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:
<Table>
[ ] 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 Rule 14a-12
</Table>
Tipperary 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] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) 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:
-----------------------------------------------------------------------
TIPPERARY CORPORATION
633 SEVENTEENTH STREET
SUITE 1550
DENVER, COLORADO 80202
================================================================================
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON
APRIL 23, 2002
TO THE SHAREHOLDERS:
Notice is hereby given that the Annual Meeting of Shareholders (the "Annual
Meeting") of Tipperary Corporation (the "Company"), a Texas corporation, will be
held in the Parisienne Room on the 3rd Floor of the Hyatt Regency, 1750 Welton
Street, Denver, Colorado, on Tuesday, April 23, 2002, at 10:00 a.m., MST, for
the purpose of taking action on:
1. The election of seven (7) directors to serve until the next Annual
Meeting of Shareholders or until their successors shall be duly elected
and qualified;
2. The ratification of the reappointment of PricewaterhouseCoopers LLP
("PricewaterhouseCoopers") as the Company's independent auditors;
3. The transaction of such other business as may properly come before the
Annual Meeting or any adjournment thereof.
The Company's Board of Directors has fixed the close of business on March 6,
2002, as the record date for the determination of shareholders entitled to
notice of and to vote at the Annual Meeting and any adjournment thereof. These
materials were first mailed to shareholders on or about April 2, 2002. The
principal executive office and mailing address of the Company is set forth
above.
Information concerning the matters to be acted upon at the Annual Meeting is set
forth in the accompanying Proxy Statement.
BY ORDER OF THE BOARD OF DIRECTORS
Elaine R. Treece
Corporate Secretary
Date: March 26, 2002
SHAREHOLDERS ARE CORDIALLY INVITED TO ATTEND THE MEETING IN PERSON. PLEASE
COMPLETE AND PROMPTLY RETURN YOUR SIGNED PROXY IN THE POSTAGE-PAID ENVELOPE. THE
PROXY IS REVOCABLE AT ANY TIME PRIOR TO ITS USE. IF YOU ATTEND THE MEETING YOU
CAN REVOKE YOUR PROXY AND VOTE IN PERSON.
PAGE 2 TIPPERARY CORPORATION
- --------------------------------------------------------------------------------
TIPPERARY CORPORATION
PROXY STATEMENT
SOLICITATION OF PROXY
The accompanying proxy is solicited on behalf of the Board of Directors of
Tipperary Corporation in connection with the Annual Meeting of Shareholders to
be held on Tuesday, April 23, 2002, ("Annual Meeting") in the Parisienne Room on
the 3rd Floor of the Hyatt Regency, 1750 Welton Street, Denver, Colorado, at
10:00 a.m., MST.
The cost of preparing, assembling and mailing the Notice of Annual Meeting of
Shareholders, Proxy Statement and form of proxy, which are first being mailed to
the shareholders on or about April 2, 2002, will be borne by the Company. It is
contemplated that solicitation of proxies will be primarily by mail, but may be
supplemented with personal solicitation by the Company's officers, directors and
other regular employees to whom no additional compensation will be paid.
REVOCATION OF PROXY
Any shareholder giving a proxy may revoke it at any time prior to its use by
notifying the Company either in person or by written notice of the revocation.
Each notice must specifically revoke the power to use and vote the proxy.
Shareholder attendance at the Annual Meeting may revoke any proxy given by such
shareholder. If no specification is made on the proxy, the shares will be voted
in accordance with the recommendation of the Board of Directors, as stated
herein, or at the discretion of the named proxy with regard to any other matter
that may properly come before the Annual Meeting.
VOTING AT THE ANNUAL MEETING
The close of business on March 6, 2002, has been fixed by the Company's Board of
Directors as the record date for the determination of shareholders entitled to
vote at the Annual Meeting. As of that date, the Company had issued and
outstanding 38,971,489 shares of Common Stock, par value $.02 per share.
The Company's Articles of Incorporation do not permit cumulative voting by
shareholders. The Common Stock is the Company's only class of voting securities.
Accordingly, each holder of Common Stock as of the record date will be entitled
to cast one vote for each share of Common Stock held by him or her.
A quorum for the Annual Meeting will consist of attendance, either in person or
by proxy, of a majority of outstanding shares of Common Stock. Of the votes cast
at the Annual Meeting, a vote of the holders of a majority of the Common Stock
present, either in person or by proxy, is required to elect each director
nominee and to ratify the reappointment of PricewaterhouseCoopers as the
Company's independent auditors.
