Annual General Meeting of Shareholders
June 17, 1996
Dear Shareholder:
It's a pleasure for us to extend to you a cordial invitation to attend
the Annual General Meeting of Shareholders of Coastal Caribbean Oils & Minerals,
Ltd. for the fiscal year 1995 at the offices of Conyers, Dill & Pearman,
Clarendon House, Church Street, Hamilton, Bermuda on Monday, June 17, 1996 at
11:00 A.M..
We know that most of our Shareholders are unable personally to attend
the Annual Meeting. Proxies are solicited so that each shareholder has an
opportunity to vote on all matters that are scheduled to come before the
meeting. Whether or not you plan to attend, please take a few minutes now to
vote, sign, date and return your proxy in the enclosed postage-paid envelope.
Regardless of the number of shares you own, your vote is important.
Besides helping us conduct business at the annual meeting, there is
another reason for you to return your proxy vote card. Under the abandoned
property law of some states, a shareholder may be considered "missing" if that
stockholder has failed to communicate with us in writing. The return of your
proxy vote card qualifies as written communication with us.
The Notice of Annual General Meeting and Proxy Statement accompanying
this letter describe the business to be acted on at the meeting.
As in the past, members of management will review with you the
Company's results and will be available to respond to questions during the
meeting.
We look forward to seeing you at the meeting.
Sincerely,
Benjamin W. Heath
May 17, 1996 President
COASTAL CARIBBEAN OILS & MINERALS, LTD.
Clarendon House, Church Street
Hamilton, Bermuda
NOTICE OF ANNUAL GENERAL MEETING OF SHAREHOLDERS
June 17, 1996
NOTICE IS HEREBY GIVEN that the Annual General Meeting of Shareholders
of COASTAL CARIBBEAN OILS & MINERALS, LTD. (the "Company") will be held on
Monday, June 17, 1996, at 11:00 A.M., local time, at the offices of Conyers,
Dill & Pearman, Clarendon House, Church Street, Hamilton, Bermuda, for the
following purposes:
To receive the report of the independent auditors and the financial
statements for the year ended December 31, 1995 and to vote on the following:
1. To elect five members of the Board of Directors;
2. To ratify the appointment of independent auditors of the Company for the
year ending December 31, 1996;
3. To transact such other business as may properly come before the meeting
or any adjournment or postponement thereof.
This notice and proxy statement and the enclosed form of proxy are
being sent to Shareholders of record as of May 17, 1996 to enable such holders
to state their instructions with respect to the voting of their shares. Proxies
should be returned to the American Stock Transfer & Trust Company, 40 Wall
Street, 46th Floor, New York, N.Y. 10005 in the reply envelope enclosed.
By order of the Board of Directors,
James R. Joyce
Assistant Secretary
Dated: May 17, 1996
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RETURN OF PROXIES
SHAREHOLDERS WHO ARE UNABLE TO ATTEND THE ANNUAL GENERAL MEETING ARE
URGED TO VOTE BY PROMPTLY SIGNING, DATING, AND RETURNING THE ACCOMPANYING PROXY
IN THE REPLY ENVELOPE PROVIDED.
-------------------------------------------------------------------------------
COASTAL CARIBBEAN OILS & MINERALS, LTD.
Clarendon House, Church Street
Hamilton, Bermuda
---------------
PROXY STATEMENT
---------------
GENERAL INFORMATION
This proxy statement is furnished to the Shareholders of Coastal
Caribbean Oils & Minerals, Ltd., a Bermuda company (the "Company"), in
connection with the solicitation of proxies on behalf of the Board of Directors
for use at the Annual General Meeting of Shareholders to be held at the offices
of Conyers, Dill & Pearman, Clarendon House, Church Street, Hamilton, Bermuda,
on Monday, June 17, 1996 at 11:00 A.M., local time, and at any adjournments or
postponements thereof. The notice of meeting, proxy statement and proxy are
being mailed on or about May 17, 1996. A proxy may be revoked at any time before
it is voted by (1) so notifying the Company in writing; (2) signing and dating a
new and different proxy card; or (3) voting your shares in person or by your
duly appointed agent at the meeting.
The Company expects to solicit proxies primarily by mail. To the extent
necessary to assure sufficient representation of shares at the meeting, proxies
may be solicited by telephone and in person. The Company will request brokers,
banks and other nominees to forward copies of proxy material to beneficial
owners or other persons for whom they hold common stock and to obtain authority
for the execution and delivery of proxies. In addition, the Company has retained
Morrow & Co. Inc., to assist in the distribution and solicitation of proxy
materials for an estimated fee of $3,500.00 plus out-of-pocket expenses. The
only other expenses anticipated are the ordinary expenses incurred in connection
with the preparation, assembling, mailing and other distribution of the
material. All costs of the solicitation will be borne by the Company.
