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 ss.240.14a-11(c) or ss.240.14a-12
Magellan Petroleum Corporation
................................................................................
(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] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
................................................................................
2) Aggregate number of securities to which transaction applies:
................................................................................
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
................................................................................
4) Proposed maximum aggregate value of transaction:
................................................................................
5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any par 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:
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4) Date Filed:
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<PAGE>
October 17, 1997
1997 Annual Meeting of Stockholders
December 3, 1997
Dear Stockholder:
It's a pleasure for us to extend to you a cordial invitation to attend
the 1997 Annual Meeting of Magellan Petroleum Corporation at the Orlando Airport
Marriott, 7499 Augusta National Drive, Orlando, Florida 32822, Wednesday,
December 3, 1997 at 1:00 P.M.
While we are aware that most of our stockholders are unable personally
to attend the Annual Meeting, proxies are solicited so that each stockholder has
an opportunity to vote on all matters to come before the meeting. Whether or not
you plan to attend, please take a few minutes now to sign, date and return your
proxy in the enclosed postage-paid envelope. Regardless of the number of shares
you own, your vote is important.
Besides helping us conduct business at the annual meeting, there is
another reason for you to return your proxy vote card. Under the abandoned
property law of some jurisdictions, a stockholder may be considered "missing" if
that stockholder has failed to communicate with us in writing. The return of
your proxy vote card qualifies as written communication with us.
The Notice of Annual Meeting and Proxy Statement accompanying this
letter describe the business to be acted on at the meeting.
As in the past, members of management will review with you the
Company's results and will be available to respond to questions during the
meeting.
We look forward to seeing you at the meeting.
Sincerely,
/s/ James R. Joyce
James R. Joyce
President
<PAGE>
MAGELLAN PETROLEUM CORPORATION
149 Durham Road
Oak Park - Unit 31
Madison, CT 06443
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
December 3, 1997
NOTICE IS HEREBY GIVEN that the 1997 Annual Meeting of Stockholders of
MAGELLAN PETROLEUM CORPORATION, a Delaware Corporation (the "Company"), will be
held on Wednesday, December 3, 1997 at 1:00 P.M., local time at the Orlando
Airport Marriott, 7499 Augusta National Drive, Orlando, Florida 32822 for the
following purposes:
1. To elect two directors of the Company;
2. To ratify the appointment of independent auditors of the
Company for the fiscal year ending June 30, 1998; and
3. To act upon such other matters as may properly come before the
meeting or any adjournments or postponements thereof.
This notice and proxy statement and the enclosed form of proxy are
being sent to stockholders of record at the close of business on October 17,
1997 to enable such stockholders to state their instructions with respect to the
voting of the shares. Proxies should be returned to American Stock Transfer &
Trust Company, 40 Wall Street, 46th Floor, New York, NY 10269, in the reply
envelope enclosed.
By order of the Board of Directors,
Dated: October 17, 1997 Timothy L. Largay
Secretary
- - --------------------------------------------------------------------------------
RETURN OF PROXIES
WE URGE EACH STOCKHOLDER WHO IS UNABLE TO ATTEND THE MEETING TO VOTE BY PROMPTLY
SIGNING, DATING AND RETURNING THE ACCOMPANYING PROXY IN THE REPLY ENVELOPE
ENCLOSED.
- - --------------------------------------------------------------------------------
<PAGE>
MAGELLAN PETROLEUM CORPORATION
149 Durham Road
Oak Park - Unit 31
Madison, CT 06443
PROXY STATEMENT
GENERAL INFORMATION
This proxy statement is furnished to stockholders of Magellan Petroleum
Corporation, a Delaware corporation (the "Company"), in connection with the
solicitation of proxies by the Board of Directors for use at the Annual Meeting
of Stockholders to be held on Wednesday, December 3, 1997 at 1:00 P.M., local
time, at the Orlando Airport Marriott, 7499 Augusta National Drive, Orlando,
Florida 32822 and at any adjournments or postponements thereof. The notice of
meeting, proxy statement, and proxy are first being mailed to stockholders on or
about October 17, 1997. The proxy may be revoked at any time before it is voted
by (i) so notifying the Company in writing; (ii) signing and dating a new and
different proxy card of a later date; or (iii) voting your shares in person or
by your duly appointed agent at the meeting.
