SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
(Amendment No. )
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Check the appropriate box:
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Rule 14a-6(e)(2))
[ X ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Sections 240.14a-11(c) or
Section 240.14a-12
MAYNARD OIL COMPANY
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement,
if other than the Registrant)
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<PAGE>
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MAYNARD OIL COMPANY
8080 N. Central Expressway
Suite 660
Dallas, Texas 75206
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To be Held May 21, 1997
The annual meeting of stockholders of MAYNARD OIL COMPANY will be held on
Wednesday, May 21, 1997, at 9:30 A.M., Dallas Time, at the offices of the
Company, 8080 N. Central Expressway, Suite 660, Dallas, Texas, for the following
purposes:
1. To elect three directors to hold office in accordance with the
Company's Certificate of Incorporation, as amended, until the 1998 Annual
Meeting of Stockholders, or until their successors shall be duly elected.
2. To transact such other business as may properly come before the
meeting or any adjournment thereof.
The Board of Directors has fixed the close of business on April 7, 1997, as
the record date for determination of stockholders entitled to notice of and to
vote at the meeting.
Please sign, date and return the accompanying Proxy in the enclosed
envelope which requires no postage if mailed in the United States. All
stockholders of the Company are invited to attend the meeting in person.
By order of the Board of Directors
Linda K. Burgess
Secretary and Controller
Dallas, Texas
April 16, 1997
YOUR VOTE IS IMPORTANT. TO VOTE YOUR SHARES, PLEASE COMPLETE, SIGN AND DATE
THE ENCLOSED PROXY CARD AND MAIL IT PROMPTLY IN THE ENCLOSED ENVELOPE.
PROXY STATEMENT
MAYNARD OIL COMPANY
ANNUAL MEETING OF STOCKHOLDERS
May 21, 1997
GENERAL INFORMATION
This Proxy Statement is furnished to stockholders of Maynard Oil Company on
or about April 16, 1997, in connection with the solicitation of proxies for use
at the annual meeting of stockholders of the Company to be held on May 21, 1997,
at the time and place and for the purposes set forth in the accompanying Notice
of the meeting.
THE ACCOMPANYING PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
THE COMPANY AND IS REVOCABLE AT ANY TIME PRIOR TO BEING VOTED. All shares of
the Company's Common Stock, par value $.10, represented by properly executed and
unrevoked proxies will be voted, if the proxies are received in time for the
meeting. Any Stockholder giving a proxy has the right to revoke it at any time
before the proxy is exercised by giving notice to the Company in writing or in
open meeting.
The Company will bear the cost of solicitation of the proxies. In addition
to solicitation by mail, certain directors, officers and other employees of the
Company, not specifically employed for the purpose, may solicit proxies, without
additional remuneration therefor, by personal interview, mail, telephone or
telegraph. The Company may also reimburse brokers or other persons holding
shares in their name, or in the names of nominees, for expenses in sending proxy
material to principals and obtaining their proxies.
Each holder of Common Stock of record at the close of business on April 7,
1997, is entitled to one vote per share on all matters to come before the
meeting. Cumulative voting is not permitted under the Company's Certificate of
Incorporation and By-Laws. At the close of business on April 7, 1997, there
were outstanding and entitled to vote at the meeting 4,889,450 shares of Common
Stock. A majority of the outstanding shares must be represented at the meeting
in person or by proxy in order to have a quorum to conduct business at the
meeting.
A stockholder may, with respect to the election of directors, (I) vote for
all nominees named herein, (ii) withhold authority to vote for all such nominees
or (iii) vote for all such nominees other than any nominee with respect to whom
the stockholder withholds authority to vote. The nominees receiving the highest
number of votes cast for the number of positions to be filled shall be elected.
Accordingly, withholding authority to vote for a director nominee will not
prevent him from being elected. On any other matter which may properly come
before the meeting, the affirmative vote of the holders of a majority of the
shares represented in person or by proxy at the meeting and entitled to vote is
required. Broker non-votes will have no effect on any matter at the meeting.
