<PAGE> 1
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement / / Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
TEXAS MERIDIAN RESOURCE 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/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and
0-11.
(1) Title of each class of securities to which transaction applies:
- --------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
- --------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee
is calculated and state how it was determined):
- --------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- --------------------------------------------------------------------------------
(5) Total fee paid:
- --------------------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
- --------------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
- --------------------------------------------------------------------------------
(3) Filing Party:
- --------------------------------------------------------------------------------
(4) Date Filed:
- --------------------------------------------------------------------------------
<PAGE> 2
TEXAS MERIDIAN RESOURCES CORPORATION
15995 N. BARKERS LANDING, SUITE 300
HOUSTON, TEXAS 77079
NOTICE OF 1996 ANNUAL MEETING OF SHAREHOLDERS
TO THE SHAREHOLDERS OF TEXAS MERIDIAN RESOURCES CORPORATION:
The 1996 Annual Meeting of Shareholders of Texas Meridian Resources
Corporation (the "Company") will be held on June 20, 1996, at 10:00 a.m.
Houston time, at The WestLake Club, 510 WestLake Park Boulevard, Houston,
Texas, for the following purposes:
1. To elect two persons to serve as Class III Directors
on the Company's Board of Directors, which consists of three classes
of Directors serving three-year staggered terms, to hold office until
the 1999 Annual Meeting of Shareholders or until such person's
successor shall be duly elected and qualified;
2. To consider and vote on a proposal to ratify the
appointment of Ernst & Young LLP as the Company's independent auditors
for the fiscal year ending December 31, 1996; and
3. To transact such other business as may properly come
before the meeting.
The Board of Directors has fixed the close of business on April 24,
1996, as the record date for determination of shareholders who are entitled to
notice of and to vote either in person or by proxy at the 1996 Annual Meeting
of Shareholders and any adjournment thereof.
All Shareholders are cordially invited to attend the meeting in
person. Even if you plan to attend the meeting, YOU ARE REQUESTED TO SIGN,
DATE AND RETURN THE ACCOMPANYING PROXY AS SOON AS POSSIBLE.
By Order of the Board of Directors
/s/ JOSEPH A. REEVES, JR.
Joseph A. Reeves, Jr.
Chairman of the Board and
Chief Executive Officer
May 17, 1996
<PAGE> 3
TEXAS MERIDIAN RESOURCES CORPORATION
15995 N. BARKERS LANDING, SUITE 300
HOUSTON, TEXAS 77079
(713) 558-8080
__________________
PROXY STATEMENT
__________________
GENERAL INFORMATION
This Proxy Statement and the accompanying proxy card are furnished in
connection with the solicitation of proxies by order of the Board of Directors
of Texas Meridian Resources Corporation (the "Company") to be voted at the 1996
Annual Meeting of Shareholders (the "Meeting"), to be held at the time and
place and for the purposes set forth in the accompanying notice. Such notice,
this Proxy Statement and the form of Proxy are being mailed to shareholders on
or about May 17, 1996.
The Company will bear the costs of soliciting proxies in the
accompanying form. In addition to the solicitation made hereby, proxies may
also be solicited by telephone, telegram or personal interview by officers and
regular employees of the Company. The Company will reimburse brokers or other
persons holding stock in their names or in the names of their nominees for
their reasonable expenses in forwarding proxy material to beneficial owners of
stock.
All duly executed proxies received prior to the meeting will be voted
in accordance with the choices specified thereon, unless revoked in the manner
provided hereinafter. As to any matter for which no choice has been specified
in a proxy, the shares represented thereby will be voted by the persons named
in the proxy (i) for the election as director of the nominees listed herein;
(ii) for the proposal to ratify the appointment of Ernst & Young LLP as the
Company's independent auditors for the fiscal year ending December 31, 1996;
and (iii) in the discretion of such persons, in connection with any other
business that may properly come before the meeting. Shareholders may revoke
their proxy at any time prior to the exercise thereof by written notice to the
Secretary of the Company at the above address of the Company or by the
execution and delivery of a later dated proxy, or by attendance at the meeting
and voting their shares in person.
As of the close of business on April 24, 1996, the record date for
determining shareholders entitled to vote at the Meeting, the Company had
outstanding and entitled to vote 14,306,059 shares of Common Stock, $.01 par
value ("Common Stock"), and these shares are the only outstanding shares of the
Company entitled to vote. Each share of Common Stock is entitled to one vote
with respect to each matter to be acted upon at the meeting. The holders of a
majority of the outstanding shares of Common Stock as of the record date,
whether represented in person or by proxy, will constitute a quorum for the
transaction of business at the Meeting as to any matter. Under Texas law, any
unvoted position in a brokerage account with respect to any matter will be
considered as not voted and will not be counted toward fulfillment of quorum
requirements as to that matter.
The nominee for director receiving a plurality of votes cast at the
Meeting will be elected as director. Abstentions and broker non-votes will not
be treated as a vote for or against a particular director and will not affect
the outcome of the election of directors.
The affirmative vote of the holders of a majority of the shares of
Common Stock represented in person or by proxy at the Meeting is required for
approval of the proposal to ratify the appointment of Ernst & Young LLP as the
Company's independent auditors for the year ending December 31, 1996.
Abstentions will not be treated as either a vote for or against a proposal, but
will have the same effect as a vote against the proposal.
<PAGE> 4
PROPOSAL ONE -- ELECTION OF CLASS III DIRECTORS
GENERAL
Two directors will be elected at the Meeting to serve as the Class III
Directors of the Company's Board of Directors until the 1999 Annual Meeting of
Shareholders or until such person's successor shall be duly elected and
qualified. The Board of Directors recommends the election of Joseph A. Reeves,
Jr. and Michael J. Mayell as the Class III Directors to serve for such
three-year terms. Both Mr. Reeves and Mr. Mayell are currently directors of
the Company.
Unless contrary instructions are set forth in the proxies, it is
intended that the persons executing a proxy will vote all shares represented by
such proxy for the election as director of both Mr. Reeves and Mr. Mayell.
Should either Mr. Reeves or Mr. Mayell become unable or unwilling to accept
nomination or election, it is intended that the person acting under the proxy
will vote for the election of such other person as the Board of Directors of
the Company may recommend. Management has no reason to believe that either Mr.
