April 20, 1998
Notice of Annual Meeting of Shareholders
Notice is hereby given that the Annual Meeting of Shareholders
(the "Meeting") of Mallon Resources Corporation (the "Company")
will be held at the Top of the Rockies (Denver Petroleum Club), 555
17th Street, Denver, Colorado, at 9:00 a.m. local time, on
Thursday, May 28, 1998, for the following purposes:
(I) To elect Directors of the Company; and
(II) To transact such other business as may properly come
before the Meeting.
Only holders of common stock of record at the close of business
on April 14, 1998 are entitled to notice of and to vote at the
Meeting.
By Order of the Board of Directors,
ROY K. ROSS
Corporate Secretary
ALL SHAREHOLDERS ARE CORDIALLY INVITED TO ATTEND THE MEETING.
ALL SHAREHOLDERS, WHETHER OR NOT THEY EXPECT TO ATTEND THE
MEETING IN PERSON, ARE REQUESTED TO COMPLETE, DATE, SIGN AND
RETURN THE ENCLOSED PROXY CARD IN THE ENCLOSED ENVELOPE.
SHOULD YOU ATTEND THE MEETING, YOU MAY, IF YOU CHOOSE TO,
VOTE IN PERSON, EVEN THOUGH YOU MAY HAVE PREVIOUSLY SUBMITTED
A PROXY CARD.
Mallon Resources Corporation
999 18th Street, Suite 1700
Denver, Colorado 80202
Proxy Statement
for
Annual Meeting of Shareholders
To Be Held
Thursday, May 28, 1998
General Information
This statement is furnished in connection with the solicitation
of proxies by the Board of Directors of Mallon Resources
Corporation (the "Company") to be used at its Annual Meeting of
Shareholders (the "Meeting") to be held at the Top of the Rockies
(Denver Petroleum Club), 555 17th Street, Denver, Colorado, on
Thursday, May 28, 1998, at 9:00 a.m., for the purposes set forth in
the accompanying Notice of Annual Meeting of Shareholders. This
statement was sent to shareholders on or about April 21, 1998.
The shares covered by the enclosed Proxy, if such is properly
executed and received by the Board of Directors prior to the
Meeting, will be voted in favor of the proposals to be considered
at the Meeting, unless such Proxy specifies otherwise or the
authority to vote on the election of directors has been withheld.
A Proxy may be revoked at any time before it is exercised by giving
written notice to the Secretary of the Company or by executing a
Proxy bearing a later date. Shareholders may vote their shares in
person if they attend the meeting, even if they have previously
executed and returned a Proxy.
The only matter planned to be brought before the Meeting is the
election of directors to serve for the ensuing year.
Only shareholders of record at the close of business on
April 14, 1998, will be entitled to vote at the Meeting. On that
date, there were issued and outstanding 6,996,200 shares of the
Company's $0.01 par value common stock ("Common Stock"), entitled
to one vote per share. Cumulative voting is not allowed in the
election of directors or for any other purpose. One-third of the
outstanding Common Stock will constitute a quorum for the
transaction of business at the Meeting. The vote of a majority of
a quorum is needed to pass a proposal.
At the Meeting, members of senior management will speak, and
there will be a general discussion period during which shareholders
will have an opportunity to ask questions about the business of the
Company. Management knows of no other matters to be brought before
the Meeting. If other matters properly come before the Meeting, it
is the intention of the persons named in the solicited Proxy to
vote such Proxy in accordance with their judgment. No compensation
will be paid to any person in connection with solicitation of
Proxies. Brokers and others will be reimbursed for out-of-pocket
and reasonable clerical expenses incurred in forwarding
solicitation materials to beneficial owners of the Common Stock.
Special solicitation of Proxies may in certain instances be made
personally or by telephone by officers and employees of the Company
and by regular employees of certain banking and brokerage houses.
All expenses in connection with this solicitation will be borne by
the Company.
Proposal I: Election of Directors
General
The Company's Bylaws provide that the size of the Board of
Directors can be as few as three or as many as fifteen. The number
of directors may be changed from time to time by resolution of the
Board of Directors or the shareholders. The size of the Board of
Directors is presently seven members. Accordingly, management will
nominate seven persons for election to the Board. Directors are
elected annually for one-year terms. The Company has no nominating
or similar committee of its Board of Directors.