The record date for the determination of Shareholders entitled to
notice of and to vote at the meeting has been fixed by the Board of Directors as
the close of business on May 17, 1996. On that date there were 33,373,632 shares
of common stock outstanding, which were held by approximately 14,100
Shareholders of record. The holders of twenty-five percent of the total number
of shares entitled to be voted at the meeting, present in person or by proxy,
shall constitute a quorum for the transaction of business. Each outstanding
share is entitled to one vote at the meeting. Abstentions and broker votes will
be counted neither as votes in favor of nor as votes opposed to any proposition
brought before the meeting.
Bye-Law No. 21 of the Company provides as follows:
Any matters to be voted upon at any meeting of Shareholders
must be approved, not only by a majority of the shares voted
at such meeting, but also by a majority in number of the
Shareholders present in person or by
proxy and entitled to vote thereon. When shares are held by
members or Shareholders of another company, association or
similar entity and such persons act in concert, or when shares
are held by or for a group of Shareholders whose members act
in concert by virtue of any contract, agreement or
understanding, such persons shall be deemed to be one
shareholder for the purpose of this Bye-Law. In the case of
the election of Directors, if no candidate for one or more
directorships receives both such majorities, and any vacancies
remain to be filled, each person who receives the majority in
number of the Shareholders present in person or by proxy and
voting thereon shall be elected to fill such vacancies by
virtue of having received such majority.
The Company will determine whether Shareholders have acted in concert, depending
on the circumstances and the evidence, if any, that Shareholders were in fact so
acting and should therefore be treated as one shareholder. The Company may
require brokers, banks and other nominees holding shares for beneficial owners
to furnish information with respect to such beneficial owners for the purpose of
applying this provision. The proxy delivered with this proxy statement includes
a representation that the person signing the proxy is not acting in concert as
described above.
SHAREHOLDERS MAY OBTAIN WITHOUT CHARGE A COPY OF THE COMPANY'S MOST
RECENT ANNUAL REPORT ON FORM 10-K FILED WITH THE UNITED STATES SECURITIES AND
EXCHANGE COMMISSION UPON WRITTEN REQUEST TO COASTAL CARIBBEAN OILS & MINERALS,
LTD., C/O G&O'D INC, 149 DURHAM ROAD, OAK PARK - UNIT 31, MADISON, CONNECTICUT
06443.
PROPOSAL NO. 1
ELECTION OF DIRECTORS
Nominees
At the meeting, five directors are to be elected to hold office until
the Annual Meeting of Shareholders for the 1996 fiscal year and until their
successors have been duly elected and qualified. All nominees are currently
directors of the Company. The persons named in the accompanying proxy will vote
all properly executed proxies for the election of the persons named in the
following table unless authority to vote for one or more of the nominees is
withheld.
MANAGEMENT RECOMMENDS THAT SHAREHOLDERS VOTE FOR THE ELECTION OF THE NOMINEES.
Year First Age and Business Experience Other Offices Held With
Name Elected for the past Five Years* Company
Benjamin W. Heath 1962 Mr. Heath is Chairman and a director of Coastal President
Petroleum Company ("Coastal Petroleum"), the
Company's subsidiary, a director of Magellan
Petroleum Corporation ("MPC"), Chairman and a
director of Magellan Petroleum Australia Limited
("MPAL"), a majority owned subsidiary of MPC, and a
director of Canada Southern Petroleum Ltd. ("Canada
Southern"). Age eighty-one.
Phillip W. Ware 1985 Mr. Ware, a geologist, has been President of Coastal Vice President
Petroleum since April 1985. He is also a director
of Coastal Petroleum. Age forty-six.
Charles T. Collis 1987 Mr. Collis is a member of the law firm of Conyers, Secretary
Dill & Pearman, Hamilton, Bermuda, the Company's **
Bermuda counsel. Age sixty-three.
John D. Monroe 1981 Mr. Monroe is a real estate broker and was formerly **
President of Monroe-Buman RealEstate, Inc., a
real estate brokerage and development firm in Naples,
Florida. Age sixty-nine.
C. Dean Reasoner 1966 Mr. C. Dean Reasoner is a member of the law firm of
Reasoner, Davis & Fox, Washington, D.C. He is a
director of Coastal Petroleum, MPC, MPAL and Canada
Southern. See "Certain Business Relationships".