Reeves or Mr. Mayell will be unable or unwilling to serve if elected.
There are currently two Class III directorships up for election.
Proxies cannot be voted for other than such directorships.
DIRECTORS
Set forth below is certain information concerning the current
directors of the Company, including the nominees for election as directors at
the Meeting, with each person's business experience for at least the past five
years:
<TABLE>
<CAPTION>
PRESENT
POSITIONS EXPIRATION
WITH THE DIRECTOR OF PRESENT
NAME AGE COMPANY SINCE TERM CLASS
---- --- ------- --------- ----------- -----
<S> <C> <C> <C> <C> <C>
Joseph A. Reeves, Jr. 49 Director, Chairman of the 1990 1996 III
Board and Chief Executive
Officer
Michael J. Mayell 48 Director and President 1990 1996 III
Joe E. Kares 52 Director 1990 1998 II
Jack A. Prizzi 60 Director 1993 1997 I
</TABLE>
Joseph A. Reeves, Jr. is Chairman of the Board and Chief Executive
Officer of the Company. Prior to assuming his positions with the Company,
Mr. Reeves held similar positions with the Company's predecessor, Texas
Meridian Resources, Ltd. ("TMR") from 1988 until 1990.
Michael J. Mayell is President of the Company. Prior to assuming such
position with the Company, Mr. Mayell held a similar position with TMR from
1988 to 1990.
Joe E. Kares has been a partner with the public accounting firm of
Kares & Cihlar in Houston, Texas since 1980.
Jack A. Prizzi has served as Managing Director of Jack A. Prizzi and
Co., an investment and financial advisory firm in New York, New York, since
December 1988.
MEETINGS AND COMMITTEES OF THE BOARD
The Board of Directors held three meetings during the fiscal year
ended December 31, 1995. Each director attended at least 75% of the total
combined number of meetings held by the Board and by the committees on which
each director served.
The Board of Directors has an Executive Committee, an Audit Committee,
an Executive Compensation and Stock Option Administration Committee, a
Directors' Stock Plan Administration Committee and an Employee Compensation
Committee. The Company does not have a nominating or other similar committee.
-2-
<PAGE> 5
The Executive Committee is currently comprised of Messrs. Reeves and
Mayell and is responsible for assisting with the general management of the
business and affairs of the Company during intervals between meetings of the
Board of Directors. Twelve meetings of the Executive Committee were held in
1995.
The Audit Committee is currently comprised of Mr. Kares solely and is
charged with the duties of recommending the appointment of the independent
certified public accountants, reviewing their fees, ensuring that proper
guidelines are established for the dissemination of financial information,
meeting periodically with the independent auditors, the Board of Directors and
certain officers of the Company and its subsidiaries to ensure the adequacy of
internal controls and reporting, reviewing consolidated financial statements
and performing any other duties or functions deemed appropriate by the Board of
Directors. Five Audit Committee meetings were held in 1995.
The Executive Compensation and Stock Option Administration Committee
(the "Executive Compensation Committee") is currently comprised of Messrs.
Kares and Prizzi, the non-employee directors of the Company. This Committee
administers the Company's 1990 Employee Stock Option Plan (the "1990 Plan") and
Long-Term Incentive Plan and grants options and awards under these plans. This
Committee is also responsible for consideration of compensation matters for
Messrs. Reeves and Mayell. Two Executive Compensation Committee meetings were
held in 1995.
The Employee Compensation Committee is comprised of Messrs. Reeves and
Mayell, who are the Chief Executive Officer and President, respectively, of the
Company. The Employee Compensation Committee sets the salaries of all
employees including the elected officers and other senior executives other than
their own salaries (which are set by the Executive Compensation Committee),
grants bonuses to such elected officers and other senior executives, and
reviews guidelines for the administration of all of the Company's employee
compensation plans not administered by the Executive Compensation Committee.
Two Employee Compensation Committee meetings were held in 1995.
PROPOSAL TWO -- APPOINTMENT OF
INDEPENDENT PUBLIC ACCOUNTANTS
The Company's Audit Committee has recommended and the Board of
Directors has approved and now recommends the ratification of the appointment
of Ernst & Young LLP as the Company's independent auditors for the fiscal year
ending December 31, 1996. Approval of the ratification will require the
affirmative vote of a majority of the shares represented and voting at the
Meeting. If such vote is not obtained, the Company's management will
reconsider the matter. Abstentions will not be treated as either a vote for or
against a proposal, but will have the same effect as a vote against the
proposal.
A representative of Ernst & Young LLP will attend the Meeting with the
opportunity to make a statement if he or she desires to do so and to respond to
appropriate questions.
REPORT ON EXECUTIVE COMPENSATION
BY THE EXECUTIVE COMPENSATION COMMITTEE
GENERAL POLICY
The Company's executive compensation program is designed to attract,
motivate and retain talented management personnel and to reward management for
successful performance of their duties and improving shareholder value.
Compensation and incentives are provided through the combination of cash
salaries and bonuses, stock option awards and grants of working and net profit
interests in the Company's drilling prospects. The Company's overall
compensation package is intended to provide the Company's executive officers
with above average compensation for above average results and performance, with
an emphasis on compensation that rewards the executive for actions that have
demonstrably benefitted the long-term interests of the Company. Decisions with
respect to compensation for any particular executive officer are based on a
number of factors, including the individual's performance and contribution to
the future growth of the Company, the financial and operational results of the
Company and industry and market conditions.
Decisions with respect to the cash compensation of the Company's
executive officers are made in a bifurcated manner. An Employee Compensation
Committee of the Board of Directors, comprised of Messrs. Reeves and Mayell,
who are also the Chief Executive Officer and President, respectively, of the
Company, sets the salaries of all employees (other than their own), including
elected officers and senior executives, and grants cash bonuses to such elected
officers and other senior executives within guidelines established by the
Executive Compensation Committee. Compensation decisions with respect to
Messrs. Reeves and Mayell and decisions with respect to the granting of stock
based awards and the payment of
-3-
<PAGE> 6
other non-cash compensation for the Company's executive officers are made by an
Executive Compensation Committee, composed entirely of non-employee directors.