It is the recommendation of management that the seven nominees
named below be elected to the Board of Directors for the coming
year, and until their successors have been duly elected and
qualified. Unless authority is withheld, the shares represented by
your Proxy will be voted for their election. No Proxy will be
voted for more than seven nominees. Unless your Proxy withholds
authority to do so, if any nominee elects not to serve or is unable
to serve for any reason, your Proxy will be voted for an
alternative nominee to be designated by management to replace such
nominee. The Board of Directors has no reason to expect that any
nominee will be unable to serve. There is no arrangement between
any of the nominees or officers and any other person or persons
pursuant to which he was or is to be selected as a director,
nominee or officer, nor is there any family relationship between or
among any nominees or officers. To the best knowledge of the
Company, none of the nominees have been involved in any material
legal proceedings during the past five years.
Nominees
Nominees for the Board of Directors are:
Period of Service
Name Age Title(s) as Director
George O. Mallon, Jr. 53 Director, President, Since 1988
Chairman of the Board, and
Chief Executive Officer
Kevin M. Fitzgerald 43 Director, Since 1988
Executive Vice President and
Chief Operating Officer
Roy K. Ross 47 Director, Since 1992
Executive Vice President,
General Counsel, and Secretary
Frank Douglass 63 Director Since 1988
Roger R. Mitchell 64 Director Since 1990
Francis J. Reinhardt Jr. 67 Director Since 1994
Peter H. Blum 40 Director Since 1998
Principal Occupations
A brief description of the business experience of each nominee
for election or re-election as a director is set forth below:
George O. Mallon, Jr., has served as President, Chairman, and
Chief Executive Officer of the Company since its formation in
December 1988. Mr. Mallon is also Chairman of Mallon Oil Company
("Mallon Oil"), the Company's wholly-owned subsidiary, and a
director of Laguna Gold Company ("Laguna"), a gold mining company
in which the Company owns a minority interest. He earned a B.S.
degree in Business from the University of Alabama in 1965, and a
M.B.A. degree from the University of Colorado in 1977.
Kevin M. Fitzgerald has served as Executive Vice President and
Chief Operating Officer of the Company since its formation in
December 1988. Mr. Fitzgerald, who is also President of Mallon
Oil, earned a B.S. degree in Petroleum Engineering from the
University of Oklahoma in 1978.
Roy K. Ross joined the Company as Executive Vice President and
General Counsel in October 1992. From June 1976 through September
1992, Mr. Ross was an attorney in private practice with the Denver-
based law firm of Holme Roberts & Owen. Mr. Ross, who is also
Executive Vice President and General Counsel to Mallon Oil and a
director and Vice President of Laguna, earned his B.A. degree in
Economics from Michigan State University in 1973, and his J.D.
degree from Brigham Young University in 1976.
Frank Douglass is an attorney with the Texas law firm of Scott,
Douglass & McConnico, LLP, where he has been a partner since 1976.
Mr. Douglass earned a B.B.A. degree from Southwestern University in
1953 and a L.L.B. degree from the University of Texas School of Law
in 1958.
Roger R. Mitchell lives in North Carolina, where he is retired
and attends to his personal investments. He earned a B.S. degree
in Business from Indiana University in 1954 and an M.B.A. degree
from Indiana University in 1956.
Francis J. Reinhardt, Jr. is with the New York investment
banking firm of Carl H. Pforzheimer & Co., where he has been a
partner since 1966. He is a member and past president of the
National Association of Petroleum Investment Analysts. Since
December 1992, Mr. Reinhardt has also been a director of XCL, Ltd.,
a public company engaged in the oil and gas business. Mr.
Reinhardt holds a B.S. degree from Seton Hall University and an
M.B.A. from New York University.
Peter H. Blum became a director of the Company in January 1998.
He is a Senior Managing Director with the New York investment
banking firm of Gaines, Berland Inc. From 1995 to 1997, Mr. Blum
held the position of Managing Director with the investment banking
firm Rodman & Renshaw, Inc. From 1992 to 1995, Mr. Blum held
various positions with the investment banking firm Mabon
Securities, Inc. Mr. Blum earned a B.B.A. degree in accounting
from the University of Wisconsin in 1979.