Age seventy-nine.
-------------------------
<FN>
* All of the named companies are engaged in oil, gas, or mineral
exploration and/or development except where noted. The business
experience described for each director above covers the past five
years.
** Member of Audit Committee.
</FN>
The Company is not aware of any arrangements or understandings between
any of the individuals named above and any other person pursuant to which any of
the individuals named above was selected as a director and/or executive officer.
The Company is not aware of any family relationship among the officers and
directors of the Company or its subsidiary.
Board of Directors; Committees; Attendance
The directors of the Company are elected to one-year terms at the
Annual Meeting of Shareholders of the Company. All officers of the Company are
elected annually and serve at the pleasure of the Board of Directors.
The principal functions of the Audit Committee are: (1) to recommend
the particular persons or firm to be employed by the Company as its independent
auditors; (2) to consult with the persons or firm so chosen to be the
independent auditors with regard to the plan of audit; (3) to review, in
consultation with the independent auditors, their report of audit, or proposed
report of audit, and the accompanying management letter, if any; and (4) to
consult with the independent auditors (periodically, as appropriate, out of the
presence of management) with regard to the adequacy of internal controls. During
1995, the Audit Committee, which was comprised of Messrs. Collis and Monroe, met
once.
The Company does not presently have standing nominating or compensation
committees of the Board of Directors. The functions that would be performed by
such committees are performed by the Board of Directors.
There were four meetings of the Board of Directors of the Company held
during 1995. None of the directors attended less than seventy-five percent of
the aggregate number of meetings of the Board of Directors and the Committees on
which they served.
ADDITIONAL INFORMATION CONCERNING DIRECTORS AND OFFICERS
Executive Compensation
The following table sets forth certain summary information concerning
the compensation of Mr. Benjamin W. Heath, President and Chief Executive Officer
of the Company. No other executive officers of the Company earned in excess of
$100,000 during fiscal year 1995.
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Summary Compensation Table
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Annual Compensation Long Term
Compensation All Other
Name and Award Compensation
Principal Position Year Salary ($) Options/SARs(#) ($) (2)
---------------------------------------- -------------------- --------------------- ------------------ ----------------------------
Benjamin W. Heath, President 1995 40,000 60,000 12,000
and Chief Executive Officer 1994 26,250 - 9,937
1993 25,000(1) - 6,750
---------------------------------------- -------------------- --------------------- ------------------ ----------------------------
<FN>
(1) Paid in February 1994.
(2) Reimbursement for office expense $6,000 in 1995, $6,000 in 1994 and
$3,000 in 1993. Payment to SEP-IRA pension plan $6,000 in 1995,
$3,937 for 1994 and $3,750 for 1993.
</FN>
Compensation of Directors
John D. Monroe received a director's fee of $15,000 for the year 1995.
On March 7, 1995, Directors Collis, Monroe and Ware were granted options to
purchase 50,000, 50,000 and 100,000 shares of the common stock of the Company,
respectively. The exercise price of the options is $1.35 per share, the market
price on the date of grant.
Compensation Committee Interlocks and Insider Participation
The entire board of directors is the compensation committee. Benjamin W.
Heath and Phillip W. Ware are directors and the Presidents, respectively, of
Coastal Caribbean and Coastal Petroleum. Mr. C. Dean Reasoner, a director, is a
partner in the law firm of Reasoner, Davis & Fox which was paid $118,000 for
legal services rendered in 1995.
Messrs. Heath and Reasoner also serve as directors of MPC, MPAL and Canada
Southern Petroleum Ltd. Mr. Heath is Chairman of MPAL. Reasoner, Davis & Fox
also renders services to MPC and Canada Southern Petroleum Ltd..
Compensation Committee Report on Executive Compensation
The Compensation Committee, consisting of the entire board of directors,
submits the following report for 1995:
The Board of Directors does not maintain specific compensation policies
applicable to the Company's executive officers, and the Board has established no
specific relationship between corporate performance and executive compensation.
Compensation has been determined based on the skills, experience and leadership
executive officers have brought to the performance of their duties, and on their
ability to protect, defend and pursue the Company's ability to realize value on
the Company's exploration leases.
Charles T. M. Collis
Benjamin W. Heath
John D. Monroe
C. Dean Reasoner
Phillip W. Ware
Tax Deductibility of Compensation
Because it is not likely that compensation to any executive will exceed
$1 million, and because the Company is a Bermuda corporation not subject to the
tax laws of the United States, the Company does not expect that it will be
required to comply with the Omnibus Reconciliation Act of 1993 regarding
executive compensation..