The members of the Executive Compensation Committee also review and may modify,
if appropriate, the decisions of the Employee Compensation Committee.
The components of the Company's executive compensation program are
more specifically summarized below.
Base Salary.
The base salaries of the Company's executive officers are determined
based on their positions with the Company, their talents and experience and
competitive market factors, including the desire by the Company to attract and
retain executives with expertise and proven success in 3-D seismic exploration.
In reviewing the base salaries of the Company's officers, the Company considers
data from published reports regarding compensation of executive officers at
other independent oil and gas companies. These reports are used as a check on
the general competitiveness of the Company's salaries and not as a means to
mathematically establish salaries within specified percentiles of salary
ranges. Although compensation at certain of the companies included in the
Company's peer group index set forth below is reviewed, all of such companies
are not used in the analysis.
During 1995, base salary increases were made to each of the Company's
executive officers, including Messrs. Reeves and Mayell. These increases
ranged from approximately $3,500 to $12,900. Mr. Reeves, the Company's Chief
Executive Officer, and Mr. Mayell, the Company's President and Chief Operating
Officer, each received an increase in his base salary of approximately $12,900.
Bonus Compensation.
Bonus compensation is provided to the Company's executive officers
from time to time based on the financial results of the Company and various
subjective factors, including the executive's contribution to the Company's
success in finding reserves and acquiring prospects, identifying and obtaining
sources of capital for the Company and increasing shareholder value. With
respect to the compensation of Messrs. Reeves and Mayell, bonus compensation is
intended to constitute a material portion of their annual cash compensation
such that a significant portion of their annual compensation is directly
related to performance.
Each of Messrs. Reeves and Mayell received cash bonuses for 1995 of
$341,864. These bonuses were intended to reward them for the significant
contributions that they made to both the operations and finances of the Company
in 1995. Among the contributions and accomplishments considered by the
Executive Compensation Committee in awarding these bonuses were (i) the
Company's successful exploration and development activities that increased the
Company's reserves at December 31, 1995, by over 64% after production over
reserves at December 31, 1994, (ii) the Company's successful public offering in
July, 1995, (iii) their leadership in furthering recognition of the Company as
a leader in 3-D seismic exploration and (iv) various important prospect and
seismic lease option acquisitions made in 1995 that are expected to benefit the
Company in 1996 and beyond.
Prospect Participation.
The Executive Compensation Committee believes that one of the best
means of motivating the Company's employees to identify and pursue desirable
exploration prospects is for the employees to receive an actual pecuniary
interest in the Company's prospects. In this regard, the Company has a policy
of granting to its executive officers and key employees the right to
participate in its prospects either through the right to purchase a working
interest in a prospect or through the receipt of a net profits interests in the
prospect. The type of participation and size of interest will vary depending
on the level and responsibility of the executive and the nature and cost of the
prospect. Historically, Messrs. Reeves and Mayell have received working
interests while the Company's other executive officers have received net
profits interests. The type and nature of the interests granted is also
considered in connection with decisions as to the amount of cash compensation
to be provided given the fact that working interests require the executive to
fund his or her portion of the cost of the well while such costs are paid by
the Company with a net profits interests.
During 1994, each of Messrs. Reeves and Mayell was granted a 2.00% net
profits interest in various prospects owned by the Company in 1994 and Mr.
Pennington was granted a 1.667% net profits interest in various prospects owned
by the Company in 1994. Ms. Maddox and Mr. DeLano were each granted a .25% net
profits interest in various prospects owned by the Company in 1994. It is
currently contemplated that similar grants will be made to such persons with
respect to new prospects.
-4-
<PAGE> 7
LONG-TERM INCENTIVE COMPENSATION
The Executive Compensation Committee also believes that long-term
incentive compensation is an important component of the Company's compensation
program and that the value of long-term incentive compensation should be
directly related to increases in shareholder value. Thus, in addition to base
salaries, bonuses and participation rights in prospects, the Company provides
long-term incentive compensation to its executive officers through stock
options under the Company's stock option plan. The Company also issued, to
Messrs. Reeves and Mayell, executive officer warrants, which were amended in
1994 to make the value of the warrants to the executive more directly related
to their continued employment with the Company.
Stock Options and Awards.
Under the Company's stock option plan, the Executive Compensation
Committee has the authority to grant options to purchase shares of Common Stock
to the Company's executive officers and key employees for terms of up to ten
years, with exercise prices at or above 50% of the market price of the Common
Stock at the time of grant and with vesting conditions established by the
Executive Compensation Committee. Awards under this plan are intended to
provide incentives to the participants to increase shareholder value by
providing benefits that are directly related to the market value of the Common
Stock. The Executive Compensation Committee believes that options provide a
desirable form of incentive to the Company's executive officers in that options
received by an executive officer will be of no value to the officer unless the
value of the Common Stock increases. During 1995, 172,750 options to purchase
shares of Common Stock were granted by the Company to its executive officers
and employees.
The Company has also adopted, the Long Term Incentive Plan (the
"Incentive Plan"). The Incentive Plan is intended to supplement the Company's
current stock option plan and to allow the Executive Compensation Committee to
make grants of stock options, restricted stock and performance awards as the
Executive Compensation Committee deems appropriate. The terms of the awards,
including vesting, specific performance goals and other matters will be
established by the Executive Compensation Committee.
Decisions as to whether to grant options and other awards to an
executive officer are made by the Executive Compensation Committee in light of
existing circumstances, including the executive officer's contributions to the
Company over the prior year and the expected contributions by the executive
officer in the future. If an option or stock based award is granted to an
executive officer, the number of shares of Common Stock subject to the granted
option or award will be based on, among other things, the level of
responsibility of the executive officer, the anticipated contribution of the
officer to the future growth of the Company, the number of shares that the
Committee believes would be necessary to provide the executive officer with a
meaningful incentive to improve shareholder value and the potential dilution
that might result from the grant. The Executive Compensation Committee also
considers the amount and terms of the options and other stock based benefits
held by the executive officers. Vesting requirements will generally be placed
on stock based awards in order to relate the benefits of any award granted to
an executive officer to the continued employment of the executive officer with
the Company.