The persons named in the enclosed form of proxy will vote the shares of
Common Stock represented by said proxy in accordance with the specifications
made by means of a ballot provided in the proxy, and will vote the shares in
their discretion on any other matters properly coming before the meeting or any
adjournment or postponement thereof. The Board of Directors knows of no matters
which will be presented for consideration at the meeting other than those
matters referred to in this proxy statement.
The record date for the determination of stockholders entitled to
notice of and to vote at the meeting has been fixed by the Board of Directors as
the close of business on October 17, 1997. On that date, there were 24,944,995
outstanding shares of Common Stock of the Company, par value $.01 per share
("Common Stock"). Each outstanding share of Common Stock is entitled to one
vote.
PROPOSAL 1
ELECTION OF TWO DIRECTORS
In accordance with the Company's By-Laws, two directors are to be
elected to hold office for terms of three years each, expiring with the 2000
Annual Meeting of Stockholders. The Company's By-Laws provide for three classes
of directors who are to be elected for terms of three years each and until their
successors shall have been elected and shall have been duly qualified. Both
nominees are currently directors of the Company. If no one candidate for a
directorship receives the affirmative vote of a majority of both the shares
voted and of the stockholders present in person or by proxy and voting thereon,
then the candidate who receives the majority in number of the stockholders
present in person or by proxy and voting thereon, shall be elected. The persons
named in the accompanying proxy will vote properly executed proxies for the
election of the persons hereinafter named, unless authority to vote for either
or both nominees is withheld.
<PAGE>
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS
VOTE "FOR" THE ELECTION OF THE NOMINEES.
The following table sets forth certain information about each nominee
for director and each director whose term of office continues beyond the 1997
Annual Meeting. The information presented includes, with respect to each such
person, his business history for at least the past five years; his age as of the
date of this proxy statement; his other directorships, if any; his other
positions with the Company, if any; and the year during which he first became a
director of the Company.
<TABLE>
<CAPTION>
Other
Director Offices Held
Name Since with Company Age and Business Experience
Nominees for three year terms expiring at the 2000 Annual Meeting:
<S> <C> <C> <C>
Walter McCann 1983 Audit Committee Mr. Walter McCann has been the President of
Richmond College, The American International
University, located in London, England, since
January 1993. Mr. McCann was elected a director
of Magellan Petroleum Australia Limited ("MPAL"),
the Company's majority owned subsidiary, on
September 2, 1997. From 1985 to 1992, he was
President of Athens College in Athens, Greece.
He was the Dean of the Barney School of Business
and Public Administration, University of Hartford
from 1979 to 1985. He is a member of the Bars of
Massachusetts and the District of Columbia. Age
sixty.
Ronald P. Pettirossi 1997 Audit Committee Mr. Ronald P. Pettirossi was elected on April 24,
1997 to fill the vacancy created by Mr. C. Dean
Reasoner's resignation on March 11, 1997.
Mr. Pettirossi has been the Chief Financial
Officer of Discas, Inc. since February 1997.
Discas, Inc. is a Waterbury, Connecticut based
proprietary plastic and rubber compounds
manufacturer. Mr. Pettirossi is a former audit
partner of Ernst & Young LLP, who has worked with
public and privately held companies for 31
years. Age fifty-four.
<PAGE>
Directors continuing in office with terms expiring at the 1998 Annual Meeting:
Dennis D. Benbow 1985 None Mr. Dennis D. Benbow has been the General Manager
of MPAL since July 7, 1993. He had served as
Operations Manager of MPAL from 1980 until his
election as General Manager. He has been a
director of MPAL since 1983. Age fifty-eight.
Benjamin W. Heath 1957 None Mr. Benjamin W. Heath was President of the
Company from 1957 until he retired from that
position on June 30, 1993. He continues to be
President and a director of Coastal Caribbean
Oils & Minerals, Ltd. ("Coastal Caribbean"), a
director of Canada Southern Petroleum Ltd.
("Canada Southern") and was Chairman of the Board
of MPAL until September 2, 1997. Age
eighty-three.