PAGE 3 TIPPERARY CORPORATION
- --------------------------------------------------------------------------------
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table sets forth information as of March 6, 2002, regarding the
beneficial ownership of the voting securities of the Company by persons and
entities known by the Company to beneficially own more than 5% of the
outstanding Common Stock. Except as otherwise indicated, to the knowledge of the
Company, each person or entity whose name appears below has sole voting and
investment power over its respective shares of Common Stock.
<Table>
<Caption>
===============================================================================================================================
Name and Address of Amount and Nature of Percentage of Class
Beneficial Owner Beneficial Ownership
- ----------------------------------------------------------- ----------------------------------- -------------------------------
Slough Estates USA Inc. (1)
33 West Monroe Street 25,738,844(2) 63.3%
Chicago, Illinois 60603
- ----------------------------------------------------------- ----------------------------------- -------------------------------
Liberty Wanger Asset Management, L.P. (3) 1,996,712 5.1%
Suite 3000
227 West Monroe Street
Chicago, Illinois 60606
- ----------------------------------------------------------- ----------------------------------- -------------------------------
(1) Slough Estates USA Inc. ("Slough"), a Delaware corporation, is a wholly owned, U.S. subsidiary of Slough Trading Estate
Limited ("STEL"), which is a wholly owned subsidiary of Slough Estates plc ("SEL"). The board of directors of SEL
ultimately exercises voting and dispositive power with regard to the shares of the Company's Common Stock. SEL is a
publicly held limited liability company. The principal office of both SEL and STEL is located at 234 Bath Road, Slough
SL1 4EE, England.
- -------------------------------------------------------------------------------------------------------------------------------
(2) Includes 216,571 shares held as collateral for a loan due from the estate of a former director of the Company and
1,700,000 shares covered by warrants, of which 500,000 shares are covered by warrants expiring on December 21, 2005 and
exercisable at $3.00 per share and 1,200,000 shares are covered by warrants which expire December 23, 2009 and are
exercisable at $2.00 per share.
- -------------------------------------------------------------------------------------------------------------------------------
(3) This information is based on Schedule 13G/A filed with the United States Securities and Exchange Commission on February
13, 2002 by Liberty Wanger Asset Management, L.P. ("WAM"), WAM Acquisition GP, Inc., the general partner of WAM ("WAM GP")
and Liberty Acorn Trust ("Acorn"). WAM is an Investment Adviser registered under Section 203 of the Investment Advisers
Act of 1940; WAM GP is the General Partner of the Investment Adviser and Acorn is an Investment Company under Section 8 of
the Investment Company Act. All shares are included in the shares beneficially owned by WAM and WAM GP with shared voting
and dispositive power. Acorn claims beneficial ownership as to shared voting and dispositive power over 1,750,000 shares.
===============================================================================================================================
</Table>
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
In December 2001, the Company issued Slough 10,810,810 shares of the Company's
common stock for $20,000,000, or $1.85 per share, in connection with a
shareholder rights offering. The Company used $17,500,000 of the proceeds from
the rights offering to repay Slough all of the loans advanced for general
corporate purposes. The remaining proceeds from the rights offering are being
used for general corporate purposes.
Related party debt due Slough at December 31, 2001, included a note payable with
a balance due of $2,425,000. The loans under this note were provided to the
Company for the purchase of a drilling rig to be used in Australia. The rig has
been leased to a drilling contractor in Queensland, Australia. Interest is due
at a rate of 10% per annum. Principal payments are due monthly equal to the
rents received from the lessee of the drilling rig. The unpaid principal balance
on the loan, together with accrued and unpaid interest, is due and payable July
31, 2003.
PAGE 4 TIPPERARY CORPORATION
- --------------------------------------------------------------------------------
SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth information as of March 6, 2002, regarding shares
of the Company's Common Stock beneficially owned by each nominee for director,
each executive officer and executive officers and directors as a group. Except
as otherwise indicated, to the knowledge of the Company, each person has sole
voting and investment power over his or her respective shares of Common Stock.
===============================================================================================================================
Name of Beneficial Amount and Nature of
Title of Class Owner Beneficial Ownership Percentage of Class(1)
- -------------------------------------------------------------------------------------------------------------------------------
Common Stock David L. Bradshaw 578,362 (2) 1.5%
Kenneth L. Ancell 207,492 (3) *
Eugene I. Davis 65,000 (4) *
Douglas Kramer 40,000 *
Marshall D. Lees 25,000 (5) *
Charles T. Maxwell 93,334 (6) *
D. Leroy Sample 21,245 (7) *
Jeff T. Obourn 255,815 (8) *
Lisa S. Wilson 81,138 (9) *
Larry G. Sugano 63,782 (10) *
Roger C. Wiggin 47,962 (11) *
Executive officers and 1,479,130 3.7
directors as a group, 11 in
*less than 1% number
- -------------------------------------------------------------------------------------------------------------------------------
(1) Securities not outstanding, but included in the beneficial ownership of each such person are deemed to be outstanding for
the purpose of computing the percentage of outstanding securities owned by such person, but are not deemed to be
outstanding for the purpose of computing the percentage of the class owned by any other person.