RECENT TAX LEGISLATION
Section 162(m) of the Code currently imposes a $1 million limitation
on the deductibility of certain compensation paid to the Company's five highest
paid executives. Excluded from the limitation is compensation that is
"performance based". For compensation to be performance based, it must meet
certain criteria, including being based on predetermined objective standards
approved by the stockholders of the Company. The Company believes that
compensation relating to options granted under the 1990 Stock Option Plan
should be excluded from the $1 million limitation. In addition, the Incentive
Plan is designed to allow for various awards to be granted under the plan to be
excluded from the $1 million limitation under certain circumstances, including
a requirement that eligible awards be granted at a time when the Executive
Compensation Committee is comprised of at least two persons who would qualify
as "outside directors" under Section 162(m). As noted above, the Executive
Compensation Committee does not currently satisfy the requirements of Section
162(m) due to Mr. Kares' firm having received certain compensation from the
Company during 1994. The Executive Compensation Committee intends to take into
account the potential application of Section 162(m) with respect to incentive
compensation awards and other compensation decisions made by it in the future.
Executive Compensation Committee
Joe E. Kares
Jack A. Prizzi
-5-
<PAGE> 8
COMPENSATION COMMITTEE INTERLOCKS
AND INSIDER PARTICIPATION
As disclosed above, certain components of the compensation of the
executive officers of the Company, other than Messrs. Reeves and Mayell, are
determined by the Employee Compensation Committee of the Board of Directors of
the Company consisting of Messrs. Reeves and Mayell. The decisions of this
Committee, however, are subject to review and modification by the Executive
Compensation Committee.
Joe E. Kares, a member of the Executive Compensation Committee, is a
partner in the public accounting firm of Kares & Cihlar, which provided the
Company and its affiliates with accounting services for 1995 and received fees
therefor of approximately $68,000. These fees exceeded 5% of the gross
revenues of Kares & Cihlar for 1995. The Company believes that these fees were
equivalent to the fees that would have been paid to similar firms providing its
services in arm's length transactions. It is anticipated that Kares & Cihlar
will be phasing out services rendered to the Company in 1996.
COMPENSATION
EXECUTIVE COMPENSATION
The following tables contain compensation data for the Chief Executive
Officer and four other executive officers whose 1995 salary and annual bonus
compensation exceeded $100,000.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Long-Term
Annual Compensation Compensation
------------------------------------------------ -------------------
Other Securities
Name and Annual Underlying All Other
Principal Position Year Salary($) Bonus($) Compensation($)(1) Options(#) Compensation($)(3)
------------------ ---- --------- -------- ------------------ ---------- ------------------
<S> <C> <C> <C> <C> <C> <C>
Joseph A. Reeves, Jr. 1995 315,124 341,864 -- 35,000 (2) 10,850
CEO 1994 305,882 313,218 119,150 -- 10,926
1993 290,814 365,400 -- 156,000 (2) 16,179
Michael J. Mayell 1995 315,124 341,864 35,000 (2) 10,850
President 1994 305,882 313,218 119,150 -- 10,926
1993 290,814 365,400 -- 156,000 (2) 16,179
Alan S. Pennington 1995 152,487 21,913 -- 15,000 10,519
Vice President -- 1994 145,830 25,659 98,895 -- 10,926
Geology of TMRX 1993 131,709 10,938 1,291 30,000 9,217
Nicola L. Maddox 1995 108,730 9,031 -- 15,000 8,748
Vice President -- 1994 104,548 8,683 14,894 -- 8,100
Land of TMRX 1993 92,017 8,333 778 20,000 5,505
Lloyd V. DeLano
Vice President -- 1995 104,355 8,667 -- 17,500 8,582
Director of Account- 1994 95,611 18,333 14,894 -- 7,873
ing of TMRX 1993 90,759 7,350 533 30,000 5,393
</TABLE>
____________
(1) The Company has adopted a program under which net profit interests are
granted to its executive officers and other key employees in prospects
and wells in which the Company is pursuing and drilling. In general,
the net profit interests range from 0.25% to 2.00% of any well and are
subject to proportional reduction to the Company's interests. During
1994, net profit interests aggregating 6.17% were granted to 5
executive officers and key employees of the Company in various
prospects owned by the Company. Although such grants were intended to
provide long-term incentive for the executive officer or employee by
aligning his or her interests with those of the Company in its
drilling efforts, such grants are not subject to vesting, the
continued employment of the individual
-6-
<PAGE> 9
with the Company or other conditions. Accordingly, such grants are
considered part of the Company's annual compensation package and not
compensation under a long-term incentive plan. Each grant of a net
profits interest has been valued based on a third party appraisal of
the interest granted. All amounts reflected in this column are
attributable to such grants.
(2) Excludes 714,000 shares of Common Stock issuable to each of Messrs.
Reeves and Mayell with respect to Executive Warrants received by them
in connection with the Company's 1988 restructuring and acquisition of
Walker Energy Partners and which were amended in 1994 with approval of
shareholders to make various changes to more closely align the terms
of the warrants with the continued employment of the officers with the
Company.
(3) Company contributions to its 401(k) plan.