Directors continuing in office with terms expiring at the 1999 Annual Meeting:
James R. Joyce 1993 President and Chief Mr. James R. Joyce has been President since
Financial Officer July 1, 1993 and Chief Financial Officer since
January 1990. Mr. Joyce has been President of
G&O'D INC since July 1, 1994, a firm which
provides accounting and administrative services,
office facilities and support staff to the Company
and other clients. He had been Vice President of
G&O'D INC from 1979 until June 1994. Mr. Joyce has
been Treasurer of Coastal Caribbean since June
1994. Age fifty-six.
Timothy L. Largay 1996 Secretary Timothy L. Largay has been a partner in the law
firm of Murtha, Cullina, Richter and Pinney
("Murtha Cullina"), Hartford, Connecticut since
1974. He served as a director and Chairman of
the Board of Raymond Engineering, Inc., a
publicly held defense contractor, from 1984-1986
and as a director of Buell Industries, Inc., a
publicly held manufacturer from 1976-1990. On
October 1, 1997, Mr. Largay was elected a
director of Canada Southern. Murtha Cullina has
been retained by the Company for more than five
years and is being retained during the current
year. Age fifty-four.
</TABLE>
- - -----------------
* All of the named companies are engaged in oil, gas or mineral exploration
and/or development, except where noted.
All officers are elected annually and serve at the pleasure of the
Board of Directors. No family relationships exist between any of the directors
or officers.
<PAGE>
COMMITTEES
The only standing committee of the Board is the Audit Committee, of
which Messrs. McCann and Pettirossi are the sole members. The principal
functions of the Audit Committee are: (1) to meet or otherwise communicate with
the Chief Financial Officer and those assisting him and request these
individuals to undertake such projects and provide such information as the Audit
Committee deems appropriate; (2) to approve the engagement or discharge of the
Company's independent auditors, meet with such auditors at least twice a year
and scrutinize their performance; (3) to require documentation relating to
periodic reports, statements and filings with regulatory agencies to determine
that appropriate review of such material has been made, as provided in the
Company's policies, by qualified individuals such as outside legal counsel,
independent auditors, the Chief Executive Officer, and other individuals as
necessary; (4) to require counsel regularly to advise the Committee as to
current legal requirements applicable to the Company; and (5) to report
regularly to the Board as to the Company's accounting policies and procedures
and compliance therewith.
The Board has no standing nominating, compensation or stock option
committees. The functions that would be performed by such committees are
performed by the full Board.
Five meetings of the Board and two meetings of the Audit Committee were
held during the year ended June 30, 1997. No director attended less than 75% of
the aggregate number of meetings held by the Board and the committee on which he
served.
<PAGE>
ADDITIONAL INFORMATION
CONCERNING DIRECTORS AND EXECUTIVE OFFICERS
Executive Compensation
The following table sets forth certain summary information concerning
the compensation of Mr. James R. Joyce, who is President and Chief Executive
Officer of the Company, and each of the most highly compensated executive
officers of the Company who earned in excess of $100,000 during fiscal year 1997
(collectively, the "Named Executive Officers").
<TABLE>
<CAPTION>
========================================================================================================
Summary Compensation Table
- - --------------------------------------- -------------------------- ------------------- -----------------
Long Term
Compensation All Other
Annual Compensation Awards Compensation
($)
- - --------------------------------------- ------------- ------------ ------------------- -----------------
Name and Fiscal Salary Options/SARs
Principal Position Year ($) (#)
- - --------------------------------------- ------------- ------------ ------------------- -----------------
<S> <C> <C> <C> <C>
James R. Joyce (1) 1997 - - -
President, Chief Financial Officer 1996 - - -
and a director of the Company 1995 - - -
- - --------------------------------------- ------------- ------------ ------------------- -----------------
Dennis D. Benbow (2) 1997 189,015 - 10,449
Director and General Manager - MPAL 1996 178,185 - 10,243
1995 167,332 - 8,895
========================================================================================================
</TABLE>
(1) Fees paid to G&O'D INC for Mr. Joyce's services and related overhead in
fiscal years 1997, 1996 and 1995 were $148,588, $123,700 and $139,100,
respectively. It is expected that G&O'D INC will continue to receive fees for
providing accounting and administrative services, office facilities and support
staff provided to the Company by G&O'D INC, and that Mr. Joyce will receive no
additional compensation or other direct benefits from the Company for serving as
President and Chief Financial Officer and a director of the Company. See
"Certain Business Relationships and Transactions" below.