- -------------------------------------------------------------------------------------------------------------------------------
(2) Includes 540,234 shares issuable pursuant to options and warrants which are currently exercisable or exercisable within 60
days of March 6, 2002.
- -------------------------------------------------------------------------------------------------------------------------------
(3) Includes 198,334 shares issuable pursuant to warrants which are currently exercisable or exercisable within 60 days of
March 6, 2002.
- -------------------------------------------------------------------------------------------------------------------------------
(4) Represents 65,000 shares issuable pursuant to warrants which are currently exercisable or exercisable within 60 days of
March 6, 2002.
- -------------------------------------------------------------------------------------------------------------------------------
(5) Represents 25,000 shares issuable pursuant to a warrant which is currently exercisable or exercisable within 60 days of
March 6, 2002.
- -------------------------------------------------------------------------------------------------------------------------------
(6) Includes 33,334 shares issuable pursuant to a warrant which is currently exercisable or exercisable within 60 days of
March 6, 2002.
- -------------------------------------------------------------------------------------------------------------------------------
(7) Includes 16,667 shares issuable pursuant to a warrant which is currently exercisable or exercisable within 60 days of
March 6, 2002.
- -------------------------------------------------------------------------------------------------------------------------------
(8) Includes 175,001 shares issuable pursuant to a warrant and options which are currently exercisable or exercisable within
60 days of March 6, 2002.
- -------------------------------------------------------------------------------------------------------------------------------
(9) Includes 69,734 shares issuable pursuant to options which are currently exercisable or exercisable within 60 days of
March 6, 2002.
- -------------------------------------------------------------------------------------------------------------------------------
(10) Includes 60,000 shares issuable pursuant to options which are currently exercisable or exercisable within 60 days of
March 6, 2002.
- -------------------------------------------------------------------------------------------------------------------------------
(11) Includes 30,000 shares issuable pursuant to options which are currently exercisable or exercisable within 60 days of
March 6, 2002.
===============================================================================================================================
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
Based solely upon a review of Forms 3 and 4 and amendments thereto furnished to
us under Rule 16a-3(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act") during the fiscal year ended December 31, 2001 and Forms 5 and
amendments thereto furnished to us with respect to the fiscal year ended
December 31, 2001, as well as any written representation from a reporting person
that no Form 5 is required, the Company is not aware of any person that failed
to file on a timely basis, as disclosed in the aforementioned Forms, reports
required by Section 16(a) of the Exchange Act during the fiscal year ended
December 31, 2001, other than Mr. Sample, who failed to timely file a Form 4
reporting an acquisition of common stock through the rights offering, and
Slough, which to the Company's knowledge has failed to file any reports on
transactions and holdings under Section 16(a) of the Exchange Act. Mr. Sample
has subsequently filed the form with the
PAGE 5 TIPPERARY CORPORATION
- --------------------------------------------------------------------------------
Securities and Exchange Commission and to the Company's knowledge, Slough has
not conducted any transactions that would subject Slough to potential penalties
under Section 16, commonly called "matching provisions."
COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors was aided by four standing committees during 2001. The
Audit Committee assesses the Company's system of internal control and assists in
considering the recommendations and performance of the Company's independent
auditors; the Compensation Committee evaluates the performance and compensation
of the Company's officers and employees; the Nominating Committee is responsible
for consideration of nominations to the Board of Directors from shareholders of
the Company; and the Executive Committee performs certain duties and
responsibilities as delegated by the Board concerning the day-to-day operations
of corporate business. Messrs. Davis (Chairman), Maxwell and Sample serve on the
Audit Committee. The Nominating Committee is composed of Messrs. Bradshaw and
Lees. Messrs. Kramer, Lees and Davis serve on the Compensation Committee and all
Board members serve on the Executive Committee.
AUDIT COMMITTEE REPORT
The Audit Committee consists of three directors, each of whom meet the
independence requirements of the American Stock Exchange ("AMEX"): Eugene I.
Davis, who serves as Chairman, Charles T. Maxwell and D. Leroy Sample. This
committee assists the Board of Directors in fulfilling its responsibility for
oversight of the quality and integrity of the accounting, auditing and financial
reporting practices of the Company. The Board of Directors has approved a
charter adopted by the Audit Committee, a copy of which was included as an
exhibit to last year's proxy statement. The Audit Committee met four times
during 2001 to review the Company's financial reporting process and to approve
the quarterly and annual financial statements.