OPTION GRANTS IN FISCAL 1995
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE VALUE AT
ASSUMED ANNUAL RATES
OF STOCK PRICE
APPRECIATION FOR OPTION
INDIVIDUAL GRANTS TERM
- -------------------------------------------------------------------------------- -------------------------------
% of Total
Number of Options
Shares Granted to Exercise
Underlying Employees in Price Expiration
Name Options Granted Fiscal Year ($/share) Date 5% ($) 10% ($)
---- --------------- ----------- --------- ---------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Joseph A. Reeves, Jr. 10,000 5.8 11.00 8/22/05 179,178 285,312
25,000 14.5 10.38 8/29/05 422,495 672,752
Michael J. Mayell 10,000 5.8 11.00 8/22/05 179,178 285,312
25,000 14.5 10.38 8/29/05 422,495 672,752
Alan S. Pennington 10,000 5.8 11.00 8/22/05 179,178 285,312
5,000 2.9 10.38 8/29/05 84,499 134,550
Nicola L. Maddox 10,000 5.8 11.00 8/22/05 179,178 285,312
5,000 2.9 10.38 8/29/05 84,499 134,550
Lloyd V. DeLano 10,000 5.8 11.00 8/22/05 179,178 285,312
7,500 4.3 10.38 8/29/05 126,748 201,826
</TABLE>
AGGREGATE OPTION EXERCISES IN FISCAL YEAR 1995
AND DECEMBER 31, 1995 OPTION VALUE
<TABLE>
<CAPTION>
Value of Unexercised
Number of Unexercised In-the-Money Options
Options at December 31, at December 31,
Shares 1995 (#) 1995 ($)
Acquired on Value Exercisable/ Exercisable/
Name Exercise (#) Realized ($) Unexercisable Unexercisable
---- ------------ ------------ ------------- -------------
<S> <C> <C> <C> <C>
Joseph A. Reeves, Jr. (1) -- -- 137,250/53,750 904,063/218,437
Michael J. Mayell (1) -- -- 137,250/53,750 904,063/218,437
Alan S. Pennington -- -- 45,000/20,000 396,250/71,250
Nicola L. Maddox -- -- 16,250/18,750 94,063/68,437
Lloyd V. DeLano -- -- 25,625/21,875 148,281/77,344
- ---------------
</TABLE>
(1) Excludes (i) warrants to purchase 146,134 shares of Common Stock at
$0.65 per share granted to each of Messrs. Reeves and Mayell in
October 1990 in connection with the Company's formation and (ii)
warrants to purchase 714,000 shares of Common Stock at $5.85 per share
pursuant to the Executive Warrants held by each of Messrs. Reeves and
Mayell. The value of these warrants at December 31, 1995, based on
the difference between the market price of the Common Stock at
December 31, 1995, and the erercise price of the Warrants, was
$7,448,123 for each of Messrs. Reeves and Mayell.
-7-
<PAGE> 10
[STOCK PERFORMANCE GRAPH]
<TABLE>
<CAPTION>
AMEX Sm
AMEX Nat Cap
Market Resources E&P
The Company Index Index Index
----------- ------ --------- -----
<S> <C> <C> <C> <C>
1991 .......................... 255 128 87 123
1992 .......................... 709 130 76 125
1993 .......................... 1,200 155 95 148
1994 .......................... 1,418 141 94 131
1995 .......................... 1,982 178 114 169
</TABLE>
For the last two years the Company has used as its peer group the
Principal Financial Securities' Small Capitalization Exploration and Production
Index which includes 18 exploration and production companies which in February
1994 had equity market capitalization ranging between $10 million and $110
million. Two problems have arisen from using the present index (1) the index
as presented in 1994 is not longer published on a regular basis and (2) the
Company's equity market capitalization has substantially exceeded the $110
million upper limit. Accordingly, the Company has changed its current peer
group to the American Stock Exchange's Natural Resources Industrial Index on
the basis that such index is more appropriate in the proxy statement
presentation. The Company's prior peer group index is set forth for comparison
purposes.
-8-
<PAGE> 11
COMPENSATION OF DIRECTORS
Non-employee directors of the Company receive an annual retainer,
payable quarterly, of $20,000. Non-employee directors also are reimbursed for
expenses incurred in attending Board of Directors and committee meetings,
including those for travel, food and lodging. Directors and members of
committees of the Board of Directors who are employees of the Company or its
affiliates are not compensated for their Board of Directors and committee
activities.
The Company has a Non-Employee Director Stock Option Plan (the
"Director Stock Option Plan") pursuant to which options to purchase up to
270,000 shares of Common Stock may be granted. Under the Director Stock Option
Plan each non-employee director is granted, on the date of his appointment,
election, reappointment or re-election as a member of the Board of Directors,
an option ("Director Option") for 15,000 shares of Common Stock at an exercise
price equal to the fair market value of a share of Common Stock on the date of
grant. The duration of each Director Option is five years from the date of
grant, and each Director Option may be exercised in whole or in part at any
time after the date of grant; provided, however, that the option vests with
respect to 25% of the shares of Common Stock covered by such Director Option
one year after the date of grant, with respect to an additional 25% of such
shares of Common Stock two years after the date of grant, and with respect to
all remaining shares of Common Stock three years after the date of grant.
There are currently outstanding options to acquire 45,000 shares under the
Directors Stock Option Plan with a weighted average exercise price of $9.44 per
share.
In addition to the options granted under the Director Stock Option
Plan, on December 30, 1993, Messrs. Kares and Prizzi, non-employee directors of
the Company, were each granted options to purchase 25,000 shares of Common
Stock at an exercise price of $8.125 per share, the closing market price of the
Common Stock on the date of grant. These options expire on December 30, 1998,
and have terms, including vesting and rights of exercise substantially
identical to the Director Options. These grants were made as one-time grants
to provide additional incentive to the Company's non-employee directors and to
more closely align their interests to the long-term interest of the Company's
shareholders.
EMPLOYMENT AGREEMENTS
The Company has entered into an employment agreement ("Employment
Agreement") with each of Messrs. Reeves and Mayell. Each Employment Agreement
is for a term of three years, renewable annually for a term to extend three
years from such renewal date. Each Employment Agreement provides for
compensation in a minimum amount of $289,800 per annum, to be reviewed at least
annually for possible increases, and annual bonuses and other perquisites in
accordance with company policy. In the event either of Messrs. Reeves or
Mayell terminates his employment for "Good Reason" (as defined below), or is
terminated by the Company for other than "Good Cause" (as defined below), such
individual would receive a cash lump sum payment equal to the sum of (i) the
base salary for the remainder of the employment period under the Employment
Agreement, (ii) an amount equal to the last annual bonus paid to him, (iii) two
times the sum of his annual base salary and last bonus, (iv) all compensation
previously deferred and any accrued interest thereon, (v) a lump sum retirement
benefit equal to the actuarial equivalent of the benefits lost by virtue of the
early termination of the employee and (vi) continuation of benefits under the
Company's benefit plans. In the event either of Messrs. Reeves or Mayell dies
or is terminated by the Company for Good Cause, such individual or such
individual's estate, as applicable, would receive all payments then due him
under the Employment Agreement through the date of termination, including a
prorated annual bonus and any compensation previously deferred. Each of
Messrs. Reeves and Mayell is also entitled under each Employment Agreement to
certain gross-up payments if an excise tax is imposed pursuant to Section 4999
of the Code, which imposes an excise tax on certain severance payments in
excess of three times an annualized compensation amount following certain
changes in control, on any payment or distribution made to either of them.
