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SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF
1934
Filed by the Registrant (X)
Filed by a Party other than the Registrant ( )
Check the appropriate box:
( ) Preliminary Proxy Statement
( ) Definitive Proxy Statement
(X) Definitive Additional Materials
( ) Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
PRESIDIO OIL COMPANY
(Name of Registrant as Specified in Its Charter)
PRESIDIO OIL COMPANY
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
( ) $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2).
( ) $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:*
________________________________________________________________________
4. Proposed maximum aggregate value of transaction:
________________________________________________________________________
* Set forth the amount on which the filing fee is calculated and state how
it was determined.
(X) 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:
$125
2. Form Schedule or Registration Statement No.:
Preliminary Proxy Statement
3. Filing Party:
Presidio Oil Company
4. Date Filed:
April 13, 1994
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(Logo)
PRESIDIO OIL COMPANY
5613 DTC PARKWAY, SUITE 750
P.O. BOX 6525
ENGLEWOOD, COLORADO 80155-6525
(303) 773-0100
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD JUNE 14, 1994
Dear Stockholder:
On behalf of the Board of Directors and Management, you are cordially
invited to attend the 1994 Annual Meeting of Stockholders of Presidio Oil
Company, a Delaware corporation (the "Company"), to be held in the Board Room of
The Chase Manhattan Bank Executive Conference Facility located on the Fifth
Floor at 410 Park Avenue, between 54th and 55th Streets, New York City, New York
on Tuesday, June 14, 1994, at 9:00 A.M., Eastern Time, for the following
purposes:
- To elect three directors;
- To act upon a proposal to adopt a 1993 Stock Option Plan for
Non-Employee Directors; and
- To consider such other matters as may properly come before such
meeting or any adjournment(s) thereof.
The Board of Directors has fixed the close of business on April 18, 1994 as
the record date for determining stockholders entitled to notice of and to vote
at the meeting. Only stockholders of record at the close of business on that
date are entitled to notice of and to vote at the meeting and any adjournment(s)
thereof.
Your vote is important regardless of the number of shares you may own. The
Company urges you to date, sign and promptly return your proxy so that your
shares may be voted in accordance with your wishes and in order that the
presence of a quorum may be assured. The prompt return of your signed proxy will
aid the Company in reducing the expense of additional proxy solicitation. The
giving of such proxy does not affect your right to vote in person in the event
you attend the meeting.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ BRUCE R. DEBOER
BRUCE R. DEBOER
Corporate Secretary
April 28, 1994
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PRESIDIO OIL COMPANY
5613 DTC PARKWAY, SUITE 750
P.O. BOX 6525
ENGLEWOOD, COLORADO 80155-6525
(303) 773-0100
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
JUNE 14, 1994
PROXY SOLICITATION
This statement is furnished in connection with the solicitation by the
Board of Directors of Presidio Oil Company, a Delaware corporation (the
"Company"), of proxies to be voted at the Company's Annual Meeting of
Stockholders to be held on June 14, 1994, or at any adjournment or postponement
thereof (the "Annual Meeting"). This Proxy Statement and form of proxy included
herewith are dated April 28, 1994, and are being sent to stockholders on or
about May 6, 1994.
If the enclosed proxy is properly executed and returned, the shares
represented by the proxy will be voted at the Annual Meeting. If a stockholder
indicates in his proxy a choice with respect to any matter to be acted upon, the
shares will be voted in accordance with such choice. If no choice is indicated,
the shares will be voted "FOR" the proposal and the director nominees set forth
on the enclosed proxy. A stockholder giving a proxy may revoke it by giving
written notice of revocation to the Corporate Secretary of the Company at any
time before it is voted, by executing another valid proxy bearing a later date
and delivering such proxy to the Corporate Secretary of the Company prior to or
at the Annual Meeting, or by attending the Annual Meeting and voting in person.