The Audit Committee has discussed with the independent auditors the matters
required to be discussed by Statement on Auditing Standards No. 61, which
includes, among other items, matters related to the audit of the Company's
financial statements.
The Audit Committee has obtained from the independent auditors a formal written
statement describing any relationships between the auditors and the Company that
might bear on the auditors' independence as required by Independence Standards
Board Standard No. 1, "Independence Discussions with Audit Committees," and
satisfied itself as to the auditors' independence.
Based on the review and discussions referred to above, the Audit Committee has
recommended to the Board of Directors that the Company's audited financial
statements be included in its Annual Report on Form 10-KSB for the year ended
December 31, 2001 for filing with the Securities and Exchange Commission. The
Audit Committee has also approved the reappointment of PricewaterhouseCoopers
LLP as the Company's independent auditors.
Eugene I. Davis, Chairman
Charles T. Maxwell
D. Leroy Sample
DIRECTORS MEETINGS AND ATTENDANCE
During the fiscal year ended December 31, 2001, there were three meetings of the
Company's Board of Directors. All directors attended at least 75% of the
meetings.
COMPENSATION OF DIRECTORS
Directors who are officers or employees of the Company are not compensated for
serving as directors or for attending meetings. During the fiscal year ended
December 31, 2001, the Company compensated its nonemployee, outside directors at
the rate of $8,000 annually and $1,000 for each board meeting attended.
Directors are not compensated for attendance at Board committee meetings.
PAGE 6 TIPPERARY CORPORATION
- --------------------------------------------------------------------------------
EXECUTIVE COMPENSATION
The table below presents the compensation awarded to, earned by, or paid to the
Company's President and Chief Executive Officer, its Executive Vice President -
Corporate Development, its Senior Vice President , its Chief Financial Officer
and Vice President - Engineering for the calendar years ended December 31, 2001
and 2000 and the fiscal year ended September 30, 1999. No other executive
officer of the Company received total annual salary and bonus for each year in
excess of $100,000.
<Table>
<Caption>
===============================================================================================================================
SUMMARY COMPENSATION TABLE
- -------------------------------------------------------------------------------------------------------------------------------
Long-Term
Annual Compensation Compensation
----------------------------------------- -----------------
Awards
-----------------
Securities
Underlying
Other Annual Options & All Other
Fiscal Compen- Warrants Compen-
Name and Principal Position Year Salary Bonus sation(1) /SARs(2) sation(3)
- ---------------------------------- ------------ ----------- ----------- ----------------- ----------------- -----------------
Calendar
David L. Bradshaw, 2001 $218,077 $ -- -- -- $4,558
------------ ----------- ----------- ----------------- ----------------- -----------------
Calendar
President & Chief 2000 $218,077 $50,000 -- 100,000 $5,250
Executive Officer
------------ ----------- ----------- ----------------- ----------------- -----------------
Fiscal
1999 $181,731 $ -- -- 50,000 $1,503
------------ ----------- ----------- ----------------- ----------------- -----------------
Calendar
Kenneth L. Ancell 2001 $192,115 $ -- -- -- $1,751
------------ ----------- ----------- ----------------- ----------------- -----------------
Executive Vice President - Calendar
Corporate Development 2000 $185,000 $40,000 -- -- $ --
------------ ----------- ----------- ----------------- ----------------- -----------------
Calendar
Jeff T. Obourn 2001 $144,808 $15,000 -- 50,000 $3,394
------------ ----------- ----------- ----------------- ----------------- -----------------
Sr. Vice President Calendar
2000 $129,808 $15,000 -- -- $3,079
------------ ----------- ----------- ----------------- ----------------- -----------------
Fiscal
1999 $124,615 $25,000 -- 40,000 $1,348
------------ ----------- ----------- ----------------- ----------------- -----------------
Calendar
Lisa S. Wilson 2001 $112,538 $ -- -- -- $2,149
------------ ----------- ----------- ----------------- ----------------- -----------------
Calendar
Chief Financial Officer 2000 $107,865 $15,000 -- 10,000 $2,457
------------ ----------- ----------- ----------------- ----------------- -----------------
Fiscal
1999 $103,077 $10,000 -- 30,000 $1,062
------------ ----------- ----------- ----------------- ----------------- -----------------
Calendar
Larry G. Sugano 2001 $103,462 $10,000 -- 15,000 $2,102
Vice President - Engineering
===============================================================================================================================
</Table>
(1) In addition to amounts listed, the Company furnished other various
benefits, the value of which are not reported in this column because the
Company has concluded that the aggregate amount of these benefits is less
than 10% of cash compensation paid.
(2) No SARs were granted to any of the named officers during the last three
years.