The term "Good Reason" is defined in each Employment Agreement, with
respect to each of Messrs. Reeves and Mayell, generally to mean (i) a change in
the nature or scope of the duties or responsibilities of such individual,
unless remedied by the Company; (ii) any failure by the Company to pay any form
of compensation stated in each Employment Agreement, unless remedied by the
Company; (iii) requiring such individual to be based at any office or location
30 miles or more from the current location of the Company, other than travel
reasonably required in the performance of such individual's responsibilities;
(iv) any purported termination by the Company of such individual's employment
other than due to death or for Good Cause; or (v) any failure of the Company to
require a successor of the Company to assume the terms of the Employment
Agreement. The term "Good Cause" is defined in each Employment Agreement
generally to mean (i) such individual has been convicted of a felony that is no
longer subject to direct appeal; (ii) such individual has been adjudicated to be
mentally incompetent so as to affect his ability to serve the Company that is no
longer subject to direct appeal or (iii) such individual has been found guilty
of fraud; or willful misfeasance so as to materially damage the Company that is
no longer subject to direct appeal.
-9-
<PAGE> 12
EXECUTIVE OFFICERS
The following table provides information with respect to the executive
officers and key employees of the Company, including executive officers of
Texas Meridian Resources Exploration, Inc., a wholly owned subsidiary of the
Company ("TMRX"). Each executive officer has been elected to serve until his
or her successor is duly appointed or elected by the Board of Directors or his
or her earlier removal or resignation from office.
<TABLE>
<CAPTION>
YEAR FIRST
ELECTED
NAME OF OFFICER POSITION WITH THE COMPANY AGE AS OFFICER
--------------- ------------------------- --- ----------
<S> <C> <C> <C>
Joseph A. Reeves, Jr. Chairman of the Board and Chief 49 1990
Executive Officer of the Company
Michael J. Mayell Director and President of the Company 48 1990
Lloyd V. DeLano Vice President -- Director of Accounting of TMRX 45 1993
Vice President - Production
Ronald T. Ivy of TMRX 44 1995
Vice President - Land of TMRX
Nicola L. Maddox 40 1993
J. Larry Mathews Vice President -- Controller of TMRX 47 1990
Alan S. Pennington Vice President -- Development 42 1990
of TMRX
Daniel L. Smith Vice President -- Exploration 59 1996
of TMRX
Michael R. Stamatedes Vice President - Geophysics 39 1996
of TMRX
</TABLE>
For additional information regarding Messrs. Reeves and Mayell, see
"Directors" above.
Lloyd V. DeLano joined the Company in October 1992 and was named as
Vice President-Director of Accounting of TMRX in April of 1993. Mr. DeLano is
a Certified Public Accountant with 22 years of oil and natural gas experience.
Prior to joining TMRX, he was Controller of Elf Aquitaine Operating, Inc. from
August 1988 until February 1991. In February 1991, Mr. DeLano left Elf
Aquitaine to form a company in the electropolish industry and from September
1991 to October 1992, he performed contract work for various companies in the
oil and gas industry, including TMRX.
Ronald T. Ivy joined the Company in August 1995 as the Vice
President-Production of TMRX in charge of drilling and production operations.
Mr. Ivy is a Registered Professional Engineer in the State of Texas with over
21 years in oil and gas operations experience. Mr. Ivy formed his own company,
Tap Resources, Inc., in 1994 with the objective of exploiting shallow,
development gas wells. Prior to that time, he spent six years with Norcen
Explorer as operations manager.
Nicola L. Maddox joined the Company in February 1993 as the Vice
President-Land of TMRX. Mrs. Maddox is a Certified Professional Landman and
was the Eastern Region Land Director for Phillips Petroleum Company in Houston,
Texas during the four years immediately preceding her employment with the
Company.
J. Larry Mathews is Vice President-Controller of TMRX. Mr. Mathews is
a Certified Public Accountant. In February 1987, Mr. Mathews accepted a
position as Controller with Texas Meridian Corporation and has been employed by
TMRX in his current position since April 1993.
Alan S. Pennington joined the Company in August 1989 and is Vice
President-Geology of TMRX and has been employed by TMRX in his current position
since May 1992.
Daniel L. Smith was appointed Vice President-Exploration in April
1996. Prior to that he was an independent geologist and a consultant to TMRX
since March 1992. Before joining TMRX Mr. Smith was part owner , executive
vice president and a director of Texoil Company
-10-
<PAGE> 13
Michael R. Stamatedes joined the Company in May 1995 and was named as
Vice-President-Geophysics of TMRX in April 1996. Mr. Stamatedes was staff
geophysicist for Benton Oil and Gas Company for 2-1/2 years prior to joining
the Company. From 1980 to 1992 he was a director of INEXS, a 3-D seismic
consulting firm.
There are no family relationships among the officers and directors of
the Company and TMRX.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information, as of April 26, 1996, with
respect to the beneficial ownership of Common Stock by (a) each director, (b)
each named executive officer in the Summary Compensation Table, (c) each
shareholder known by the Company to be the beneficial owner of more than 5% of
the Common Stock and (d) all officers and directors of the Company as a group.