Meetings and Committees of the Board; Board Compensation
The business and affairs of the Company are under the direction
of the Board of Directors. For the period April 1997 through March
1998, the Board of Directors held six formal meetings, and acted by
written consent on numerous occasions. Other than Mr. Blum (who
joined the Board in January), each director who is standing for re-
election attended all of the meetings, either in person or by means
of a telephone conference connection, and all directors
participated in all of the written consents. Directors who are not
also members of management are paid $2,000 for each meeting they
attend. Board members are also reimbursed for reasonable out-of-
pocket expenses incurred in connection with attending meetings of
the Board. In July 1997, to compensate them for their past service
to the Company, Messrs. Mitchell, Douglass and Reinhardt were
granted options, that vested immediately, to purchase 12,000,
10,000 and 8,000 shares of Common Stock, respectively, for an
exercise price of $8.375 per share. Also, in January 1998, the
current non-management members of the Board were each granted
options to purchase 9,000 shares of Common Stock at an exercise
price of $7.50. These options vest in equal increments in January
1998, 1999 and 2000.
The Company's Board of Directors has two committees, the Audit
Committee and the Compensation Committee. The Board has assigned
certain advisory authority to each committee, but the decision-
making and management responsibilities of the Company remain with
the full Board. The Audit Committee of the Board, which held one
meeting during the last year, is comprised of Messrs. Douglass,
Mitchell and Reinhardt. The Audit Committee's purpose is to
oversee the Company's accounting and financial reporting policies
and practices and to assist the Board of Directors in fulfilling
its fiduciary and corporate accountability responsibilities. The
Company's independent auditors have unrestricted direct access to
the Audit Committee members. The Compensation Committee of the
Board, which held two formal meetings and acted by unanimous
written consent on several occasions during the last year, is
currently comprised of Messrs. Douglass, Reinhardt and Blum. The
Compensation Committee has submitted the report that appears below.
Compensation Committee Report
The Company's Board of Directors established the Compensation
Committee (the "Committee") to propose, subject to Board
ratification, equity and cash compensation of executive officers
and equity compensation for all employees. The Committee's
philosophy is that employee compensation (including salary, bonus
and equity-based compensation) should be near the mid-point of
industry standards and that, so long as the Company is able,
employees who consistently perform exceptionally should be
compensated at a rate higher than the mid-point of industry
standards. The Committee believes that equity compensation -- in
the form of stock options -- is an excellent incentive for all
employees, including executive officers, and serves to align the
interests of the employees, executive officers and shareholders.
In 1997, the Company engaged the services of Towers Perrin, an
expert in the area of industry compensation matters, to conduct a
survey of compensation practices in the oil and gas industry and to
advise the Company with respect thereto.
Cash Compensation. The Committee's cash compensation
objectives are to: (a) establish an equitable pay scale for
employees, (b) facilitate recruiting, and (c) reward employees for
their loyalty and efforts. The executive officers of the Company
are considered in this planning in the same manner as all other
employees. Each year, all employees, including the executive
officers, are evaluated by their managers (or in the case of the
Chief Executive Officer, by the Committee) and may receive salary
adjustments based upon their performance.
Equity Compensation. Historically, the Company has not used
equity compensation as a component of employee compensation
packages as widely as is common in the industry. After the
Company's 1997 Equity Participation Plan (the "Plan") was ratified
by the shareholders at last year's annual meeting, the Committee
began making equity compensation awards as part of its compensation
decisions. The Committee must approve all awards made under the
Plan. All employees will be eligible for awards under the Plan.
The Plan was designed to provide: (a) a method to both attract and
retain high caliber talent over the long term, (b) an opportunity
for all employees to share in the long term success of the Company,
(c) an ownership interest in the Company's success, (d) recognition
of individual contributions; and (e) motivation for continued
efforts and accomplishments.
Bonus Compensation. The Company maintains a "Bonus Pool"
comprised of an amount of cash equal to 1.3% of the Company's gross
revenue, as adjusted. Quarterly, the money accumulated in the pool
is paid out as cash bonuses to the employees of the Company. The
Chief Executive Officer proposes the amounts to be paid to each
employee, including himself, based upon his judgment of their
relative contributions to the success of the Company over the
quarter for which the bonus is being paid. His determinations are
subject to review by the Committee.
Chief Executive Officer. In 1995, the Committee reworked Mr.
Mallon's compensation arrangements with the Company to bring his
compensation package closer to industry standards. An employment
contract covering these matters was entered into in April 1997.
That contract is for a three year period, which, until 2000, will
be automatically extended each year for an additional year, unless
the Company earlier elects not to extend the contract. The
contract establishes Mr. Mallon's annual base salary at $175,000.
In connection with the signing of the contract, Mr. Mallon was
awarded 10,000 shares of Common Stock, which vest in increments
over the next three years. Mr. Mallon has also been granted
options under the Plan to purchase shares of Common Stock. Mr.
Mallon's performance as Chief Executive Officer and President is
subject to review by the Committee annually, which review may
result in adjustments to his compensation package.