(2) Mr. Benbow has an employment contract with MPAL that is effective for a term
of three years beginning January 1, 1995. Mr. Benbow's salary is subject to an
annual adjustment for changes in the Australian Consumer Price Index. In the
event that Mr. Benbow is terminated by MPAL prior to December 31, 1997, without
cause, he will be entitled to the balance of his unpaid salary for the remaining
period of the employment agreement. MPAL has a termination policy applicable to
all MPAL employees which provides for three weeks of pay for each year of
service up to a maximum 52 weeks of salary. This policy would also apply to Mr.
Benbow, if such termination payment were greater than the amount due under his
employment agreement.
Defined Benefit or Actuarial Plan Disclosure
Under the terms of MPAL's funded pension plan, Mr. Benbow will receive
a lump sum payment from an insurance carrier upon his retirement which will be a
multiple of 4.6 times the average of his basic salary for his highest average
salary over three consecutive years. Based on Mr. Benbow's annual average salary
for the three years ended June 30, 1997, such lump sum payment would have been
$580,000, if he were eligible to retire or in the event of his death or
disability at that date.
<PAGE>
Mr. Joyce is not covered by any pension plan funded by the Company.
Messrs. Benjamin W. Heath, Timothy L. Largay, Walter McCann and
Ronald P. Pettirossi are each paid director's fees of $25,000 per annum.
Mr. Heath receives a reimbursement of $500 per month for office and
secretarial expenses from the Company. Mr. Heath also received a similar
reimbursement of $833 per month from MPAL, in his capacity as Chairman.
Under the Company's medical reimbursement plan for all outside
directors, the Company reimburses certain directors the cost of their medical
premiums, up to $500 per month. During fiscal 1997, the cost of this plan was
$6,000.
Stock Options
The following table provides information about stock options exercised
during fiscal 1997 and unexercised stock options held by the Named Executive
Officers at the end of fiscal year 1997.
<TABLE>
<CAPTION>
======================================================================================================================
Aggregated Option/SAR Exercises in Fiscal 1997 and June 30, 1997
Option/SAR Values Table
----------------------- ------------------ --------------- ---------------------------- -----------------------------
Value of
Number of Unexercised
Securities Unexercised In-The-Money
Underlying Options/SARs Options/SARs
Options/SARs Value at 1997 Year-end (#) at 1997 Year-end ($)
----------------------- ------------- --------------- -------------- --------------
Name On Exercise (#) Realized ($) Exercisable Unexercisable Exercisable Unexercisable
------------------ --------------
----------------------- ------------- --------------- -------------- --------------
<S> <C> <C> <C> <C> <C> <C>
James R. Joyce - - 100,000 - 156,000 -
----------------------- ------------------- -------------- ------------- --------------- -------------- --------------
Dennis D. Benbow 43,750 104,000 50,000 - 78,000 -
======================================================================================================================
</TABLE>
Compensation Committee Interlocks and Insider Participation
The only officers or employees of the Company or any of its
subsidiaries, or former officers or employees of the Company of any of its
subsidiaries, who participated in the deliberations of the Board concerning
executive officer compensation during the fiscal year ended June 30, 1997 were
Messrs. Benjamin W. Heath, Dennis B. Benbow and James R. Joyce. At the time of
such deliberations, Messrs. Heath, Benbow and Joyce were directors of the
Company and MPAL. None of the above individuals participated in any discussions
or deliberations regarding their own compensation.
<PAGE>
Compensation Committee Report
The Company does not maintain a compensation committee; compensation
decisions are made by the Board of Directors as a whole. The compensation of
each of the Company's executive officers over the past several years has been
determined as discussed below. In establishing compensation, the Company has
considered the value of the services rendered, the skills and experience of each
executive officer, the Company's circumstances and other factors. The Board did
not establish specific guidelines governing last year's compensation for
executive officers, and there was no specific relationship between corporate
performance and the compensation of executive officers in the fiscal year ended
June 30, 1997.
Mr. Benbow's compensation was determined by the independent directors
of MPAL. Consistent with its usual practice on compensation of MPAL employees,
the Board of Directors of the Company did not intervene in that determination.
The Company has for several years maintained an arrangement with G&O'D, INC
whereby G&O'D, INC is compensated for its services on an hourly basis, including
Mr. Joyce's services in fiscal 1997 as President and Chief Financial Officer of
the Company. Statements for such services were submitted to the Company's
directors for review and approval. The Company had no other executive officers
in fiscal 1997.