PERSONS MAKING THE SOLICITATION
This proxy is solicited on behalf of the Board of Directors of the Company
(the "Board of Directors"). The initial solicitation will be by mail. The total
expense of such solicitation will be borne by the Company and will include
reimbursement paid to brokerage firms and others for their expenses in
forwarding solicitation material regarding the Annual Meeting to beneficial
owners of the Company's stock. Further solicitation of proxies may be made by
mail, telephone or oral communication with some stockholders of the Company
following the original solicitation. All such further solicitation will be made
by the Board of Directors or consultants currently retained by the Company or
employees of the Company, who will not be additionally compensated therefor, or
by the Company's transfer agent in which case the cost will be borne by the
Company.
STOCKHOLDERS ENTITLED TO VOTE
Stockholders of record at the close of business on April 18, 1994 (the
"Record Date") will be entitled to vote at the Annual Meeting. As of April 18,
1994, there were issued and outstanding 25,316,685 shares of the Company's Class
A Common Stock, $.10 par value per share (the "Class A Common Stock"), and
3,217,985 shares of the Company's Class B Common Stock, $.10 par value per share
(the "Class B Common Stock"). On all matters on which the Class A Common Stock
and Class B Common Stock are entitled to vote together as one class, each holder
of Class A Common Stock is entitled to one-twentieth ( 1/20) of one vote for
each share held and each holder of Class B Common Stock is entitled to one (1)
vote for each share held. Cumulative voting is not allowed. The Company's Bylaws
provide that the holders of stock representing a majority of the voting power of
all classes of stock issued and outstanding and voting together at any
stockholders' meeting, in person or represented by proxy, shall constitute a
quorum at such meeting.
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Abstentions and broker non-votes are counted for purposes of determining the
presence or absence of a quorum for the transaction of business. Abstentions are
counted in tabulations of the votes cast on proposals presented to stockholders,
whereas broker non-votes are not counted for purposes of determining whether a
proposal has been approved.
ELECTION OF DIRECTORS
THE BOARD OF DIRECTORS
Pursuant to the Bylaws of the Company, the Board of Directors shall consist
of the number of directors designated by resolution of the Board of Directors.
Currently, the number of directors is fixed at eleven (11). The directors are
classified and divided as evenly as possible among three (3) classes and the
terms of such classes are staggered so that only one (1) class is elected each
year for a three-year term, or until a successor to each such director is duly
elected and qualified. The term of the Class C Directors will expire at the
Annual Meeting and this proxy solicits your vote for three (3) Class C
Directors. The Class A Directors' term will expire at the annual meeting of
stockholders to be held in 1995, and the Class B Directors' term will expire at
the annual meeting of stockholders to be held in 1996.
PRESENT DIRECTORS NOMINATED FOR RE-ELECTION
The nominees listed below, each of whom is currently a director of the
Company, have consented to being nominated and to serve if elected. The Board of
Directors recommends voting "FOR" the election of the following nominees for the
Board of Directors:
DIRECTOR TERM TO
NAME AGE SINCE EXPIRE
- ----------------------- --- -------- -------
George P. Giard, Jr. 55 1986 1994
Peter H. Havens 39 1983 1994
Robert L. Smith 51 1992 1994
CONTINUING DIRECTORS WHOSE TERMS ARE NOT EXPIRING
DIRECTOR TERM TO
NAME AGE SINCE EXPIRE
- ----------------------- --- -------- -------
William D. Benjes, Jr. 55 1987 1995
H. S. Erskine 73 1985 1996
Vincent Farrell, Jr. 47 1989 1995
John W. Hyland, Jr. 56 1993 1996
Raymond J. Kosi 58 1984 1996
J. Howard Marshall, II 89 1987 1996
Hugh A. L. Mumford 48 1986 1995
Peter Silvester 58 1987 1995
Additional information concerning the three (3) nominees for election as
directors and the continuing directors of the Company is as follows:
NOMINEES
George P. Giard, Jr. is Chairman of the Board and Chief Executive Officer
of the Company. Mr. Giard joined the Company in 1986 after being a partner since
1981 in Oil & Gas Finance Limited, a private energy investment firm. He also
served as a director of Marline Oil Corporation from 1976 through 1985 and
Chairman of the Board of that company from 1976 through 1983. He has also served
as a director of Crystal Oil Company since 1987.
