SCHEDULE 14C INFORMATION
Information Statement Pursuant to Section 14(c)
of the Securities Exchange Act of 1934 (Amendment No. )
Check the appropriate box:
[ ] Preliminary Information Statement [ ] Confidential, for use of the
Commission Only (as permitted
[X] Definitive Information Statement by Rule 14a-6(e)(2))
MEXCO ENERGY CORPORATION
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(Name of Registrant as Specified in Charter)
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<PAGE>
MEXCO ENERGY CORPORATION
Suite 1101
214 W. Texas 79701
Midland, Texas 79701
(915) 682-1119
(915 682-1123 (FAX)
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To be held September 15, 1999
TO THE STOCKHOLDERS:
Notice is hereby given that the Annual Meeting of the Stockholders of MEXCO
ENERGY CORPORATION (the "Company") will be held at the Company's principal
executive office, Suite 1101, 214 W. Texas Avenue, Midland, Texas 79701, at 2:00
P.M. Central Standard Time on September 15, 1999, for the following purposes:
1. To elect seven directors of the Company.
2. To ratify the selection of auditors for the Company.
3. To transact such other business as may properly come before the meeting.
The stock transfer records for the Company will not be closed. The close of
business on August 13, 1999 has been fixed by the Board of Directors as the
record date for determining the shareholders of the Company entitled to notice
of and to vote at the meeting.
DATED this 17th day of August 1999.
BY ORDER FO THE BOARD OF DIRECTORS
DONNA GAIL YANKO, SECRETARY
<PAGE>
MEXCO ENERGY CORPORATION
INFORMATION STATEMENT
FOR THE ANNUAL MEETING OF STOCKHOLDERS OF
MEXCO ENERGY CORPORATION
To be held September 15, 1999
This Information Statement is furnished by the management of MEXCO ENERGY
CORPORATION (the "Company"), in connection with the Annual Meeting of
Stockholders of the Company to be held at the Company's principal executive
office, 214 W. Texas Avenue, Suite 1101, Midland, Texas 79701, at 2:00 p.m.,
Central Standard Time.
The Annual Report to stockholders respecting the Company's fiscal year
ending March 31, 1999, and the Information Statement were mailed to stockholders
on or about August 17, 1999.
WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE
REQUESTED NOT TO SEND US A PROXY.
VOTING SECURITIES
The close of business as of August 13, 1999 (the "Record Date") has been
fixed as the date of record for the determination of stockholders entitled to
notice of and vote at the Annual Meeting. As of the Record Date, there were
1,623,289 shares of common stock of the Company (the "Common Stock")
outstanding. Holders of shares of Common Stock are entitled to one vote at the
Annual Meeting for each share of Common Stock held of record on the Record Date.
PRINCIPAL STOCKHOLDERS AND STOCKHOLDINGS OF MANAGEMENT
The following table sets forth information, as of June 30, 1999 concerning
the Common Stock beneficially owned by each director and nominee of the Company,
by all officers, directors and nominees as a group, and by each stockholder
known by the Company to be the beneficial owner of more than five percent (5%)
of the outstanding Common Stock.
Number of Shares Percent
of Common Stock of
Beneficially Owned (1) Class
---------------------- -------
Howard E. Cox, Jr .............................. 194,000 11.95
Thomas R. Craddick ............................. 5,000 0.31
Linda J. Crass ................................. 2,600 0.16
William G. Duncan, Jr. (2) ..................... -- --
Thomas Graham, Jr .............................. 79,700 4.90
Jack D. Ladd (2) ............................... 1,768 0.11
Gerald R. Martin (2) ........................... 15,040 0.93
Nicholas C. Taylor (3) ......................... 809,828 49.89
Catherine B. Taylor (3) ........................ 269,942 16.63
Donna Gail Yanko ............................... 10,344 0.64
Officers and directors as a group (8 persons) .. 924,280 56.68
(1) Included in the number of shares of Common Stock Beneficially Owned are
shares which such persons have the right to acquire within 60 days of June
30, 1999, pursuant to options to purchase such Common Stock (Ms. Crass,
2,500; Mr. Graham, 2,500; and Ms. Yanko, 2,500.
(2) Denotes a non-employee Director.
(3) Mr. Taylor and Ms. Taylor disclaim any beneficial ownership of common stock
of the Company owned by their two adult children, Nicholas Van Campen
Taylor and Katherine Camilla Taylor, who each own 46,000 shares of the
common stock of the Company. They also disclaim beneficial ownership of
31,000 shares to be held in trust by Texas Gulf Bank, N.A., of Freeport,
Texas for their minor daughter, Christie Hardin Van Vraanken Taylor.