Stock Options
The following table provides additional information about the stock
options shown in the Summary Compensation Table set forth above that were
granted in 1995 to the Named Executive Officer.
===================================================================================================================================
Options/SAR Grants in Fiscal Year 1995
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Potential Realized Value at Assumed
Annual Rates of Stock
Individual Grants Price Appreciation for Option Term
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% of Total
Options/SARs
Options/ Granted to Exercise
SARs Granted Employees in or Base Expiration
Name (#) Fiscal Year Price ($/Sh) Date 5% ($) 10% ($)
========================== ============== ================== =============== ================= ==================== ===============
Benjamin W. Heath 60,000 19 1.35 Mar. 6, 2000 20,000 45,000
========================== ============== ================== =============== ================= ==================== ===============
The following table provides information about stock options exercised
during fiscal 1995.
===================================================================================================================================
Aggregated Option/SAR Exercises in 1995 and December 31, 1995 Option/SAR Values
===================================================================================================================================
Number of Unexercised Value of Unexercised
Shares Options/SARs In-The-Money
Acquired Value at December 31, 1995 Options/SARs
On Exercise (#) Realized ($) at December 31, 1995 ($)
-----------------------------------------------------------------------------------------------------------------------------------
Name Exercisable Unexercisable Exercisable Unexercisable
=========================== ==================== ================ ============== ================ ============== ============
Benjamin W. Heath -0- -0- 60,000 - - -
=========================== ==================== ================ ============== ================ ============== ============
PERFORMANCE GRAPH
The graph below compares the cumulative total returns, including
reinvestment of dividends, if applicable, of Company Stock with the companies in
the NASDAQ Index and an Industry Group Index (Media General's Oil, Natural Gas
Production Industry Group).
The chart displayed below is presented in accordance with SEC
requirements. Shareholders are cautioned against drawing any conclusions from
the data contained therein, as past results are not necessarily indicative of
future performance.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN
1990 1991 1992 1993 1994 1995
Coastal Caribbean 100 488.98 511.24 288.98 577.88 933.50
NASDAQ Stock Index 100 128.35 129.64 155.50 163.26 211.77
Industry Group 100 112.71 110.43 132.26 148.50 157.77
Certain Business Relationships
Reasoner, Davis & Fox
The Company has retained the services of the law firm of Reasoner,
Davis & Fox, of which Mr. C. Dean Reasoner, a director of the Company, is a
partner. Fees for legal services rendered to the Company by Reasoner, Davis &
Fox amounted to $118,000 for the year. In addition, Reasoner, Davis & Fox is
entitled to contingent fees payable in connection with Coastal Petroleum's
litigation against the State of Florida of 2.0 percent of any net recovery from
execution on or satisfaction of judgment or from settlement of this lawsuit.
G&O'D INC
During the year 1995, $176,809 was paid or accrued for accounting and
administrative services, office facilities and support staff provided to the
Company by G&O'D INC, a firm that is owned by Mr. James R. Joyce, Treasurer and
Assistant Secretary. The services rendered by G&O'D INC to the Company include
the following: preparation and filing of all reports required by Federal and
State governments, preparations of reports and registration statements required
under the Federal securities laws; preparation and filing of interim, special
and annual reports to shareholders; maintaining corporate ledgers and records;
furnishing office facilities and record retention. G&O'D is also responsible for
the investment of the Company's available funds and other banking relations and
securing adequate insurance to protect the Company. G&O'D is responsible for the
preparation and maintenance of all the minutes of any directors' and
shareholders' meetings, arranging all meetings of directors and shareholders,
coordinating the activities and services of all companies and firms rendering
services to the Company, responding to stockholder inquiries, and such other
services as may be requested by the Company. G&O'D maintains and provides
current information about the Company's activities so that the directors of the
Company may keep themselves informed as to the Company's activities. G&O'D's
fees are based on the time spent in performing these services to the Company.
Royalty Interests
The State of Florida oil, gas and mineral leases held by Coastal
Petroleum on approximately 3,700,000 acres of submerged lands along the Gulf
Coast and certain inland lakes and rivers are subject to certain overriding
royalties aggregating 1/16th as to oil, gas and sulphur, and 13/600ths as to
minerals other than oil, gas and sulphur. Of the overriding royalties as to oil,
gas and sulphur, a 1/90th overriding royalty, and of the overriding royalties on
minerals other than oil, gas and sulphur, a 1/60th overriding royalty, is held
by Johnson & Company, a Connecticut partnership which is used as a nominee by
the members of the family of the late William F. Buckley. A trust, in which Mr.