<TABLE>
<CAPTION>
NO. OF SHARES
BENEFICIALLY
NAME OWNED PERCENT(1)
---- ------------ ----------
<S> <C> <C>
Joseph A. Reeves, Jr. (2) . . . . . . . . . . . . . . . . . . . 1,360,152 8.82
15995 N. Barkers Landing, Suite 300
Houston, Texas 77079
Michael J. Mayell (3) . . . . . . . . . . . . . . . . . . . . . 1,300,418 8.43
15995 N. Barkers Landing, Suite 300
Houston, Texas 77079
Alan S. Pennington (4) . . . . . . . . . . . . . . . . . . . . 50,419 *
Nicola L. Maddox (5) . . . . . . . . . . . . . . . . . . . . . 17,353 *
Lloyd V. DeLano (6) . . . . . . . . . . . . . . . . . . . . . . 26,926 *
Jack A. Prizzi (7) . . . . . . . . . . . . . . . . . . . . . . 37,750 *
Joe E. Kares (8) . . . . . . . . . . . . . . . . . . . . . . . 23,750 *
All officers and directors . . . . . . . . . . . . . . . . . 2,849,611 17.19
As a group (11 persons)(2)(3)(4)(5)(6)(7)(8)(9)
Ardsley Advisory Partners (10) . . . . . . . . . . . . . . . . 1,157,000 8.02
646 Steamboat Road
Greenwich, Connecticut 06830
Kayne-Anderson Group . . . . . . . . . . . . . . . . . . . . . 965,000 6.69
c/o Kayne, Anderson Investment Mgmt.
1800 Avenue of the Stars, Suite 1425
Los Angeles, California 90067
J. P. Morgan & Co. Incorporated (11) . . . . . . . . . . . . . 854,000 5.92
60 Wall Street
New York, New York 10260
Warburg, Pincus Counsellors, Inc. (12) . . . . . . . . . . . 1,137,800 7.88
466 Lexington Avenue
New York, New York 10017
</TABLE>
__________________________
* Less than 1%
The footnotes are on the following page.
-11-
<PAGE> 14
(1) Shares of Common Stock which are not outstanding but which can be
acquired by a person upon exercise of an option or warrant within
sixty days are deemed outstanding for the purpose of computing the
percentage of outstanding shares beneficially owned by such person.
(2) Includes 146,134 shares, 714,000 shares and 137,250 shares of Common
Stock that Mr. Reeves has the right to acquire upon the exercise of
the General Partner Warrant, Executive Warrants and a stock option
under the Company's 1990 Stock Option Plan, respectively.
(3) Includes 146,134 shares, 714,000 shares and 137,250 shares of Common
Stock that Mr. Mayell has the right to acquire upon the exercise of
the General Partner Warrant, Executive Warrants and a stock option
under the Company's 1990 Stock Option Plan, respectively.
(4) Includes 45,000 shares of Common Stock that Mr. Pennington has the
right to acquire upon the exercise of a stock option under the
Company's 1990 Stock Option Plan.
(5) Includes 16,250 shares of Common Stock that Mrs. Maddox has the right
to acquire upon the exercise of a stock option under the Company's
1990 Stock Option Plan.
(6) Includes 25,625 shares of Common Stock that Mr. DeLano has the right
to acquire upon the exercise of a stock option under the Company's
1990 Stock Option Plan.
(7) Includes 31,250 shares of Common Stock that Mr. Prizzi has the right
to acquire upon the exercise of Director Options.
(8) Includes 23,750 shares of Common Stock that Mr. Kares has the right to
acquire upon the exercise of Director Options.
(9) Includes 13,875 shares of Common Stock that other officers have the
right to acquire upon the exercise of a stock option under the
Company's 1990 Stock Option Plan.
(10) Ardsley Advisory Partners have sole power to vote 538,000 shares and
sole power to disposal of all such shares.
(11) J. P. Morgan & Co. Incorporated has shared voting and dispository
power for all shares.
(12) Warburg, Pincus Counsellors, Inc. has sole power to vote 737,700
shares and sole power to disposal of all such shares.
COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's officers and directors, and persons who beneficially own more then
ten percent of a registered class of the Company's equity securities, to file
reports of ownership and changes in ownership with the Securities and Exchange
Commission. Officers, directors and greater than ten-percent shareholders are
required by the regulations promulgated under Section 16(a) to furnish the
Company with copies of all Section 16(a) forms they file.
Based solely on its review of the copies of such forms received by it,
or written representations from certain reporting persons that no Forms 5 were
required for those persons, the Company believes that, during the period from
January 1, 1995 through December 31, 1995, all filing requirements applicable
to officers, directors and greater than ten-percent shareholders were complied
with.
-12-
<PAGE> 15
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
In the ordinary course of business, the Company offers participation
in exploration prospects to industry partners. Terms of each participation
vary depending on the risk and economic conditions of the industry. In
addition, in an effort to provide the Company's executive officers and key
employees with additional incentive to identify and develop successful
exploratory prospects for the Company, the Company has adopted a policy of
offering to its principal executive officers and key employees responsible for
the identification and development of prospects the right to participate in
each of the prospects pursued by the Company. Such participation is required
to be on the same terms and conditions as the Company and its outside partners.
Other than prospects in the Chocolate Bayou Field in which Messrs. Reeves and
Mayell each have a right to have a 3.3% working interest and prospects
completed prior to 1994 in which Messrs. Reeves and Mayell each has a working
interest of 3.5%, the maximum percentage interest which Messrs. Reeves and
Mayell may currently elect to participate in any prospect is a 1.5% working
interest for each Messrs. Reeves and Mayell and a 1% working interests for Paul
E. Faulk, the Company's reservoir engineer.
During 1995, the following individuals, either personally or through
wholly-owned or affiliated corporations, participated as working interest
owners:
<TABLE>
<CAPTION>
Amount Paid
or
Obligation
Individual Prospect(2) Incurred(2)(3)
---------- ----------- --------------
<S> <C> <C>
Joseph A. Reeves, Jr.(1) Bayou Lafourche $ 10,541
Lake Boeuf 280,317
NE Thornwell 1,003
SW Holmwood 16,740
N Crescent Farms 616
Lake Charles 329
Chocolate Bayou 3,883
----------
$ 313,429
==========
Michael J. Mayell(1) Bayou Lafourche $ 10,541
Lake Boeuf 280,317
NE Thornwell 1,003
SW Holmwood 16,740
N Crescent Farms 616
Lake Charles 329
Chocolate Bayou 3,883
---------
$ 313,429
==========
Paul E. Faulk Chocolate Bayou $ 48,310
- --------------- ==========
</TABLE>
(1) The investments by Mr. Reeves are effected through Texas Oil
Distribution and Development, Inc. ("TODD") and the investments by Mr.
Mayell are effected through Sydson Energy, Inc. ("Sydson").