Respectfully submitted,
The Compensation Committee
Frank Douglass
Francis J. Reinhardt, Jr.
Peter H. Blum
* The report of the Compensation Committee 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 Act of 1934, except to the
extent that the Company specifically incorporates this report by
reference.
Executive Compensation
The following table summarizes certain information regarding
compensation awarded to, earned by or paid by the Company for
services rendered for the year ended December 31, 1997 to the
Company's chief executive officer and the four other most highly
compensated individuals whose total compensation, exceeded $100,000
for such year.
SUMMARY COMPENSATION TABLE
Year ended December 31, 1997
<TABLE>
<CAPTION>
Annual Compensation Long Term Compensation
Awards
Securities
Name and Other Annual Restricted Underlying All Other
Principal Bonus Compensation Stock Awards Options/SARs Compensation
Position Year Salary($) ($) ($) ($) (#) ($)
<S> <C> <C> <C> <C> <C> <C> <C>
G.O. Mallon, Jr.
CEO 1997 175,000 29,700 73,750 (1) 142,000 2,375
1996 141,000 12,000 34,000
1995 106,635 10,440
K.M. Fitzgerald
E.V.P. 1997 145,000 24,000 73,750 (2) 127,500 1,500
1996 111,000 10,400 34,000
R.K. Ross
E.V.P. 1997 140,000 22,400 36,875 (3) 78,000 2,375
1996 106,000 9,400 34,000
W.A. Bond
V.P. Exploration
of Mallon Oil 1997 90,000 13,725 15,000
D.M. Erickson
V.P. Operations
of Mallon Oil 1997 91,667 9,500 20,000 1,676
</TABLE>
1. In April 1997, Mr. Mallon was granted 10,000 Restricted Stock Bonus Shares.
The shares vest 1,000 shares in April 1998, 4,000 shares in April 1999,
and 5,000 shares in April 2000.
2. In April 1997, Mr. Fitzgerald was granted 10,000 Restricted Stock Bonus
shares. The shares vest 1,000 shares in April 1998, 4,000 shares in April
1999, and 5,000 shares in April 2000.
3. In April 1997, Mr. Ross was granted 5,000 Restricted Stock Bonus Shares.
The shares vest 1,000 shares in April 1998, 1,500 shares in April 1999,
and 2,500 shares in April 2000.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
Year ended December 31, 1997
<TABLE>
<CAPTION>
Individual Grants
________________________________________________________________________
Number of Securities Percent of Total Exercise or Grant Date
Underlying Options/ Options/SARs Granted Base Price Expiration Present Value(1)
Name SARs Granted (#) In Fiscal Year ($/Sh) Date ($)
<S> <C> <C> <C> <C> <C>
G.O. Mallon, Jr. 142,000 30.3 8.375 10JUN07 605,772
K.M. Fitzgerald 127,500 27.2 8.375 10JUN07 543,915
R.K. Ross 78,000 16.6 8.375 10JUN07 332,748
W.A. Bond 15,000 3.2 8.375 10JUN07 63,990
D.M. Erickson 20,000 4.3 0.01 10JUN07 167,342
</TABLE>
1. The Grant Date Present Value of the options was determined using the
Black-Scholes option-pricing model, using the following assumptions:
risk-free interest rate - 6.0%; expected life in years - 4; expected
volatility - 59%; expected dividends - 0.0%.
AGGREGATE OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION/SAR VALUES
<TABLE>
<CAPTION>
Number Of Securities Under- Value Of Unexercised In-
Shares Acquired lying Unexercised Options/ The-Money Options/SARs
On Exercise Value Realized SARs At Fiscal Year-End(#) At Fiscal Year-End ($)
Name (#) ($) Exercisable Unexercisable Exercisable Unexercisable
<S> <C> <C> <C> <C> <C> <C>
G.O. Mallon Jr. 149,279 0 59,761 0
K.M. Fitzgerald 56,029 88,500 139,808 0
R.K. Ross 1,000 8,880 21,137 58,500 13,440 0
W.A. Bond 0 15,000 0 0
D.M. Erickson 0 20,000 0 164,800
</TABLE>
Equity Participation Plans. Under the Mallon Resources
Corporation 1988 Equity Participation Plan and the Mallon Resources
Corporation 1997 Equity Participation Plan, shares of Common Stock
have been reserved for issuance for various compensation purposes.