(3) Represents the Company's matching contribution to the Section 401(k)
Retirement Savings Plan.
PAGE 7 TIPPERARY CORPORATION
- --------------------------------------------------------------------------------
The following table sets forth certain information with respect to stock
warrants and options granted to the named executive officers during the fiscal
year ended December 31, 2001:
<Table>
<Caption>
============================================================================================================================
WARRANT AND OPTION/SAR GRANTS IN LAST FISCAL YEAR
- ----------------------------------------------------------------------------------------------------------------------------
INDIVIDUAL GRANTS
- ----------------------------------------------------------------------------------------------------------------------------
NUMBER OF PERCENT OF TOTAL
SECURITIES WARRANT/OPTIONS
UNDERLYING GRANTED TO EXERCISE OR
WARRANTS/OPTIONS EMPLOYEES IN BASE PRICE
NAME GRANTED FISCAL YEAR ($/SHARE) EXPIRATION DATE
- ----------------------- --------------------- -------------------- --------------- -----------------------------------------
Jeff T. Obourn 50,000 66% $3.75 2 years after termination of employment
- ----------------------- --------------------- -------------------- --------------- -----------------------------------------
Larry G. Sugano 15,000 20% $3.75 January 30, 2011
============================================================================================================================
</Table>
The following table sets forth information with respect to stock warrants and
option exercises during the fiscal year ended December 31, 2001, by the named
executive officers and the value of such officer's unexercised stock options and
warrants at December 31, 2001.
<Table>
<Caption>
============================================================================================================================
AGGREGATED WARRANTS AND OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END WARRANTS AND OPTION/SAR VALUES
- ----------------------------------------------------------------------------------------------------------------------------
VALUE OF UNEXERCISED IN-
SHARES NUMBER OF UNEXERCISED WARRANTS THE-MONEY WARRANTS AND
ACQUIRED ON VALUE REALIZED AND OPTIONS/SARS HELD AT FISCAL OPTIONS/SARS
NAME EXERCISE YEAR END AT FISCAL YEAR END
- ---------------------- --------------- --------------- ---------------------------------- ----------------------------------
Exercisable Unexercisable Exercisable Unexercisable
- ---------------------- --------------- --------------- ----------------- ---------------- ----------------- ----------------
David L. Bradshaw -- -- 540,234 16,666 $16,000 $2,000
- ---------------------- --------------- --------------- ----------------- ---------------- ----------------- ----------------
Kenneth L. Ancell -- -- 198,334 66,666 $16,000 $8,000
- ---------------------- --------------- --------------- ----------------- ---------------- ----------------- ----------------
Jeff T. Obourn -- -- 158,334 56,666 $1,600 $800
- ---------------------- --------------- --------------- ----------------- ---------------- ----------------- ----------------
Lisa S. Wilson -- -- 69,734 11,666 $1,200 $600
- ---------------------- --------------- --------------- ----------------- ---------------- ----------------- ----------------
Larry G. Sugano -- -- 55,000 15,000 $ -- $ --
============================================================================================================================
</Table>
EMPLOYMENT AGREEMENTS
On September 18, 2001, the Company entered into a two-year employment agreement
with David L. Bradshaw for the position of Chairman, President and Chief
Executive Officer, providing for, among other things, minimum compensation at
the rate of $210,000 per year. In addition, Mr. Bradshaw may receive bonuses at
time and in amounts to be determined by the Company's Compensation Committee
based upon corporate and individual performance. The agreement will renew
automatically for additional two-year periods unless terminated under the terms
of the agreement. The employment agreement provides that in the event Mr.
Bradshaw's employment is terminated by the Company without cause, other than as
a result of death or disability, Mr. Bradshaw will be entitled to any unpaid
compensation and bonus, if any, accrued through the date of termination, which
shall be one year after notice is given, plus compensation which accrues for one
year following the termination date.
PAGE 8 TIPPERARY CORPORATION
- --------------------------------------------------------------------------------
On October 17, 1999, the Company entered into a three-year employment agreement
with Kenneth L. Ancell for the position of Executive Vice President - Corporate
Development, providing for, among other things, minimum compensation at the rate
of $185,000 per year. In addition, Mr. Ancell may receive a performance bonus
equal to 20-25% of his basic compensation if he and the Company achieve such
performance goals as may reasonably be set in the discretion of management of
the Company. The employment agreement provides that in the event Mr. Ancell's
employment is terminated by the Company without cause, other than as a result of
death or disability, Mr. Ancell will be entitled to any unpaid compensation and
bonus, if any, accrued through the date of termination, which requires 15 days
notice, plus compensation which accrues for six months following the end of the
employment term.