<PAGE>
Compliance with Section 16(a) of the Securities Exchange Act of 1934
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Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors and executive officers, and persons who own more than ten percent
(10%) of a registered class of the Company's equity securities, (collectively
"Reporting Persons"), to file with the Securities and Exchange Commission
("SEC") and the National Association of Securities Dealers, Inc., initial
reports of ownership and reports of changes in ownership of Common Stock and
other equity securities of the Company. Officers, Directors and greater than ten
percent (10%) shareholders are required by SEC regulation to furnish the Company
with copies of all Section 16(a) forms they file.
Ownership of and transactions in Company stock by executive officers and
Directors of the Company are required to be reported to the Securities and
Exchange Commission pursuant to Section 16(a) of the Securities Exchange Act of
1934. In September 1998, Linda J. Crass filed a Form 3 after she was appointed
Controller and Assistant Secretary and granted stock options on August 5, 1998.
On January 12, 1999, Linda J. Crass filed a Form 4 to report 100 shares of stock
acquired on December 7, 1998. Thomas Graham, Jr. filed a Form 5 in July 1999 to
report stock options granted on March 3, 1999. These forms were filed after the
due date.
DIRECTORS
At the Annual Meeting to be held on September 15, 1999, seven persons are
to be elected to serve on the Board of Directors for a term of one year and
until their successors are duly elected and qualified. All of the current
Directors will be available for election to the Board of Directors. The Company
nominees for the seven directorships are set forth in the following table,
together with certain information as to each person as of the date of this
Information Statement.
NOMINEES FOR ELECTION AS DIRECTORS
Director of the
Name Age Position with the Company Company Since
- --------------------- --- ------------------------- ---------------
Thomas R. Craddick 55 Director 1998
William G. Duncan, Jr 56 Director 1994
Thomas Graham, Jr 65 Director and Chairman
of the Board of Directors 1997
Director 1990 to 1994
Jack D. Ladd 49 Director 1998
Gerald R. Martin 53 Director 1998
Nicholas C. Taylor 61 President and Director 1983
Donna Gail Yanko 55 Vice President, Secretary
and Director 1990
THOMAS R. CRADDICK was elected to the Board of Directors of the Company in
March 1998. Since 1968 to the present, Mr. Craddick has served as State
Representative for the State of Texas. Throughout his tenure of the past 16
sessions of the Legislature, Representative Craddick has served on various
committees and conferences, most recently serving on the State Affairs Committee
and the House Ways and Means Committee. For more than the past five years Mr.
Craddick has been sales representative for Mustang Mud, Inc., as well as the
owner of Craddick Properties and owner and President of Craddick, Inc., both of
which invest in oil and gas properties and real estate.
<PAGE>
WILLIAM G. DUNCAN, JR., since 1995, has been the President of Southeastern
Financial Services, Louisville, Kentucky, prior to which he had served as Senior
Vice President and Chief Investment Officer since 1991. For the previous 25
years he held several positions at Liberty National Bank and Trust Company,
Louisville, Kentucky, serving as Senior Vice President and Manager of the bank's
Personal Trust Investment Section, member of Liberty's Trust Executive
Committee, and several positions in Liberty's Commercial Banking Division. Mr.
Duncan has been a Director of the Company since 1994 and is a member of the
compensation committee.
THOMAS GRAHAM, JR. was appointed Chairman of the Board of Directors by the
Directors of the Company, in July 1997, having served as a director from 1990
through 1994. From 1994 through May 1997, Mr. Graham served as a United States
Ambassador. For more than five years prior thereto, Mr. Graham served as the
General Counsel, United States Arms Control and Disarmament Agency, as well as
Acting Director and as Acting Deputy Director of such agency successively, in
1993 and 1994. Since July 1997, he has served as President of the Lawyers
Alliance for World Security.
JACK D. LADD was elected to the Board of Director of the Company in March
1998 and is a member of the compensation committee. For 23 years, Mr. Ladd has
been a shareholder of the law firm of Stubbeman, McRae, Sealy, Laughlin &
Browder, Inc, Midland, Texas. Mr. Ladd is also a partner in various real estate
partnerships, an arbitrator for the National Association of Securities Dealers,
and a mediator certified by the Attorney Mediation Institute. Mr. Ladd has
served as a director and advisory director of other oil and gas corporations.
GERALD R. MARTIN, co-founded River Hill Capital, LLC, a private investment
company, in June 1996. For the prior 23 years, Mr. Martin had worked for J.J.B.
Hilliard, W. L. Lyons, Inc., a member of the New York Stock Exchange, 17 years
were spent as Senior Vice President of Investment Banking. Mr. Martin has
experience as a financial consultant or advisor to several local government
agencies and non-profit organizations. In December 1996, he completed 15 years
of volunteer service as Vice Chairman of the Board of Commissioners of the
Housing Authority of Louisville. Mr. Martin is a director of Orr Safety
Corporation in Louisville, Kentucky and Begley Company in Richmond, Kentucky. He
was elected to the Board of Directors of the Company in March 1998 and is a
member of the compensation committee.