The Plans are administered by a committee, currently comprised of
Messrs. Reinhardt, Douglass and Blum, none of whom is eligible to
participate in the Plans. The terms of any awards made under the
Plans are within the broad discretion of the committee. At
December 31, 1997, the following options to purchase shares of the
Company's Common Stock were issued and outstanding under the Plans:
Number of Weighted Average
Shares Exercise Price
545,276 $7.36
Employee Profit Sharing and Thrift Plan. The Company
established the Mallon Resources Corporation 401(k) Profit Sharing
Plan (the "401(k) Plan") effective January 1, 1989. The Company
will match an employee's contribution to the 401(k) Plan in an
amount up to 25% of his or her eligible monthly contributions. The
Company may also contribute additional amounts at the discretion of
the Compensation Committee of the Board of Directors, contingent
upon realization of earnings by the Company, which, in the sole
discretion of the Board of Directors, are adequate to justify a
corporate contribution. The 401(k) Plan is open to all full time
employees of the Company.
Certain Relationships and Related Transactions
The Company serves as operator of certain oil and gas
properties in which some of the officers and directors of the
Company have working interests. Such individuals pay their pro-
rata share of all costs relating to the properties, on the same
basis as other unaffiliated interest owners.
The investment banking firm of Gaines, Berland Inc., of which
Mr. Blum is a Senior Managing Director, served as a co-managing
underwriter of the Company's December 1997 public stock sale, in
connection with which it earned underwriting commissions and other
fees of approximately $388,000. At the time of the transaction,
Mr. Blum was not a director of the Company.
Additional Information
Stock Ownership
The following table sets forth information concerning the
beneficial ownership of the Company's Common Stock as of April 15,
1998, by (i) each shareholder known by the Company to own of record
or beneficially more than 5% of the Company's outstanding Common
Stock; (ii) the Company's chief executive officer (Mr. Mallon);
(iii) each of the Company's Directors and nominees, and (iv) all
Directors and Officers as a group.
<TABLE>
<CAPTION>
Number of Percent
Name and Address (1) Shares Owned
<S> <C> <C>
George O. Mallon, Jr. 529,443 (2) 7.3%
Kevin M. Fitzgerald 103,584 (3) 1.5%
Roy K. Ross 47,558 (4) *
Frank Douglass 21,604 (5) *
Roger R. Mitchell 51,340 (6) *
Francis J. Reinhardt, Jr. 45,685 (7) *
Peter H. Blum 83,000 (8) 1.2%
All Officers & Directors as a Group (8 persons) 889,614 (9) 11.9%
</TABLE>
* Less than 1%.
1. The address of Messrs. Mallon, Fitzgerald and Ross is 999 18th
Street, Suite 1700, Denver, Colorado 80202. The address of Mr.
Douglass is 4350 Beltway Drive, Dallas, Texas 75244-8266. The
address of Mr. Mitchell is 5436 Lake Edge Drive, Holly Springs,
North Carolina 27540. The address of Mr. Reinhardt is 650 Madison
Ave., 23rd Floor, New York, New York 10022. The address of Mr.
Blum is 712 Fifth Avenue, 21st Floor, New York, New York 10019.
2. Includes 2,166 shares owned by Mr. Mallon's wife, 227,372 shares
that could be acquired by Mr. Mallon upon the exercise of
immediately exercisable stock options that he holds, and 9,000
restricted stock award shares that have not yet vested. A trust
created for the benefit of Mr. Mallon's children owns shares that
are not included, as Mr. Mallon has no voting or other control over
the shares in the trust.
3. Includes 84,834 shares that could be acquired by Mr. Fitzgerald
upon the exercise of immediately exercisable stock options that he
holds, and 9,000 restricted stock award shares that have not yet
vested. Does not include 115,227 shares covered by stock options
that have not yet vested.
4. Includes 40,819 shares that could be acquired by Mr. Ross upon
the exercise of immediately exercisable stock options that he
holds, and 4,000 restricted stock award shares that have not yet
vested. Does not include 78,733 shares covered by stock options
that have not yet vested.
5. Includes 13,000 shares that could be acquired by Mr. Douglass
upon the exercise of immediately exercisable stock options that he
holds. Does not include 6,000 shares covered by stock options that
have not yet vested.
6. Includes 15,000 shares that could be acquired by Mr. Mitchell
upon the exercise of immediately exercisable stock options that he
holds. Does not include 6,000 shares covered by stock options that
have not yet vested.
7. Includes 11,000 shares that could be acquired by Mr. Reinhardt
upon the exercise of immediately exercisable stock options that he
holds. Does not include 6,000 shares covered by stock options that
have not yet vested.