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Peter H. Havens has been manager since 1982 of Kewanee Enterprises, an
investment firm. Mr. Havens has been a director of Bryn Mawr Trust Company since
March 1986 and is also a director of Nobel Education Dynamics, Inc.
Robert L. Smith has been a director of the Company since 1992 when he was
elected President and Chief Operating Officer of the Company. Mr. Smith was
previously Executive Vice President of the Company since 1987, and prior to
joining the Company and for over five years, he served in various capacities,
including President and Chief Operating Officer, with Cenergy Corporation, an
oil and gas exploration and production company.
CONTINUING DIRECTORS
William D. Benjes, Jr. is the founder of Stratfield Investment Management,
Inc. and has been its President since 1986. Mr. Benjes was with Fort Hill
Investors Management Group from 1977 through 1985 and served as its President
from 1982 through 1985.
H. S. Erskine is an oil and gas consultant. From 1981 through 1986, Mr.
Erskine was President and Chief Operating Officer of Cenergy Corporation. Mr.
Erskine has also served in an executive capacity with Gulf Oil Exploration and
Production Company.
Vincent Farrell, Jr. has been a partner in Spears Benzak Salomon & Farrell
since 1982 and currently serves as a director of Garnet Resources Corp. and
Forschner Group, Inc. Mr. Farrell was previously with a predecessor of Smith
Barney Shearson Inc. for several years.
John W. Hyland, Jr. has been a partner of McFarland Dewey & Co. since 1992
and previously served as a managing director of Rho Management Company, Inc.
from 1989 to 1992. He was a managing director of PaineWebber Incorporated and
Vice Chairman of PaineWebber/Young and Rubicam Ventures from 1983 to 1988, Vice
Chairman of Warburg Paribas Becker Inc. from 1980 to 1983, and prior thereto a
partner in Morgan Stanley & Co. Inc. Mr. Hyland is also a director of Summit
Communications Group, Inc.
Raymond J. Kosi is a private investor and business consultant. Mr. Kosi was
the co-founder and an officer from 1963 through 1993 of K.R.K. Inc., a
privately-owned manufacturer of plastic injection moldings.
J. Howard Marshall, II was Chairman of the Board of Petroleum Development
Corporation from its incorporation in 1984 until its acquisition by the Company
in 1987. Mr. Marshall is Chairman of Marshall Petroleum, Inc., and has been an
independent oil and gas operator for the last twenty years. Previously, Mr.
Marshall has served as Special Counsel, Chevron Corporation; Partner, Pillsbury,
Madison and Sutro; President, Ashland Oil Company; Executive Vice President,
Signal Oil Company; President, Union Texas Petroleum Corporation; and Executive
Vice President, Allied Chemical Company. He currently serves as a Director of
Koch Industries, Inc. and Coastal Oil & Gas Corporation.
Hugh A. L. Mumford currently serves as managing director of Electra
Investment Trust P.L.C. ("Electra"). Mr. Mumford has been an officer of Electra
since 1981 and a director since 1985. Mr. Mumford, a citizen of the United
Kingdom, is also a director of Mezzanine Capital Corporation, an investment
company, and New London Oil P.L.C.
Peter Silvester is Executive Director and General Manager (Investments) of
Friends' Provident Life Office ("Friends") and Executive Director of a number of
its subsidiaries. Mr. Silvester, a citizen of the United Kingdom, has been an
executive with Friends for more than the last five years. He is a Fellow of the
Institute of Actuaries and a Fellow of the Pensions Management Institute, where
he was on the Council for six years and Vice President from 1983 to 1985. Mr.
Silvester is also a director of Esprit Gestion S.A. and Mapral Limited.
OTHER INFORMATION ABOUT THE BOARD OF DIRECTORS
The Board of Directors has an Executive Committee that has and may exercise
all the power and authority of the Board of Directors, allowed by law to be
delegated, in the management of the business and
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affairs of the Company while the Board of Directors is not in session. The
current members are William D. Benjes, Jr., H. S. Erskine, George P. Giard, Jr.,
Peter H. Havens, Raymond J. Kosi and Robert L. Smith.