On January 17, 2002, the Company entered into a three-year employment agreement
with Jeffrey T. Obourn for the position of Senior Vice President, providing for,
among other things, minimum compensation at the rate of $150,000 per year. In
addition, Mr. Obourn may receive bonuses at times and in amounts to be
determined by the Company's Compensation Committee and upon approval of the
Board of Directors based upon corporate and individual performance. The
employment agreement provides that in the event Mr. Obourn's employment is
terminated by the Company without cause, other than as a result of death or
disability, Mr. Obourn will be entitled to any unpaid compensation and bonus, if
any, accrued through the date of termination, which shall be one year after
notice is given, plus compensation which accrues for one year following the
termination date.
PROPOSAL I
ELECTION OF DIRECTORS
The Company's By-Laws authorize the Board of Directors to be comprised of not
less than three nor more than 15 members. The Company's Board of Directors has
presently determined that the Board shall be comprised of seven members, but
reserves the right to increase the number of directors if the need arises. The
seven nominees listed below have been recommended by the Nominating Committee
and approved by the full Board of Directors. Upon election, they shall
constitute at that date the Company's entire Board of Directors.
It is intended that the enclosed proxy will be voted FOR the election of the
seven nominees named below to the Company's Board of Directors, unless authority
to so vote is withheld on the proxy. In the event any nominee is unable to serve
as a director for any reason not currently known or contemplated, the person
named as Proxy will have discretionary authority in that instance to vote the
proxy for any substitute nominee that the Board of Directors may designate. Each
nominee elected to serve as director will hold office until the next Annual
Meeting or until his successor is elected and qualified.
The following sets forth information as of March 6, 2002, with respect to each
nominee for director:
David L. Bradshaw, 47, has been a director of the Company since January 23,
1990, and became President and Chief Executive Officer of the Company on January
16, 1996. Mr. Bradshaw, a certified public accountant, began his employment with
the Company in January 1986, and has held various positions with the Company,
including Chief Financial Officer and Chief Operating Officer, prior to his
current position. Prior to joining the Company, Mr. Bradshaw was an officer and
owner in a privately held oil and gas company.
Kenneth L. Ancell, 59, was elected to the Board of Directors on July 11, 1996,
and became Executive Vice President - Corporate Development of the Company on
October 17, 1999. For 17 years before joining the Company as an employee, Mr.
Ancell was a petroleum engineer and a principal in a Houston-based consulting
engineering firm. Prior to forming this consulting firm, Mr. Ancell was employed
as a petroleum engineer by various energy companies developing coalbed methane
projects. He has served as a senior project advisor for the United Nations
coalbed methane project in China, and was a Distinguished Lecturer on coalbed
methane reserves for the Society of Petroleum Engineers. Mr. Ancell has
expertise in oil and gas recovery processes and more than 20 years of coalbed
methane experience.
Eugene I. Davis, 47, was elected to the Board of Directors on September 2, 1992,
and had served as independent legal counsel to the Company from 1984 until 1992.
In 1999, he became Chairman and Chief Executive Officer of PIRINATE Consulting
Group, L.L.C., a privately held consulting firm specializing in crisis and
turn-around management, merger and acquisition consulting, hostile and friendly
takeovers, proxy contests and strategic planning advisory services for public
and private business entities. Mr. Davis has been Chairman, Chief Executive
Officer and President of RBX Industries, Inc. since August 2001, after having
been appointed Chief Restructuring Officer in January 2001. RBX is a leading
manufacturer of closed cell foam and custom mixed rubber compounds. From January
2000 through August 2001, Mr. Davis was Chairman and Chief Executive Officer of
Murdock Communications Corp., a NASDAQ listed company. In November 1999, Mr.
Davis became a director of PhoneTel
PAGE 9 TIPPERARY CORPORATION
- --------------------------------------------------------------------------------
Technologies, Inc., a NASDAQ listed company. From May 1999 through June 2001, he
was the Chief Executive Officer of SmarTalk Teleservices, Inc., which had filed
a petition under Chapter 11 of the Federal Bankruptcy Code in March 1999. He was
Chief Operating Officer of TotalTel USA Communications, Inc. in 1998. Both
SmarTalk Teleservices, Inc. and TotalTel USA Communications, Inc. are NASDAQ
listed companies. In addition, he is a director of Anchor Glass Container Corp.,
Coho Energy, Inc., Elder-Beerman Stores Corp., Eagle Geophysical, Inc., and a
member of the Board of Advisors of PPM America Special Investment Funds.
Douglas Kramer, 65, was elected to the Board of Directors on August 19, 1996.
