than those mentioned above. However, if any other matters
should be properly presented to the meeting for action by the stockholders or
should otherwise come before the meeting, it is intended that the holders of the
proxies with discretionary authority to vote on such other matters will vote
thereon in their discretion.
By Order of the Board of Directors,
THOMAS P. BATTLE
Secretary
May 19, 1995
19
<PAGE> 22
MITCHELL ENERGY & DEVELOPMENT CORP.
[LOGO]
NOTICE OF
ANNUAL MEETING
JUNE 28, 1995
AND
PROXY STATEMENT
<PAGE> 23
MITCHELL ENERGY & DEVELOPMENT CORP.
PROXY SOLICITED BY BOARD OF DIRECTORS FOR
ANNUAL MEETING OF STOCKHOLDERS TO BE HELD JUNE 28, 1995
The undersigned hereby appoints Bernard F. Clark and Thomas P. Battle,
or either of them, as Proxies, with power of substitution, and authorizes them,
or either of them, to represent the undersigned at the Annual Meeting of
Stockholders of Mitchell Energy & Development Corp. to be held on June 28,
1995, or any adjournment thereof, and to vote as follows the number of shares
which the undersigned would be entitled to vote if personally present.
This Proxy will be voted in accordance with your instructions or, if no
instructions are indicated, will be voted for the election of all nominees as
directors, in favor of the appointment of Arthur Andersen LLP as the Company's
independent public accountants, and in accordance with the discretion of the
person voting it with respect to any other business properly before the
meeting.
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE)
<PAGE> 24
/X/ PLEASE MARK
YOUR VOTES
AS THIS
-------------- ------------------
CLASS A COMMON UNEXCHANGED COMMON
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" ALL NOMINEES IN PROPOSAL NO. 1
AND "FOR" PROPOSAL NO. 2.
1. Election of Directors
FOR all nominees WITHHOLD AUTHORITY
listed (except as to vote for all
indicated to the contrary) nominees listed
Nominees: Robert W. Baldwin, Bernard F. Clark, William D. Eberle, Shaker A.
Khayatt, Ben F. Love, Walter A. Lubanko, George P. Mitchell, J. Todd Mitchell,
M. Kent Mitchell, W. D. Stevens, Raymond L. Watson and J. McDonald Williams.
To withhold authority to vote for any individual nominees, write that nominee's
name in the space provided below.
FOR AGAINST ABSTAIN
2. The appointment of Arthur
Andersen LLP as the Company's
independent public accountants
3. In their discretion, the Proxies are authorized to vote on such
other business as may properly come before the meeting
I PLAN TO ATTEND MEETING.
Please sign exactly as name appears below.
When signing as attorney, executor,
trustee, administrator, guardian, or
corporate official, please give your full
title as such.
Please sign, date and return the proxy
card promptly using the enclosed envelope.
Dated:______________________________, 1995
Signature_________________________________
Signature_________________________________