The Board of Directors has an Audit Committee that selects an accounting
firm to conduct an annual audit of the Company's consolidated financial
statements and reviews with such firm the plan, scope and results of such audit
and the fees for the services performed. The Audit Committee also reviews with
the independent auditors the adequacy of internal control systems and reports
its findings to the full Board of Directors. The Audit Committee is composed of
directors who are not salaried employees of the Company. Peter H. Havens and
Raymond J. Kosi are the current members.
The Board of Directors has a Compensation Committee that reviews and
determines salaries of officers, reviews and establishes Company policy with
respect to compensation of all employees and determines benefit grants under
certain benefit plans, including the Employee Stock Ownership Plan, Incentive
Stock Option Plan, Executive Bonus Program and Director Stock Option Plans. The
current members of the Compensation Committee are William D. Benjes, Jr.,
Vincent Farrell, Jr. and J. Howard Marshall, II.
The Board of Directors has a Nominating Committee to identify and recommend
candidates for the Board of Directors. The current members of the Nominating
Committee are George P. Giard, Jr., Peter H. Havens and Raymond J. Kosi. The
Nominating Committee does not consider nominees recommended by security holders
other than members of the Nominating Committee.
During the twelve month period ended December 31, 1993, the Board of
Directors met five (5) times; the Executive Committee met nine (9) times; the
Compensation Committee met three (3) times; the Audit Committee met five (5)
times; and the Nominating Committee met one (1) time. No incumbent director
other than Mr. Mumford and Mr. Silvester attended or participated in fewer than
seventy-five percent (75%) of the aggregate of all meetings of the Board of
Directors and any committee on which such director served.
OTHER EXECUTIVE OFFICERS
The following is a list of executive officers and managers of the Company,
other than Mr. Giard and Mr. Smith, each of whose term of office runs until a
successor is duly appointed:
Christopher S. Hardesty, age 49, joined the Company in 1992 as Vice
President-Finance, Treasurer and Chief Financial Officer. Mr. Hardesty was
previously Executive Vice President, Treasurer and Chief Financial Officer of
DeKalb Energy Company and for over five years, served in various capacities with
Newmont Mining Corporation, Newmont Gold Company and Exxon Corporation.
Kendell V. Tholstrom, age 48, currently serves as Vice President and
General Manager, Rocky Mountain and Mid-Continent Regions of the Company. Mr.
Tholstrom joined the Company in 1986 as Operations Manager and subsequently
served as Vice President of Operations and Vice President and General Manager,
Rocky Mountain Division. He has eighteen years of prior reservoir engineering
and operations experience with Sabine Corporation and Terra Resources, Inc.
Bruce R. DeBoer, age 41, joined the Company as General Counsel and
Corporate Secretary in 1988. He was previously Corporate Attorney and Assistant
Secretary for Canterra Petroleum, Inc. and General Counsel and Secretary of
Energetics, Inc. Prior thereto, Mr. DeBoer was engaged in the private practice
of law in Denver, Colorado.
ADOPTION OF 1993 STOCK OPTION PLAN FOR NON-EMPLOYEE DIRECTORS
On January 11, 1994, the Executive Committee of the Board of Directors
approved a resolution to adopt, subject to stockholder approval, a 1993 Stock
Option Plan for Non-Employee Directors (the "1993 DSOP").
Under the 1993 DSOP, effective as of December 28, 1993, each of the nine
(9) current non-employee directors of the Company were granted options to
purchase up to 25,000 shares of Class A Common Stock. The aggregate number of
shares of Class A Common Stock covered by the 1993 DSOP is 225,000. The exercise
price for such options is $1.8125 per share, which was the closing price for the
Class A Common
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Stock on the American Stock Exchange on December 28, 1993, the date when the
1993 DSOP was approved by the Compensation Committee of the Board of Directors.
Options granted under the 1993 DSOP vest in twenty-five percent (25%)
increments after each full year of service as a director. Except in certain
circumstances, including merger or consolidation with another corporation or the
sale of substantially all of the Company's assets, no such option will be
exercisable as to any shares as to which the continuous service requirement has
not been satisfied.