Mr. Kramer is Chairman and Director of Draper and Kramer, Inc., a real estate
and mortgage banking company headquartered in Chicago. He is also Director of
Slough Estates plc, a London, England-based property company that beneficially
owned approximately 63.3% of the Company's Common Stock as of March 6, 2002. He
is also Chairman and Director of Slough Estates USA Inc., a wholly-owned
subsidiary of Slough Estates plc.
Marshall D. Lees, 48, was elected to the Board of Directors on September 30,
1995. In 1987 Mr. Lees joined Slough Estates plc, a London, England-based
property company that beneficially owned approximately 63.3% of the Company's
Common Stock as of March 6, 2002. He is the Chief Executive Officer of Slough
Estates North America, which includes Slough Estates USA Inc., and Slough
Estates Canada Limited. He became an Executive Director of Slough Estates plc in
1998. He is also a Director of Charterhouse Group International, Inc.
Charles T. Maxwell, 70, has been a director of the Company since May 2000. Mr.
Maxwell is senior energy analyst with Weeden & Co., Greenwich, Connecticut, a
member firm of the New York Stock Exchange, serving institutional clients in the
U.S. and abroad. He has also been a director of Lescarden, Inc. (OTC: LCAR), a
biotechnology company, since April 1, 1997. Mr. Maxwell was formerly vice
chairman and senior energy strategist at Cyrus J. Lawrence, Inc., then a member
firm of the New York Stock Exchange, for 29 years, until his retirement in 1997.
D. Leroy Sample, 60, was elected to the Board of Directors on November 30, 2000.
Mr. Sample was a business assurance partner in the international accounting firm
of PricewaterhouseCoopers LLP in Chicago for 24 years until he retired in July
1999. He began his career with the firm in 1963. Mr. Sample is a certified
public accountant.
EXECUTIVE OFFICERS
In addition to Messrs. Bradshaw and Ancell shown above, the following sets forth
information with respect to the remainder of the Company's executive officers:
Jeff T. Obourn, 44, has been a Senior Vice President of the Company since
January 16, 1996. He became employed as the Company's Vice President - Land on
February 1, 1993. From 1987 to 1993, Mr. Obourn was President of Obourn
Brothers, Inc., of Englewood, Colorado, an oil and gas land brokerage business.
Lisa S. Wilson, 43, has been Chief Financial Officer of the Company since March
1, 1998. Ms. Wilson joined the Company as tax manager in 1991. From 1985 to
1990, Ms. Wilson, a certified public accountant, was employed in public
accounting, most recently as tax manager in the Dallas, Texas, office of Price
Waterhouse.
Larry G. Sugano, 49, has held the position of Vice President - Engineering since
January 24, 1995. Mr. Sugano joined the Company October 10, 1994 as Engineering
Manager and was employed by Graham Royalty, Ltd., Denver, Colorado from 1984 to
1993.
Roger C. Wiggin, 42, became employed as the Company's Vice President -
Exploration and Development on April 1, 1997. His title was recently changed to
Vice President - Geology. From 1983 until joining the Company in 1997, Mr.
Wiggin was employed by Mitchell Energy and Development Corporation, The
Woodlands, Texas, as a geologist. Prior experience also includes a position with
Chevron, USA, in Denver.
There are no family relationships between or among the executive officers and
nominees to the Board of Directors of the Company. There are no arrangements or
understandings between any of the directors or nominees or any other person
pursuant to which any person was or is to be elected as a director or nominee.
PAGE 10 TIPPERARY CORPORATION
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PROPOSAL 2
APPOINTMENT OF INDEPENDENT AUDITORS
The Board of Directors, subject to ratification by the shareholders at the
Annual Meeting, has reappointed PricewaterhouseCoopers LLP as the Company's
independent auditor. PricewaterhouseCoopers has been the Company's independent
accounting firm since 1998. Price Waterhouse LLP served as the Company's
independent auditor from 1971 through 1997. The Company has been advised that
neither PricewaterhouseCoopers nor any member thereof has any direct financial
interest or any material indirect interest in the Company.
During 2001, we paid the following fees to PricewaterhouseCoopers LLP:
<Table>
Audit Fees $ 97,123
Other fees
Audit-related fees(1) 95,000
Tax consulting 6,020
Other consulting 24,923
----------
Total $ 223,066
==========
</Table>
(1) Audit-related fees were for services rendered in connection with
registration statements and consents.
SHAREHOLDERS ARE REQUESTED TO VOTE FOR THE RATIFICATION OF THE REAPPOINTMENT OF
PRICEWATERHOUSECOOPERS AS THE COMPANY'S INDEPENDENT AUDITORS.
Representatives of PricewaterhouseCoopers are expected to be present at the
Annual Meeting and will be afforded an opportunity to make a statement, if they
desire to do so. It is expected that such representatives will be available to
respond to appropriate shareholder questions.