Dennis D. Benbow Timothy L. Largay
Benjamin W. Heath Walter McCann
James R. Joyce Ronald P. Pettirossi
Tax Deductibility of Compensation
At this time, The Company does not expect that it will comply with the
Revenue Reconciliation Act of 1993 regarding executive compensation for the
following reasons:
1. It is not likely that compensation to any executive will
exceed $1 million.
2. The only executive officer receiving a salary is paid by MPAL,
which is a foreign corporation not subject to taxation in the
United States.
Compliance with Section 16(a) of the Securities Exchange Act of 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's executive officers, directors and persons who beneficially own more
than 10% of the Company's Common Stock to file initial reports of beneficial
ownership and reports of changes in beneficial ownership with the Securities and
Exchange Commission (the "SEC"). Such persons are required by the SEC
regulations to furnish the Company with copies of all Section 16(a) forms filed
by such persons. Based solely on its copies of forms received by it, or written
representations from certain reporting persons that no Form 5's were required
for those persons, the Company believes the during the just completed fiscal
year, its executive officers, directors, and greater than 10% beneficial owners
compiled with all applicable filing requirements except that Timothy L. Largay
inadvertently failed to timely file his purchase of 3,000 shares of the
Company's stock in October 1996.
<PAGE>
Certain Business Relationships and Transactions
G&O'D INC
During the year ended June 30, 1997, $221,088 was paid or accrued for
providing accounting and administrative services, office facilities and support
staff to the Company by G&O'D INC ("G&O'D"), a firm that is owned by Mr. James
R. Joyce, President and Chief Financial Officer. The services rendered by G&O'D
to the Company include the following: preparation and filing of all reports
required by Federal and State governments, preparations of reports and
registration statements required under the Federal securities laws; preparation
and filing of interim, special and annual reports to Stockholders; maintaining
corporate ledgers and records; furnishing office facilities and record
retention. G&O'D is also responsible for the investment of The Company's
available funds and other banking relations and securing adequate insurance to
protect the Company. G&O'D is responsible for the preparation and maintenance of
all the minutes of any directors' and stockholders' meetings, arranging all
meetings of directors and stockholders, coordinating the activities and services
of all companies and firms rendering services to the Company, responding to
stockholder inquiries, and such other services as may be requested by the
Company. G&O'D maintains and provides current information about the Company's
activities so that the directors of the Company may keep themselves informed as
to the Company's activities. G&O'D's fees are based on the time spent in
performing these services to the Company.
Royalty Interests.
Mr. Benjamin W. Heath has overriding royalty interests on certain oil
and gas properties in which the Company also has interests. These royalties were
received directly or indirectly from the Company:
Benjamin W. Heath
Property Royalty
Amadeus Basin, Australia:
Dingo .1285469% (*) and .0770625%
Palm Valley .1480469% (*) and .1758125%
Mereenie .1187969% (*) and .0276875%
Kotaneelee gas field, Canada .128% (*)
(*) Held by a marital trust in which Mr. Heath has a 54.4% income
interest.
Mr. Heath received (directly and indirectly) gross royalty payments of
$54,252, with respect to his royalty interests during the year ended June 30,
1997. These amounts represent payments by all of the owners of the fields, and
not just the Company's share. Mr. Heath received these royalty interests between
1957 and 1968, prior to any oil and gas discoveries.
<PAGE>
Security Ownership of Management
The following table sets forth information as to the number of shares
of the Company's Common Stock owned beneficially as of October 1, 1997 by each
director and each Named Executive Officer listed in the Summary Compensation
Table and by all directors and executive officers of the Company as a group:
<TABLE>
<CAPTION>
Amount and Nature of
Name of Individual or Group Beneficial Ownership* Percent of Class
Shares Options
<S> <C> <C> <C>
Dennis D. Benbow 32,000 50,000 **
Benjamin W. Heath 20,000 - **
James R. Joyce 66,000 100,000 **
Timothy L. Largay 3,000 50,000 **
Walter McCann 14,368 87,500 **
Ronald P. Pettirossi 1,500 - **
Directors and Executive Officers as a
Group (a total of 6) 136,868 287,500 1.7%
</TABLE>
* Unless otherwise indicated, each person listed has the sole power to vote
and dispose of the shares listed.