The 1993 DSOP is construed, interpreted and administered by the
Compensation Committee. The Compensation Committee, however, has no discretion
to determine who will receive options, the number of shares subject to such
options or any other principal terms of the options, including the exercise
price and the periods within which the options may be exercised. The principal
terms of the option grants are fixed in the 1993 DSOP.
The 1993 DSOP terminates whenever the Board of Directors adopts a
resolution to that effect or ten (10) years after stockholder approval thereof.
No amendment, modification, suspension or termination of the 1993 DSOP may be
taken without the approval of the stockholders where such action would
materially increase the number of shares that may be issued, materially alter
the class of recipients eligible to receive such options or materially increase
the benefits accruing to the participants under the 1993 DSOP.
NEW PLAN BENEFITS
1993 DSOP
NAME AND POSITION NO. OF SHARES
-------------------------------------------------- -------------
George P. Giard, Jr. -0-
Chairman and CEO
Robert L. Smith -0-
President
Christopher S. Hardesty -0-
Vice President and CFO
Kendell V. Tholstrom -0-
Vice President
Bruce R. DeBoer -0-
General Counsel and Secretary
Executive Group -0-
Non-Executive Director Group 225,000
Non-Executive Officer Employee Group -0-
The management of the Company and the Board of Directors believe it is in
the best interests of the Company to compensate its non-employee directors for
their continued service to the Company, and that the granting of options to the
non-employee directors of the Company, subject to the terms and conditions of
the 1993 DSOP, will enable the Company to attract and retain the valuable
services of individuals of outstanding quality and ability and will allow such
non-employee directors to participate in the growth of the Company. See Appendix
A hereto for a more detailed description of the 1993 DSOP.
The approval and adoption of this proposal requires the affirmative vote of
the holders of record at the close of business on the Record Date of a majority
of the voting power of the Class A Common Stock and Class B Common Stock present
in person or by proxy at the Annual Meeting and voting together as one class,
with holders of Class A Common Stock entitled to one-twentieth ( 1/20) of one
vote for each share held and holders of Class B Common Stock entitled to one (1)
vote for each share held. The shares represented by the
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proxies solicited by the Board of Directors will be voted as directed on the
form of proxy or, if no direction is indicated, will be voted "FOR" the approval
of this proposal.
The Board of Directors recommends voting "FOR" this proposal.
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
Class A Common Stock. The following table shows, as of April 18, 1994, the
beneficial ownership (shares owned or that may be acquired within sixty (60)
days) of Class A Common Stock by (a) each person known by the Company to be the
beneficial owner of more than five percent (5%) of the outstanding Class A
Common Stock, (b) each current director and executive officer and (c) all of the
Company's current executive officers and directors as a group. Each share of
Class B Common Stock is convertible at any time at the option of the holder into
one (1) share of Class A Common Stock. The right to acquire Class A Common Stock
in this manner is reflected in the following table which assumes conversion of
all beneficially owned shares of Class B Common Stock set forth in the Class B
Common Stock table which follows the Class A Common Stock table below.