PRINCIPAL STOCKHOLDERS
James G. Maynard (whose address is 9933 Lawler Avenue, Suite 344, Skokie,
Illinois, 60077, and whose shareholdings are shown below), Dimensional Fund
Advisors, Inc. ("Dimensional"), a registered investment advisor, located at 1299
Ocean Avenue, 11th Floor, Santa Monica, CA 90401, and Ryback Management
Corporation/Lindner Investment Series Trust ("Lindner") located at 7711
Carondelet, Box 16900, St. Louis, MO 63105, are the only persons known to the
Company to be the beneficial owners of more than 5% of the outstanding Common
Stock of the Company.
As set forth in the table below, Dimensional is deemed to have beneficial
ownership of 354,800 shares of Common Stock as of April 7, 1997. All of such
shares are held in portfolios of DFA Investment Dimensions Group Inc., a
registered open-end investment company, or the DFA Investment Trust Company, a
Delaware business trust, or the DFA Group Trust and DFA Participation Group
Trust, investment vehicles for qualified employee benefit plans.
In addition, Lindner is deemed to have beneficial ownership of 512,700
shares of Common Stock as of April 7, 1997. Of the above referenced shares,
97,000 are managed by Ryback Management Corporation, a registered investment
company adviser, and 415,700 shares are held by Lindner Growth Fund, a
registered investment company.
The following table shows with respect to each director and nominee for
director of the Company, each 5% stockholder, each executive officer named in
the Summary Compensation Table below, and with respect to all directors and
executive officers as a group: (I) the total number of shares of Common Stock
beneficially owned as of April 7, 1997, and (ii) the percent of the total number
of shares of Common Stock outstanding as of that date:
Amount and
Name of Nature of Percent
Beneficial Beneficial of
Owner Ownership(1) Class
---------- ------------ ------
James G. Maynard 2,756,596(2) 56.38
Ryback Management
Corporation/ Lindner
Investment Series Trust 512,700 10.49
Dimensional Fund
Advisors, Inc 354,800 7.26
Robert B. McDermott 5,000 0.10
Ralph E. Graham 2,200 0.04
Glenn R. Moore -- --
L. Brent Carruth -- --
Kenneth W. Hatcher -- --
All directors and executive
officers as a group (6 persons) 2,763,796 56.53
- ------------------------
(1) In accordance with regulations of the Securities and Exchange Commission,
stock ownership reflects shares with respect to which the director,
nominee, principal stockholder or executive officer has voting power or
investment power, or has a right to acquire such power. Each director,
nominee, principal stockholder or executive officer has both sole voting
power and sole investment power with respect to the shares set forth in the
table. Beneficial ownership is disclaimed by each director, nominee,
principal stockholder or executive officer of shares listed of which he or
it would not, but for Rule 13d-3 under the Securities Exchange Act of 1934,
be deemed to be the beneficial owner.
(2) Includes 300,000 shares held of record by a corporation controlled by Mr.
Maynard and 2,456,596 shares held of record by Mr. Maynard, as trustee of a
trust for his benefit.
ELECTION OF DIRECTORS
In accordance with the Company's By-laws three directors are to be elected
at the annual meeting. Each director elected will hold office until the next
annual meeting and until his successor is elected and qualifies. Shares
represented by valid proxies will be voted for the election of the three
nominees listed below.
The nominees have consented to serve on the Board, if elected, but should
any of the three be unable to serve in this capacity at the time of the meeting,
the proxies will be voted by the proxy holders in their discretion for any
substitute nominee who may be designated by Management. It is anticipated that
the nominees will be available to serve as directors.
Names of Nominees Position with Company, Business
for Election Age Experience and other Directorships
- ----------------- --- ----------------------------------
Ralph E. Graham 77 Director of the Company since 1993. Partner of Day
Oil Company, an oil and gas exploration and
drilling partnership.
James G. Maynard 71 Chief Executive Officer and Chairman of the Board
of the Company, since its incorporation in 1971.
Robert B. McDermott 69 Director of the Company since 1971. Business
Consultant and Director of The Cherry Corporation,
an electronics manufacturer.