NICHOLAS C. TAYLOR was elected President, Treasurer and Director of the
Company in April 1983 and continues to serve as President and Director on a
part-time basis, as required. Mr. Taylor served as Treasurer until March 1999.
From July 1993 to the present, Mr. Taylor has been involved in the independent
practice of law and other business activities. For more than the prior 19 years,
Mr. Taylor was a director and shareholder of the law firm of Stubbeman, McRae,
Sealy, Laughlin & Browder, Inc., Midland, Texas, and a partner of the
predecessor firm. In 1995 he was appointed by the Governor of Texas and serves
as Chairman of the three member State Securities Board.
DONNA GAIL YANKO has worked as part-time Administrative Assistant to the
Chief Executive Officer and as Assistant Secretary of the Company until June
1992 when she was appointed Corporate Secretary. Mrs. Yanko was appointed to the
position of Vice President and elected to the Board of Directors in 1990.
<PAGE>
During the year ended March 31, 1999, the Board of Directors met at 12
regularly scheduled Board meetings and 3 compensation committee meetings. Board
members attended on average over 94% of the Board and appropriate compensation
committee meetings, with the exception of Mr. Ladd who attended less than 75% of
these meetings due to a prolonged illness from which he has since recovered. The
Compensation Committee currently consists of Messrs. Duncan, Ladd and Martin,
all of whom are non-employee directors. The Board of Directors does not have a
standing audit or nominating committee or any committees performing similar
functions. Board members perform these functions.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company owns a working interest in and serves as the operator of
properties in which the President of the Company also owns a working interest.
The Company operates these wells on a contract basis charging the same
administrative overhead fees as the previous operator. The billings for lease
operating expenses related to these properties totaled approximately $21,981 for
the year ended March 31, 1999.
EXECUTIVE COMPENSATION
The following table sets forth information concerning annual and long-term
compensation paid or accrued to executive officers for services in all
capacities to the Company for the fiscal year ended March 31, 1999.
SUMMARY COMPENSATION TABLE
Securities All
Name and Underlying Other
Principal Position Year Salary Bonus Options Compensation
- ----------------------- ---- ------- ------- ---------- ------------
Nicholas C. Taylor 1999 $ -- $ -- -- $ 1,200
President & CEO 1998 $ -- $ -- -- $ 500
1997 $ -- $ -- -- $ 200
Donna Gail Yanko 1999 $ 8,100 $ 3,969 20,000 $ 1,200
Vice President & 1998 $ 7,875 $ -- -- $ 500
Secretary 1997 $ 7,800 $ -- -- $ 200
Linda J. Crass 1999 $51,713 $ 787 20,000 $ --
Treasurer, Controller 1998 $ -- $ -- -- $ --
& Assistant Secretary 1997 $ -- $ -- -- $ --
Thomas Graham, Jr 1999 $ 600 $ -- 20,000 $ 1,800
Chairman 1998 $ -- $ -- -- $ 500
1997 $ -- $ -- -- $ --
Thomas R. Craddick 1999 $ 300 $ -- 10,000 $ 900
Director 1998 $ -- $ -- -- $ 500
1997 $ -- $ -- -- $ --
* All other compensation is comprised of director fees. There are no
employment agreements or retirement benefit plans. Directors were paid $100
per meeting. Currently non-employee directors are paid $100 per meeting.
The sole compensation received by the President and CEO of the Company for
such period consisted of director's fees. Compensation Committee Report on
Executive Compensation
<PAGE>
The Compensation Committee of the Board of Directors is solely responsible
for setting executive compensation including base pay and Directors' fees. Such
payment is based on performance, including hours worked and effectiveness.
Employee Incentive Stock Option Plan
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The Company adopted an employee incentive stock plan effective September
15, 1997. Under the plan, 350,000 shares are available for distribution. Awards,
granted at the discretion of the compensation committee of the Board, include
stock options and restricted stock. Stock options may be incentive stock options
or non-qualified stock options. The exercise price of each option will not be
less than the market price of the Company's stock on the date of grant. The
maximum term of the options is ten years. Restricted stock may be granted with a
condition to attain a specified goal. The purchase price will be at least $5.00
per share of restricted stock. The awards of restricted stock must be accepted
within sixty days and will vest as determined by agreement. Holders of
restricted stock have all rights of a shareholder of the Company. At March 31,
1999, no restricted stock had been granted under the plan.