** The percent of class owned is less than 1%.
PROPOSAL 2
RATIFICATION OF APPOINTMENT OF AUDITORS
The Board of Directors has appointed Ernst & Young LLP as the Company's
independent auditors for the fiscal year ending June 30, 1998. Ernst & Young LLP
and its predecessor have been the Company's independent auditors for many years.
Although ratification by stockholders is not required by law, the Board requests
that stockholders ratify this appointment. The proxy permits a stockholder to
vote for, to vote against, or to abstain from voting for the ratification of the
appointment of auditors. If no specification is indicated, the shares will be
voted in favor of ratifying the appointment of Ernst & Young LLP. If
ratification is not obtained, the Board will reconsider the appointment.
Representatives of Ernst & Young LLP will not be present at the Annual Meeting.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS
VOTE "FOR" PROPOSAL 2.
OTHER MATTERS
If any other matters are properly presented to stockholders for a vote
at the meeting, the persons named as proxies on the proxy card will have
discretionary authority, to the extent permitted by law, to vote on such matters
in accordance with their best judgment. The Board of Directors knows of no other
matters which will be presented to stockholders for consideration at the meeting
other than the matters referred to in Proposals 1 and 2 above.
<PAGE>
VOTE REQUIRED FOR APPROVAL
Each outstanding share of Common Stock is entitled to one vote. Article
Twelfth of the Company's Certificate of Incorporation provides that:
Any matter to be voted upon at any meeting of stockholders
must be approved, not only by a majority of the shares voted at such
meeting (or such greater number of shares as would otherwise be
required by law or this Certificate of Incorporation), but also by a
majority of the stockholders present in person or by proxy and entitled
to vote thereon; provided, however, except and only in the case of the
election of directors, if no candidate for one or more directorships
receives both such majorities, and any vacancies remain to be filled,
each person who receives the majority in number of the stockholders
present in person or by proxy and voting thereon shall be elected to
fill such vacancies by virtue of having received such majority. When
shares are held by members or stockholders of another company,
association or similar entity and such persons act in concert, or when
shares are held by or for a group of stockholders whose members act in
concert by virtue of any contract, agreement or understanding, such
persons shall be deemed to be one stockholder for the purposes of this
Article.
The Company may require brokers, banks and other nominees holding shares for
beneficial owners to furnish information with respect to such beneficial owners
for the purpose of applying the last sentence of Article Twelfth.
Only stockholders of record are entitled to vote; beneficial owners of
Common Stock of the Company whose shares are held by brokers, banks and other
nominees (such as persons who own shares in "street name") are not entitled to a
vote for purposes of applying the provision relating to the vote of a majority
of stockholders. Each stockholder of record is considered to be one stockholder,
regardless of the number of persons who might have a beneficial interest in the
shares held by such stockholder. For example, assume XYZ broker is the
stockholder of record for ten persons who each beneficially own 100 shares of
the Company, eight of these beneficial owners direct XYZ to vote in favor of a
proposal and two direct XYZ to vote against the proposal. For purposes of
determining the vote of the majority of shares, 800 shares would be counted in
favor of the proposal and 200 shares against the proposal. For purposes of
determining the vote of a majority of stockholders, one stockholder would be
counted as voting in favor of the proposal.
The holders of thirty-three and one third percent (33 1/3%) of the total
number of shares entitled to be voted at the meeting, present in person or by
proxy, shall constitute a quorum for the transaction of business. In counting
the number of shares voted, broker nonvotes and abstentions will not be counted
and will have no effect. In counting the number of stockholders voting, (i)
broker nonvotes will have no effect and (ii) abstentions will have the same
effect as a negative vote or, in the case of the election of directors, as a
vote not cast in favor of the nominee.
<PAGE>
PERFORMANCE GRAPH
The graph below compares the cumulative total returns, including
reinvestment of dividends, if applicable, of Company Stock with companies in the
NASDAQ Index and an Industry Group Index (Media General's Oil, Natural Gas
Production Industry Group).
The chart displayed below is presented in accordance with SEC
requirements. Stockholders are cautioned against drawing any conclusions from
the data contained therein, as past results are not necessarily indicative of
future performance.
<TABLE>
<CAPTION>
1992 1993 1994 1995 1996 1997
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Magellan Petroleum 100 172.73 100.00 281.82 363.64 331.83
Industry Index 100 113.87 118.37 103.71 158.96 179.61
Brood Market 100 122.76 134.61 157.88 198.73 239.40
</TABLE>
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The Company knows of no person that owns beneficially more than 5% of
the outstanding common stock of the Company.