Heath has a 54.4 percent beneficial interest, and C. Dean Reasoner have
beneficial interests in such royalty interest held by Johnson & Company. No
payments have been made to Johnson & Company (or to the beneficial owners of
such royalty interests) in more than thirty years.
In 1990, Coastal Petroleum granted to officers 3.4% of any net recovery
from execution on or satisfaction of judgment or from settlement of the lawsuit
against the State of Florida as follows:
Relationship to
Percent of Coastal Petroleum
Name Net Recovery at Date of Grant
Benjamin W. Heath 1.25 Chairman of Board
Phillip W. Ware 1.25 President
Arthur B. O'Donnell 0.30 Vice President and Treasurer
James R. Joyce 0.30 Assistant Treasurer
James J. Gaughran 0.30 Secretary
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information as to the number of shares
of the Company's Stock owned beneficially, at April 15, 1996, by each person who
is known to be the beneficial owner of more than 5% of the outstanding shares of
common stock of the Company.
Name and address of Amount and nature
beneficial owner beneficial ownership Percent of class **
Shares held Shares subject
directly to option
Leon S. Gross 3,273,917 - 9.8
3900 Ford Road
Philadelphia, PA 19131
Lykes Minerals Corp. - 7,800,000* 18.9
111 East Madison Street
P.O. Box 1690
Tampa, FL 33601
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<FN>
* Under certain agreements with the Company, Lykes Minerals Corp.
("Lykes") has options to purchase shares of Coastal Petroleum, and to
exchange shares of Coastal Petroleum for shares of the Company. At
March 27, 1996, Lykes had purchased 66 shares of Coastal Petroleum with
options to purchase 12 additional shares or a total of 78 shares which
are convertible into 7,800,000 shares of the Company.
** Assumes all outstanding options are exercised to acquire shares of the Company.
</FN>
The following table sets forth information as to the number of shares
of the Company's common stock owned beneficially at April 15, 1996 by each
director of the Company and by all directors and executive officers as a group:
Amount and Nature of
Name of Beneficial Ownership
Individual Shares held Percent of
or Group directly Options (1) Class
----------------------- ---------- ------------ ------
Charles T. Collis 14,799 50,000 *
Benjamin W. Heath 40,000 60,000 *
John D. Monroe 400 50,000 *
C. Dean Reasoner 165,487 - *
Phillip W. Ware 2,611 100,000 *
Directors and executive officers
as a group (a total of 6 persons) 223,397 310,000 1.6%
---------------
<FN>
* Less than 1%.
(1) Options granted on March 7, 1995 at a price of $1.35 per share, the
market price on date of grant. The options are immediately exercisable and
expire on March 6, 2000.
</FN>
PROPOSAL NO. 2
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
The Board of Directors has appointed Ernst & Young LLP as the Company's
independent auditors for the year ending December 31, 1996. Representatives of
Ernst & Young LLP are not expected to be present at the meeting. The proxy
permits voting for or against, or abstaining from voting for, the ratification
of the appointment of auditors. Unless otherwise indicated, the shares will be
voted in favor of ratifying the appointment of Ernst & Young LLP.
MANAGEMENT RECOMMENDS A VOTE FOR PROPOSAL NO. 2.
OTHER MATTERS
The Board of Directors knows of no other matters that will be presented
for consideration at the meeting, other than those matters referred to in this
Proxy Statement.
Shareholder proposals relating to the Company's Annual General Meeting
of Shareholders for the fiscal year ending December 31, 1996 must be received by
the Company at its office, c/o Conyers, Dill & Pearman, Clarendon House,
Hamilton, Bermuda, by December 14, 1996. The fact that a shareholder proposal is
received in a timely manner does not insure its inclusion in the Company's proxy
materials. The Company reserves the right to omit any proposals from its Proxy
Statement and Form of Proxy where such omission is permitted by the rules of the
Securities and Exchange Commission.
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. THEREFORE,
SHAREHOLDERS WHO DO NOT EXPECT TO ATTEND THE MEETING IN PERSON ARE URGED TO
SIGN, DATE, AND RETURN THE ENCLOSED PROXY IN THE REPLY ENVELOPE PROVIDED.
By Order of the Board of Directors.
James R. Joyce
Assistant Secretary
Dated: May 17, 1996