OPTION GRANTS IN LAST FISCAL YEAR TABLE
<TABLE>
<CAPTION>
Potential Realizable Value
Number of Individual Grants After 10 years based on
Securities Percentage of Assumed Compounded Annual
Underlying Total Options Exercise Rates of Stock Price Appreciation
Options Granted to Price Expiration ---------------------------------
Name Granted(1) Employees in 1999 (per Share) Date 5% per Year 10% per Year
- ------------------ ---------- ----------------- ----------- ---------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C>
Donna Gail Yanko 10,000 12.5% $ 7.75 04/02/08 $ 48,739 $123,515
10,000 12.5% $ 7.50 03/03/09 $ 47,167 $119,531
Linda J. Crass 10,000 12.5% $ 7.75 08/05/08 $ 48,739 $123,515
10,000 12.5% $ 7.50 03/03/09 $ 47,167 $119,531
Thomas Graham, Jr 10,000 12.5% $ 7.75 04/02/08 $ 48,739 $123,515
10,000 12.5% $ 7.50 03/03/09 $ 47,167 $119,531
Thomas R. Craddick 10,000 12.5% $ 7.50 03/03/09 $ 47,167 $119,531
</TABLE>
(1) Options have a 10-year term and are vested 25% per year on the anniversary
date of the grant. The exercise price is a fair market value on the date of
grant.
AGGREGATE OPTIONS EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR END OPTION VALUES TABLE
<TABLE>
<CAPTION>
Number of Securities Value of Unexercised
Underlying Unexercised In-the-Money
Shares Options at March 31, 1999 Options at March 31, 1999
Acquired on Value -------------------------- --------------------------
Name Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
- ------------------ ----------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Donna Gail Yanko 0 $ 0 0 20,000 $ 0 $ 1,875
Linda J. Crass 0 $ 0 0 20,000 $ 0 $ 1,875
Thomas Graham, Jr 0 $ 0 0 20,000 $ 0 $ 1,875
Thomas R. Craddick 0 $ 0 0 10,000 $ 0 $ 1,875
</TABLE>
<PAGE>
STOCK PERFORMANCE GRAPH
The following graph shows how an initial investment of $100 in the
Company's Common Stock would have compared to an equal investment in the S&P 500
Index or in an index of Peer Group Competitors over a five year period beginning
March 31, 1994 and ending March 31, 1999. The selected Peer Group consists of
several larger independent oil and gas producers: Noble Affiliates, Inc., Pogo
Producing Company, Anadarko Petroleum Corporation, Apache Corporation, and Oryx
Energy Company. This group of companies is used by the Company for certain
compensation and performance comparisons.
[GRAPH APPEARS HERE]
1994 1995 1996 1997 1998 1999
---- ---- ---- ---- ---- ----
MEXCO $100 $240 $300 $660 $915 $911
S&P 500 $100 $112 $145 $170 $247 $289
PEER GROUP $100 $106 $129 $150 $166 $113
INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors of the Company, by resolution, has approved the
selection of Grant Thornton LLP as the accountants for the Company for the
fiscal year beginning April 1, 1999. A representative of said accountants will
not be present at the Annual Meeting, but will be available by telephone to make
a statement, if they so desire and to respond to appropriate questions. The
Board of Directors does not have an audit or similar committee.
NEXT ANNUAL MEETING
The next Annual Meeting of the Company's stockholders is scheduled to be
held on September 15, 2000. Appropriate proposals of stockholders intended to be
presented at the 1999 Annual Meeting must be received by Ms. Gail Yanko,
Secretary, no later than June 26, 1999, in order to be included in the Company's
Information Statement relating to such meeting.
OTHER MATTERS
Management knows of no other business that will be presented at the Annual
Meeting other than as explained herein.
A majority in interest of the issued and outstanding Common Stock entitled
to vote shall constitute a quorum at the Annual Meeting and shall be necessary
to elect the Board of Directors and transact any business.
The cost of preparing and mailing this Information Statement will be borne
by the Company. The Company will, upon request, reimburse brokers for the cost
incurred by them in mailing copies of this Statement and the Annual Report of
the Company to such of their customers as are beneficial owners of the Common
Stock of the Company registered in the names of such brokers.
STOCKHOLDERS MAY OBTAIN WITHOUT CHARGE A COPY OF THE COMPANY'S ANNUAL
REPORT ON FORM 10-K, INCLUDING THE FINANCIAL STATEMENTS AND SCHEDULES THERETO,
FILED WITH THE SECURITIES AND EXCHANGE COMMISSION FOR THE FISCAL YEAR ENDED
MARCH 31, 1999, BY WRITING THE SECRETARY, MEXCO ENERGY CORPORATION, SUITE 1101,
214 WEST TEXAS AVENUE, MIDLAND, TEXAS 79701.