NUMBER OF COMBINED
SHARES
BENEFICIALLY PERCENT
NAME OF BENEFICIAL OWNER OWNED(1) OF CLASS
------------------------------- ------------------ --------
(a) Five percent (5%) holders:
FMR Corp. 3,894,608(1) 13.5%
82 Devonshire Street
Boston, Massachusetts 02109
Spears Benzak Salomon & Farrell 2,456,924(2) 8.5%
45 Rockefeller Plaza
New York, New York 10111
Friends' Provident Life Office 2,364,962(3) 8.3%
15 Old Bailey
London EC4M 7AP United Kingdom
Franklin Resources, Inc. 1,727,079(4) 5.7%
777 Mariners Island Boulevard
San Mateo, California 94404
Employee Stock Ownership Plan 1,621,034(5) 5.7%
of
Presidio Oil Company
c/o Presidio Oil Company
5613 DTC Parkway, Suite 750
Englewood, Colorado 80111
Electra Investment Trust P.L.C. 1,449,733 5.1%
65 Kingsway
London WC2B 6QT United Kingdom
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NUMBER OF COMBINED
SHARES
BENEFICIALLY PERCENT
NAME OF BENEFICIAL OWNER OWNED(1) OF CLASS
------------------------------- ------------------ --------
(b) Directors and Executive
Officers:
Vincent Farrell, Jr. 2,544,637(6) 8.8%
Peter Silvester 2,384,066(7) 8.4%
George P. Giard, Jr. 2,236,067(8) 7.7%
Robert L. Smith 1,803,195(9) 6.3%
Hugh A. L. Mumford 1,468,837(10) 5.1%
J. Howard Marshall, II 644,860(11) 2.3%
Peter H. Havens 135,678(12) *
Raymond J. Kosi 90,517(13) *
Kendell V. Tholstrom 84,913(14) *
William D. Benjes, Jr. 72,854(15) *
H. S. Erskine 45,003(16) *
Bruce R. DeBoer 42,938(17) *
Christopher S. Hardesty 21,250(18) *
John W. Hyland, Jr. -0-(19) -0-
(c) All directors and executive 9,953,781(20) 33.3%
officers
as a group (14 persons):
- ---------------
* Does not exceed one percent (1%) of the class.
(1) Fidelity Management and Research Company ("FMRC "), a wholly-owned
subsidiary of FMR Corp. ("FMR"), and a registered investment advisor,
beneficially owns 1,231,558 shares of Class A Common Stock upon conversion
of the Company's 9% Convertible Subordinated Debentures Due 2015
("Debentures"), as a result of acting as an investment advisor to several
registered investment companies ("Funds"). FMR through its control of FMRC,
has sole investment power with respect to the Debentures and voting power
over the underlying shares resides with each respective Fund's Board of
Trustees. Fidelity International Limited ("FIL") which may be deeded to be
an affiliate of FMR that provides investment advisory and management
services to a number of non-United States investment companies and certain
institutional investors, beneficially owns 2,663,050 shares of Class A
Common Stock as to which it has sole investment and voting power. According
to Schedules 13D dated March 30, 1994, filed by both FMR and FIL, Edward C.
Johnson III, Chairman of FIL, and Chief Executive Officer of FMR, may be
deemed to share investment power over the shares beneficially owned by FMR
and FIL.
(2) All such shares, including 279,850 shares of Class A Common Stock issuable
upon conversion of Debentures, are beneficially owned by third parties for
whom Spears Benzak Salomon & Farrell may share investment power.
(3) Includes 1,507,143 shares of Class A Common Stock beneficially owned by UKP
Holdings Inc., a subsidiary of Friends. Also includes 115,000 shares of
Class B Common Stock beneficially owned by Friends.
(4) Pursuant to a Schedule 13G dated February 11, 1993, filed by Franklin
Custodian Funds -- Income Series ("FCF ") and Franklin Resources, Inc.
("FRI ") on behalf of FRI, all such shares of Class A Common Stock are
issuable upon conversion of Debentures. FRI is an investment company and
advisor, as well as the subsidiary of FCF, which in the aggregate,
beneficially own the shares. FRI and FCF have shared investment power with
respect to the shares and disclaim the aggregation of such shares for
purposes of Rule 13(d)3 promulgated under the Securities Exchange Act of
1934.
(5) Includes 467,871 shares of Class B Common Stock.
(6) Mr. Farrell, as a partner in Spears Benzak Salomon & Farrell, may also be
deemed to be the beneficial owner of 2,456,924 shares listed in the table
above as being beneficially owned by Spears Benzak Salomon & Farrell due to
shared investment power which he may exercise over third party accounts.