MEETINGS OF THE BOARD OF DIRECTORS AND THE COMMITTEES OF THE BOARD OF DIRECTORS
During the past fiscal year, the Board of Directors met four times, the
Compensation Committee of the Board, comprised of Messrs. Maynard, Graham and
McDermott, met twice and the Audit Committee, comprised of Messrs. McDermott and
Graham, met twice. The Audit Committee recommended, and the Board of Directors
selected Price Waterhouse to audit the Company's financial statements for the
year ended December 31, 1996. The Compensation Committee sets the compensation
of the officers of the Company and the Audit Committee meets with the public
accountants and accounting personnel of the Company for review of their
respective information, opinions and functions. Mr. Maynard's compensation was
determined by Messrs. McDermott and Graham as more fully described in the
Compensation Committee Report on Executive Compensation. The Board of Directors
does not have a nominating committee. No incumbent director attended fewer than
75% of the total number of meetings of the Board of Directors and of the
committees on which he served.
EXECUTIVE COMPENSATION
The table below sets forth certain information concerning the annual and
long-term compensation for services in all capacities to the Company for the
fiscal years ended December 31, 1996, 1995 and 1994, of those persons who were,
at December 31, 1996 (I) the chief executive officer, and (ii) the other three
executive officers of the Company with compensation in excess of $100,000.
SUMMARY COMPENSATION TABLE
Annual Compensation(1)
------------------------------
Name and Principal Fiscal All Other
Position Year Salary(2) Bonus(3) Compensation(4)
- ------------------ ------ --------- -------- ---------------
James G. Maynard 1996 $105,000 $ -0- $ 7,900(6)
Chairman of the Board, 1995 105,000 -0- 3,150(6)
Chief Executive 1994 97,200 -0- 3,664
Officer and
Treasurer
Glenn R. Moore 1996 159,615 8,150 12,000(6)
President 1995 152,692 4,400 12,000
1994 149,000 7,500 12,520
L. B. Carruth 1996 135,144 6,900 11,115(7)
Vice President of 1995 128,846 3,800 10,808
Operations 1994 125,000 6,250 10,000
Kenneth W. Hatcher 1996 121,062 6,180 9,957(8)
Vice President of 1995 115,446 3,400 9,683
Finance 1994 112,000 5,600 8,960
(1) The Company does not maintain a "long term incentive plan" as that plan is
defined in the applicable rules.
(2) Includes amounts deferred under the Company's Thrift Investment Plan.
(3) Includes bonus awards earned for performance in the fiscal year even though
such amounts could be payable in subsequent years.
(4) Totals shown consist of the Company's contributions to (I) the Retirement
Plan in the amount of 3% of annual salary and (ii) the Thrift Investment
Plan for the remainder.
(5) During 1996, $3,150 was accrued in the Retirement Plan and $4,750 in the
Thrift Investment Plan on behalf of Mr. Maynard.
(6) During 1996, $4,500 was accrued in the Retirement Plan and $7,500 in the
Thrift Investment Plan on behalf of Mr. Moore.
(7) During 1996, $4,168 was accrued in the Retirement Plan and $6,947 in the
Thrift Investment Plan on behalf of Mr. Carruth.
(8) During 1996, $3,734 was accrued in the Retirement Plan and $6,223 in the
Thrift Investment Plan on behalf of Mr. Hatcher.
The table below summarizes certain information with respect to the value of the
stock options exercised and the stock participation units held by executive
officers at December 31, 1996.
Aggregated Option/Stock Participation (SPAR) Exercises in 1996
and December 31, 1996 Stock Participation (SPAR) Values
Number of
Securities Value of
Underlying Unexercised
Unexercised In-the-Money
SPARs at SPARs(2) at
12/31/96 (#) 12/31/96 ($)
Exercisable/ Exercisable/
Unexercisable Unexercisable
--------------- --------------
Maynard 0/0 0/0
Moore 22,000/7,000(3) 305,625/91,875
Carruth 11,250/3,750(4) 156,094/49,219
Hatcher 10,500/3,000(5) 146,250/39,375
(1) The Company's Stock Option Plan expired March 31, 1992 and, therefore, no
additional stock options can be granted. All options were exercised in
September, 1995.
(2) Based upon a price of $18.75 per share, the last bid price on NASDAQ of the
Company's Common Stock on December 31, 1996.
(3) Represents 29,000 SPARs of which 22,000 have vested.
(4) Represents 15,000 SPARs of which 11,250 have vested.
(5) Represents 13,500 SPARs of which 10,500 have vested.
There were no awards of stock participation units to any employee in 1996.