8. Includes 81,000 shares that could be acquired by Mr. Blum upon
the exercise of immediately exercisable stock options and warrants
that he holds. Does not include 6,000 shares covered by stock
options that have not yet vested.
9. Includes 480,425 shares that could be acquired upon the exercise
of immediately exercisable stock options and warrants and 22,000
restricted stock award shares that have not yet vested. Does not
include 232,560 shares covered by stock options that have not yet
vested.
Annual Report and Financial Statements
You are referred to the Company's Annual Report to Shareholders
for the year ended December 31, 1997, enclosed herewith. The
Annual Report is not incorporated in the Proxy Statement and is not
to be considered part of the soliciting material.
Submission of Shareholder Proposals
Proposals intended for inclusion in next year's Proxy Statement
should be sent to the Secretary of the Company at 999 18th Street,
Suite 1700, Denver, Colorado 80202, and must be received by
March 1, 1999.
Comparative Performance Graph
The following line graph reflects the performance of (i) the
Company's Common Stock, (ii) the NASDAQ Stock Market Total Return
Index (U.S. Companies), and (iii) the Standard Industrial
Classification ("SIC") Index for SIC Code 131 (which includes crude
petroleum and natural gas companies). The graph assumes $100 was
invested on December 31, 1991 in the Company's Common Stock and in
each of the other indices. The graph also assumes the reinvestment
of all dividends. Stock price performance shown on the graph is
not necessarily indicative of future price performance.
<TABLE>
<CAPTION>
Mallon Resources Corporation
Comparison of Cumulative Total Return
1992 1993 1994 1995 1996 1997
<S> <C> <C> <C> <C> <C> <C>
Mallon Resources Corporation 100 72.73 36.36 27.27 40.91 37.50
SIC Code Index 100 119.15 124.87 137.33 182.60 185.09
Nasdaq Market Index 100 119.95 125.94 163.35 202.99 248.30
</TABLE>
Compliance with Securities Transaction Reporting Requirements
Pursuant to Section 16(a) of the Securities Exchange Act 1934,
certain individuals and entities are required to periodically file
reports with the Securities and Exchange Commission in which they
disclose information concerning their transactions involving the
Company's securities. To the Company's knowledge, based solely on
review of copies of such reports submitted to the Company, during
the year ended December 31, 1997, no individual or entity known to
the Company to be subject to the reporting requirements of Section
16(a) failed to satisfy those requirements in a timely fashion.
By Order of the Board of Directors,
ROY K. ROSS
Corporate Secretary
Dated: April 20, 1998
PROXY Mallon Resources Corporation PROXY
999 18th Street, Suite 1700
Denver, Colorado 80202
PROXY CARD
Annual Meeting of Shareholders - May 28, 1998
The undersigned shareholder of Mallon Resources Corporation (the
"Company") acknowledges receipt of notice of the Company's Annual
Meeting of Shareholders to be held in Denver, Colorado, on
Thursday, May 28, 1998, and hereby appoints Alfonso R. Lopez and
Carol Naranjo, or either of them, with the power of substitution,
as attorneys and proxies to represent and vote, as designated
below, all the shares of the Company's Common Stock held of record
by the undersigned on April 14, 1998, at the Annual Meeting, or any
adjournment thereof, as follows:
I. ELECTION OF DIRECTORS:
[ ] FOR ALL NOMINEES LISTED BELOW
(Except as marked to the contrary below)
[ ] WITHHOLD AUTHORITY to vote for all nominees below
George O. Mallon, Jr. Kevin M. Fitzgerald
Roy K. Ross Roger R. Mitchell
Frank Douglass Frances J. Reinhardt, Jr.
Peter H. Blum
(INSTRUCTIONS: To withhold authority to vote for any individual
nominee, draw a line through that nominee's name).
II. 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 and delivered will be voted in
the manner directed herein by the undersigned shareholder. If no
direction is given, this proxy will be voted FOR all proposals.
Dated __________________, 1998
Please sign below exactly as your name appears on the stock
certificate(s). When shares are held as joint tenants, both should
sign. When signing as attorney, 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.
_________________________________
Signature
_________________________________
Signature (if held jointly)
_________________________________
Printed name, as it appears on stock certificate(s)
_________________________________
Printed name of joint tenant, as it appears on stock certificate(s)
PLEASE MARK, SIGN, DATE, AND RETURN THIS PROXY CARD PROMPTLY, USING
THE ENCLOSED ENVELOPE