SOLICITATION OF PROXIES
The entire expense of preparing and mailing this Proxy Statement and
any other soliciting material (including, without limitation, costs, if any,
related to advertising, printing, fees of attorneys, financial advisors and
solicitors, public relations, transportation and litigation) will be borne by
the Company. In addition to the use of the mails, proxies may be solicited by
the Company or certain of its employees by telephone, telegram and personal
solicitation; however, no additional compensation will be paid to those
employees in connection with such solicitation. In addition, the Company has
retained the firm of Morrow & Co., to assist in the distribution of proxy
solicitation materials for an estimated fee of $6,500 plus out-of-pocket
expenses. The cost of the proxy solicitation will be borne by the Company.
Banks, brokerage houses and other custodians, nominees and fiduciaries
will be requested to forward solicitation material to the beneficial owners of
the Common Stock that such institutions hold of record, and the Company will
reimburse such institutions for their reasonable out-of-pocket disbursements and
expenses.
STOCKHOLDER PROPOSALS
Stockholders who intend to have a proposal included in the notice of
meeting and related proxy statement relating to the Company's 1998 Annual
Meeting of Stockholders must submit the proposal by June 18, 1998.
<PAGE>
Article II, Section 2.1, of the Company's By-Laws provides in part that,
At an annual meeting of the stockholders, only such business shall be
conducted as shall have been properly brought before the meeting. To be properly
brought before an annual meeting, business must be (a) specified in the notice
of meeting (or any supplement thereto) given by or at the direction of the board
of directors, (b) otherwise properly brought before the meeting by or at the
direction of the board of directors, or (c) otherwise properly brought before
the meeting by a stockholder. For business to be properly brought before an
annual meeting by a stockholder, the stockholder must have given timely notice
thereof in writing to the Secretary of the corporation. To be timely, a
stockholder's notice must be delivered to or mailed and received at the
principal executive offices of the corporation, not less than sixty (60) days
nor more than ninety (90) days prior to the meeting; provided, however, that in
the event that less than seventy days' notice or prior public disclosure of the
date of the meeting is given or made to stockholders, notice by the stockholder
to be timely must be so received not later than the close of business on the
tenth day following the date on which such notice of the date of the annual
meeting was mailed or such public disclosure was made. For purposes of this
Section 2.1, public disclosure shall be deemed to have been made to stockholders
when disclosure of the date of the meeting is first made in a press release
reported by the Dow Jones News Services, Associated Press, Reuters Information
Services, Inc. or comparable national news service or in a document publicly
filed by the corporation with the Securities and Exchange Commission pursuant to
Sections 13, 14 or 15(d) of the Securities Exchange Act of 1934, as amended.
A stockholder's notice to the Secretary shall set forth as to each
matter the stockholder proposes to bring before the annual meeting
(a) a brief description of the business desired to be brought before
the annual meeting and the reasons for conducting such business at the annual
meeting;
(b) the name and address, as they appear on the corporation's books, of
the stockholder intending to propose such business;
(c) the class and number of shares of the corporation which are
beneficially owned by the stockholder;
(d) a representation that the stockholder is a holder of record of
capital stock of the corporation entitled to vote at such meeting and intends to
appear in person or by proxy at the meeting to present such business;
(e) any material interest of the stockholder in such business.
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No stockholder has submitted a proposal for the 1997 Annual Meeting of
Stockholders which complied with the above requirements.
All stockholder proposals should be submitted to the Secretary of
Magellan Petroleum Corporation at 149 Durham Road, Oak Park - Unit 31, Madison,
CT 06443. The fact that a stockholder proposal is received in a timely manner
does not insure its inclusion in the proxy material, since there are other
requirements in the Company's By-Laws and proxy rules relating to such
inclusion.
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. THEREFORE,
STOCKHOLDERS WHO DO NOT EXPECT TO ATTEND THE MEETING IN PERSON ARE URGED TO
SIGN, DATE AND RETURN THE ENCLOSED PROXY IN THE REPLY ENVELOPE PROVIDED.
BY ORDER OF THE BOARD OF DIRECTORS
Timothy L. Largay
Secretary
Dated: October 17, 1997