COMPENSATION OF DIRECTORS
During 1996, each director, who was not an employee of the Company,
received an annual retainer of $10,000. In addition, each committee member, who
was not an employee of the Company, (two each for both the Compensation and
Audit Committees) received an annual amount of $3,000.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Committee's goal is to compensate all executives fairly, for both their
long-term and recent contributions to the Company. The Committee believes that
services of outstanding value can be rendered in periods of financial or
operating stringency, as well as in boom times.
Compensation for each executive includes a salary and from time to time
longer-term incentive compensation, such as stock options and stock
participation units. The Committee considers the total compensation (earned or
potentially available) of each executive officer in establishing each element of
compensation. At the end of 1996, the Committee authorized cash bonuses
totaling $92,380 to a total of 36 employees, (excluding Mr. Maynard at his
request), to recognize meritorious performance during the year.
Salaries for executives are reviewed by the Committee on an annual basis
and may be increased to reflect the individual's contribution to the Company or
changes in the competitive level of pay. The Committee has access to a national
survey on oil and gas compensation, which includes executives in both larger and
smaller companies. Companies which participated in the compensation survey
include privately held corporations, as well as companies on NASDAQ, the
American Stock Exchange, and the New York Stock Exchange. This national survey
covers more companies than are included in the Performance Graph on Page 9 and
it is believed to be the best available information for the intended purpose.
Mr. Maynard, Mr. Moore, Mr. Carruth and Mr. Hatcher are paid compensation which
generally ranks them in or below the mid-range of executives in similar
positions for corporations of similar size.
The Compensation Committee evaluates the salary of Mr. Maynard, the Chief
Executive Officer, based largely on the Committee's assessment of his past and
current performance and its expectation as to his future contributions in
leading the Company and its business. The Compensation Committee believes a key
indicator for an oil and gas exploration and production company is the
replacement of hydrocarbon reserves through drilling or acquisition, the cost of
such reserves and the extent of the risk to which the shareholder's investment
has been subjected. The Company's net equivalent barrels of reserves have
increased, largely through acquisition, by 30% during 1994 and an additional 39%
in 1995. During 1996, the Company did not make an acquisition, but rather
directed its efforts toward realization of the maximum dollars from its existing
reserve base. Consequently, the Company sold several non-strategic properties
at a gain of six million dollars. The Committee believes that Mr. Maynard's
contributions to the Company warrant a salary substantially in excess of what he
is paid; it has limited Mr. Maynard's compensation at Mr. Maynard's express
request.
The Committee also considered the Company's performance in determining
other salaries and bonus awards for 1996. It considered these factors both on
an absolute basis and relative to the oil and gas industry, in general. In
determining salaries for employees, other than Mr. Maynard, the Committee
reviewed the Chief Executive Officer's recommendations based upon individual
performance, as well as the factors mentioned in the above paragraph.
Since the price of the Company's stock is affected to a significant degree
by oil and gas prices, over which executives have no control, and various other
factors over which they have limited control, the Committee has focused on
salaries as the principal means of providing incentives and rewarding executive
performance. The Company did not award stock options or stock participation
units ("shadow stock") in 1996.
During 1996, the Compensation Committee consisted of Ralph E. Graham, James
G. Maynard and Robert B. McDermott, all directors of the Company. Mr. Maynard
does not take part in the determination of his compensation.
The Compensation Committee Report on Executive Compensation shall not be
deemed incorporated by reference by any general statement incorporating by
reference this proxy statement into any filing under the Securities Act of 1933
or under the Securities Exchange Act of 1934, except to the extent that the
Company specifically incorporates the information by reference, and shall not
otherwise be deemed filed under such Acts.
For the Compensation Committee
James G. Maynard
Robert B. McDermott
Ralph E. Graham
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
James G. Maynard is Chief Executive Officer and Chairman of the Board of
the Company.
PERFORMANCE GRAPH
Set forth below is a line graph comparing the yearly cumulative total
stockholder return on the Company's Common Stock against the cumulative total
return of the NASDAQ Stock Market for U.S. Companies and the NASDAQ Industry
Index for oil and gas production companies for the five fiscal years ending
December 30, 1996. This graph assumes that $100 was invested on December 31,
1991 and that all dividends were reinvested. The performance shown on the graph
below is not necessarily indicative of future performance. The Company will
make available to requesting stockholders the identities of the companies within
the CRSP Index for NASDAQ stock (SIC-1300-1399 US Companies). All of the
companies listed in this index are involved in oil and gas extraction.