ANNUAL REPORT
An Annual Report containing the Company's certified Consolidated Financial
Statements as of December 31, 2001, accompanies this Proxy Statement. The
following items from the Annual Report are incorporated herein by reference: (i)
the audited consolidated balance sheets of the Company as of December 31, 2001
and 2000 and September 30, 2000; audited statements of operations, cash flows
and stockholders equity for the year ended December 31, 2001, the three-month
transition period ended December 31, 2000 and the fiscal years ended September
30, 2000 and 1999, and Notes to the Consolidated Financial Statements; and (ii)
Management's Discussion and Analysis of Financial Condition and Results of
Operations. No other part of the Annual Report is or shall be deemed to be
incorporated by reference into this Proxy Statement. No other part of such
Annual Report is incorporated herein by reference and no part thereof is to be
considered proxy soliciting material.
FORM 10-KSB
SHAREHOLDERS MAY OBTAIN, WITHOUT CHARGE, THE COMPANY'S ANNUAL REPORT ON FORM
10-KSB FOR THE YEAR ENDED DECEMBER 31, 2001, AS FILED WITH THE SECURITIES AND
EXCHANGE COMMISSION BY WRITING TO THE SECRETARY OF THE COMPANY AT 633
SEVENTEENTH STREET, SUITE 1550, DENVER, COLORADO 80202, OR THROUGH A LINK ON THE
COMPANY'S WEBSITE AT WWW.TIPPERARYCORP.COM.
SHAREHOLDER PROPOSALS
Shareholders desiring to submit proposals for action at the Company's 2003
Annual Meeting of Shareholders, including nominations for the Board of Directors
to be considered by the Company's Nominating Committee, must submit such
proposals to the Company at its principal offices not later than February 15,
2003.
PAGE 11 TIPPERARY CORPORATION
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DISCRETIONARY AUTHORITY
The Company's Board of Directors does not know of any other business to be
presented at the Annual Meeting. If any other matter properly comes before the
Annual Meeting, however, it is intended that the person named in the enclosed
proxy will vote said proxy in accordance with his best judgment.
BY ORDER OF THE BOARD OF DIRECTORS
Elaine R. Treece
Corporate Secretary
Date: March 26, 2002
TIPPERARY CORPORATION
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD APRIL 23, 2002
The undersigned hereby (a) acknowledges receipt of the Notice of Annual
Meeting of Shareholders ("Notice") of Tipperary Corporation ("the Company") to
be held on April 23, 2002, and the Proxy Statement in connection therewith, each
dated March 26, 2002, (b) appoints David L. Bradshaw, with the power to act
alone or to appoint his substitute, as attorney and proxy to represent and vote,
as designated below, all the shares of Common Stock, par value $0.02 per share,
of the Company held of record by the undersigned on March 6, 2002, at such
Annual Meeting and at any adjournment(s) thereof; and (c) revokes any proxy
heretofore given.
1. The election of seven (7) directors to serve until the next Annual
Meeting of Shareholders or until their successors shall be duly elected
and qualified
Nominees: David L. Bradshaw, Kenneth L. Ancell, Eugene I. Davis, Douglas
Kramer, Marshall D. Lees, Charles T. Maxwell and D. Leroy Sample.
<Table>
[ ] FOR all nominees, except those [ ] WITHHOLD AUTHORITY
whose name(s) is (are) written to vote for all nominees.
below.
</Table>
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2. The ratification of the reappointment of PricewaterhouseCoopers as the
Company's independent auditors;
[ ] FOR [ ] AGAINST [ ] ABSTAIN
- --------------------------------------------------------------------------------
3. In his discretion, the Proxy is authorized to vote upon such other
business as may properly come before the Annual Meeting or any
adjournment(s) thereof.
(Continued, and to be signed, on page 2)
(Continued from other side)
THIS PROXY WILL BE VOTED AS SPECIFIED. IF NO SPECIFICATION IS INDICATED,
THIS PROXY WILL BE VOTED FOR THE ELECTION TO THE BOARD OF DIRECTORS OF THE
NOMINEES LISTED ON THIS PROXY, FOR PROPOSAL NO. 2, AND IN THE DISCRETION OF THE
PROXY ON ANY OTHER BUSINESS.
If your shares are registered in the name of a brokerage firm or bank, only
your bank or broker can vote your stock and only after receiving your specific
instruction.
This proxy revokes all prior proxies.
<Table>
Dated: , 2002
---------------------------
--------------------------------------------
Signature(s):
--------------------------------------------
Important: please date this proxy and sign
exactly as your name appears to the left.
When signing as attorney, administrator,
trustee or guardian, please give your full
title as such. When stock is in the name of
more than one person, each such person
should sign the proxy.
</Table>