(2) Represents working interests in 7 wells, of which 3 were successful
and 2 were in progress. The average working interests in each well
acquired was 1.3% for each of Messrs. Reeves and Mayell. Each of such
working interest purchases took place prior to spudding of the
respective wells.
(3) The amounts set forth in this column represent amounts paid or payable
by the individual with respect to the well or prospect to acquire the
working interest and to pay for acquisition, drilling and completion
costs pursuant to the terms of the operating or other agreement
relating to the prospect or well. Ordinary course of business
payments with respect to operating costs have been excluded.
-13-
<PAGE> 16
Under the terms of the operating and other agreements relating to the
Company's wells and prospects, the Company, as operator, incurs various
expenses relating to the prospect or well that are then billed to the working
interest owner. During 1995, each of TODD and Sydson were indebted to the
Company for expenses paid by the Company in respect of their working interest
in various prospects and wells in which the Company acted as operator. The
largest account balance of such parties with the Company during 1995 under such
operating agreements was $537,000 for TODD and $600,000 for Sydson. No
interest was charged with respect to these outstanding amounts. As of December
31, 1995, TODD and Sydson had outstanding account balances with the Company
with respect to wells and prospects in which they were participating in the
amounts of $389,000 and $414,000, respectively, which have been netted by
amounts owed to them from the Company.
The Company believes that the granting of participation interests to
its employees in the Company's prospects promotes in them a proprietary
interest in the Company's exploration efforts that benefits the Company and its
shareholders. To achieve this objective, the Company has entered into
agreements with certain executive officers and key employees of the Company and
a trust for the benefit of all employees of the Company whereby such persons or
trust are granted net profits interests in the oil and gas production from
certain properties to the extent the Company acquires a mineral interest
therein. The net profits interest received is equivalent to an overriding
royalty interest less a proportionate share of the costs incurred by the
Company and its participating working interest owners for landowner royalties,
severance and production taxes and normal lease operating expenses, exclusive
of drilling well overhead rates and costs associated with the establishment or
enhancement of production. The interest to be granted with respect to any
property will be proportionately reduced to the extent the interest of the
Company and its participating working interest owners is less than 100%. The
net profits interest for an individual officer or employee applies to all
properties on which the Company expends funds during the employee's employment
with the Company for the identification or acquisition of geological, land or
engineering data or for the drilling of a well. The net profits interest with
respect to a particular property continues following the officer's termination
of employment so long as there is not a three-year period following the
expiration or termination of the last mineral interest in such property during
which the Company does not have a mineral interest therein. During such time
as the officer has a net profits interest in a particular property, the
agreement provides that the Company will have an exclusive option to acquire
leases and other mineral interests therein.
During 1994, each of Messrs. Reeves and Mayell was granted a 2.00% net
profits interest in various prospects owned by the Company in 1994 and Mr.
Pennington was granted a 1.667% net profits interest in various prospects owned
by the Company in 1994. Ms. Maddox and Mr. DeLano were each granted a .25% net
profits interest in various prospects owned by the Company in 1994. It is
currently contemplated that similar grants will be made to such persons with
respect to new prospects.
OTHER BUSINESS
Management does not intend to bring any business before the Meeting
other than the matters referred to in the accompanying notice and at this date
has not been informed of any matters that may be presented to the Meeting by
others. If, however, any other matters properly come before the Meeting, it is
intended that the persons named in the accompanying proxy will vote, pursuant
to the proxy, in accordance with their best judgment on such matters.
-14-
<PAGE> 17
SHAREHOLDER PROPOSALS
Any proposal by a shareholder to be presented at the Company's 1997
Annual Meeting of Shareholders must be received by the Company no later than
January 17, 1997, in order to be eligible for inclusion in the Company's Proxy
Statement and proxy used in connection with such meeting.
By order of the Company's Board of Directors
/s/ JOSEPH A. REEVES, JR.
Joseph A. Reeves, Jr.
Chairman of the Board and
Chief Executive Officer
May 17, 1996
-15-
<PAGE> 18
TEXAS MERIDIAN RESOURCES CORPORATION
Proxy
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned shareholder of Texas Meridian Resources Corporation, a Texas
corporation (the "Company"), hereby constitutes and appoints Joseph A. Reeves,
Jr. and Michael J. Mayell, and each of them, his true and lawful agents and
proxies, as proxies, with full power of substitution in each, to vote, as
designated on the reverse side, all shares of Common Stock, $.01 par value, of
the Company which the undersigned would be entitled to vote at the Annual
Meeting of Shareholders of the Company to be held June 20, 1996 and at any
adjournment(s) thereof, on the following matters more particularly described in
the Proxy Statement dated May 15, 1996.
(To Be Signed On REVERSE SIDE)
<PAGE> 19
/X/ PLEASE MARK YOUR
VOTES AS IN THIS
EXAMPLE
FOR THE WITHHOLD AUTHORITY TO
FOLLOWING VOTE FOR THE NOMINEE(S)
1.Election of / / / / NOMINEES: Joseph A. Reeves, Jr.
Class III Michael J. Mayell
Director
UNLESS OTHERWISE INDICATED, THIS PROXY WILL BE VOTED FOR THE ELECTION AS
DIRECTORS OF THE NOMINEES LISTED HEREIN AND FOR APPROVAL OF PROPOSAL NO. 2
FOR AGAINST ABSTAIN
2.Proposal to ratify the appointment of / / / / / /
Ernst & Young LLP as the Company's
independent auditors for the fiscal
year ending December 31, 1996.
3.In their discretion the proxies are / / / / / /
authorized to vote upon such other
business as may properly come before
the meeting.
Receipt is hereby acknowledged of the Notice of Annual Meeting of
Shareholders and Proxy Statement, each dated May 15, 1996, and the
Annual Report to Shareholders of the Company for the year ended
December 31, 1995.
Please mark, sign, date and return this proxy card promptly using
the enclosed envelope.
SIGNATURE(S)____________________________________ DATE___________________1996
NOTE: Please sign your name exactly as name appears hereon. Co-fiduciaries and
joint owners must each sign. When signing as Attorney, executor,
administrator, trustee or guardian, please give your full title as such.
If a corporation, please sign in the full corporate name by the president
or other authorized officer. If a partnership, please sign in the
partnership name by authorized person.