The Performance Graph below shall not be deemed incorporated by reference
by any general statement incorporating by reference this proxy statement into
any filing under the Securities Act of 1933 or under the Securities Exchange Act
of 1934, except to the extent that the Company specifically incorporates this
information by reference, and shall not otherwise be deemed filed under such
Acts.
Comparison of Five-Year-Cumulative Total Returns
CRSP Index
CRSP Index For
for NASDAQ
Nasdaq Stock Stocks (SIC
Fiscal Year Maynard Oil Market 1300-1399
Covered Company (US Companies) US Cos.)*
---------- ---------- -------------- ---------
12/31/91 100.0 100.0 100.0
12/31/92 92.5 116.4 103.5
12/31/93 105.0 133.6 133.0
12/31/94 100.0 130.6 124.3
12/31/95 135.0 184.7 153.7
12/31/96 375.0 153.7 252.8
Note:
* The peer index includes results from all US companies trading on NASDAQ in
the 130 SIC group, oil and gas extraction and production companies, which
includes 232 companies over the period presented and 123 active at
December 31, 1996.
INDEPENDENT ACCOUNTANTS
Price Waterhouse audited the Company's financial statements for the year
ending December 31, 1996 and has been selected as the independent accounting
firm who will audit the Company's financial statements for the year ending
December 31, 1997. Representatives of Price Waterhouse are expected to be
present at the meeting and will be given the opportunity to make a statement if
they desire to do so and are expected to be available to respond to appropriate
questions.
STOCKHOLDER'S PROPOSALS
Any proposal by a stockholder of the Company intended to be presented at
the next annual meeting of stockholders and included in the Company's proxy
statement and form of proxy relating to that meeting, must be received by the
Company at its principal executive office not later than December 17, 1997, and
must also comply with other requirements of the proxy solicitation rules of the
Securities and Exchange Commission. In addition, the notice provisions
contained in the Company's By-laws must be satisfied in order for a stockholder
to bring business properly before any meeting of stockholders.
OTHER MATTERS
The Management of the Company does not know of any other matters that are
to be presented for action at the annual meeting. Should any other matter come
before the meeting, however, the persons named in the enclosed proxy will have
discretionary authority to vote all proxies with respect to such matter in
accordance with their judgment.
By Order of the Board of Directors
Linda K. Burgess
Secretary and Controller
Dallas, Texas
April 16, 1997
MAYNARD OIL COMPANY
This Proxy is Solicited on Behalf of the Board of Directors
The undersigned hereby appoints James G. Maynard and Glenn R. Moore as
Proxies, each with the power to appoint a substitute, and hereby authorizes them
to vote, as designated on the reverse side, all shares of common stock of
Maynard Oil Company held of record by the undersigned on April 7, 1997, at the
Annual Meeting of Stockholders to be held on May 21, 1997, or any adjournment or
adjournments thereof.
In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting. THIS PROXY WHEN PROPERLY
EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY THE UNDERSIGNED
STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR THE DIRECTOR
NOMINEES.
(continued on reverse side)
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY
THE UNDERSIGNED STOCKHOLDER, IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED
FOR PROPOSAL 1.
1. To vote for the election of James G. Maynard, Ralph E. Graham, and
Robert B. McDermott as directors, to hold office until the 1998 Annual
Meeting of Stockholders. If it is desired that votes be withheld from the
election of any of the individual nominees, his name should be written in
the following space.
---------------------------------------------
WITHHOLD
AUTHORITY
FOR TO VOTE
2. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting.
THIS PROXY IS SOLICITED ON BEHALF OF THE
COMPANY'S BOARD OF DIRECTORS WHICH ENCOURAGES
EACH SHAREHOLDER OF RECORD TO VOTE.
Please sign exactly as name appears hereon.
When share are held by joint tenants, both
should sign. When signing as attorney, as
executor, administrator, trustee or guardian,
please give full title as such. If a
corporation, please sign in full corporate
name by President or other authorized
officer. If a partnership, please sign in
partnership name by authorized person.
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY
CARD PROMPTLY USING THE ENCLOSED ENVELOPE.
- ------------------------- ------------------------- ------------------
Signature(s) Signature(s) Date