Such number includes 12,713 shares of Class B Common Stock that may be
acquired upon the exercise of options granted under the Stock Option Plan
for Non-Employee Directors, the 1989 Stock Option
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Plan for Non-Employee Directors, the 1991 Stock Option Plan for
Non-Employee Directors and the 1992 Stock Option Plan for Non-Employee
Directors (collectively, the "DSOPs"), but does not include 25,000 unvested
shares of Class A Common Stock granted under the 1993 DSOP and 15,000
unvested shares of Class B Common Stock granted under the DSOPs.
(7) Mr. Silvester, as an officer of Friends, may be deemed to be the beneficial
owner of 2,249,462 shares of Class A Common Stock and 115,500 shares of
Class B Common Stock listed in the table above as being beneficially owned
by Friends. Such number includes 19,104 shares of Class B Common Stock that
may be acquired upon the exercise of options granted under the DSOPs, but
does not include 25,000 unvested shares of Class A Common Stock granted
under the 1993 DSOP and 7,500 unvested shares of Class B Common Stock
granted under the DSOPs.
(8) Includes 19,359 shares of Class B Common Stock. Also includes 11,030 shares
of Class A Common Stock and 157,209 shares of Class B Common Stock that may
be acquired pursuant to the exercise of warrants held in the name of Oil
and Gas Finance Limited, an entity over which Mr. Giard exercises voting
control; 11,000 shares of Class A Common Stock and 313,539 shares of Class
B Common Stock that may be acquired upon the exercise of options and 35,730
shares of Class A Common Stock and 15,220 shares of Class B Common Stock
held in trust in Mr. Giard's individual account under the Company's
Employee Stock Ownership Plan ("ESOP "), all of which are vested. Includes
1,153,163 shares of Class A Common Stock and 467,871 shares of Class B
Common Stock held by the ESOP which have not been allocated to
participating employees' accounts. Mr. Giard acts as a co-trustee of the
ESOP and may be deemed to share voting or dispositive power with respect to
such unallocated shares; however, Mr. Giard disclaims beneficial ownership
of any of such unallocated shares. Does not include 235,000 unvested shares
of Class A Common Stock and 100,000 unvested shares of Class B Common Stock
granted pursuant to options.
(9) Includes 4,621 shares of Class B Common Stock, 105,622 shares of Class B
Common Stock that may be acquired upon the exercise of options and 30,811
shares of Class B Common Stock pursuant to the exercise of a warrant. Also
includes 28,218 shares of Class A Common Stock and 9,745 shares of Class B
Common Stock held in trust in Mr. Smith's individual account under the
ESOP, all of which are vested. Includes 1,153,163 shares of Class A Common
Stock and 467,871 shares of Class B Common Stock held by the ESOP which
have not been allocated to participating employees' accounts. Mr. Smith
acts as a co-trustee of the ESOP and may be deemed to share voting or
dispositive power with respect to such unallocated shares; however, Mr.
Smith disclaims beneficial ownership of any of such unallocated shares.
Does not include 125,000 unvested shares of Class A Common Stock and 52,000
unvested shares of Class B Common Stock granted pursuant to options.
(10) Mr. Mumford, as an officer of Electra, may be deemed to be the beneficial
owner of 1,449,733 shares of Class A Common Stock beneficially owned by
Electra. Such number includes 19,104 shares of Class B Common Stock that
may be acquired upon the exercise of options granted under the DSOPs, but
does not include 25,000 unvested shares of Class A Common Stock granted
under the 1993 DSOP and 7,500 unvested shares of Class B Common Stock
granted under the DSOPs.
(11) Includes 7,258 shares of Class A Common Stock held in the name of Marshall
Associates, a general partnership, of which Mr. Marshall is a general
partner and 67,465 shares of Class A Common Stock held in the name of
Marshall Petroleum, Inc., of which Mr. Marshall is Chairman. Such number
includes 19,104 shares of Class B Common Stock that may be acquired upon
the exercise of options granted under the DSOPs, but does not include
25,000 unvested shares of Class A Common Stock granted under the 1993 DSOP
and 7,500 unvested shares of Class B Common Stock granted under the DSOPs.
(12) Includes 45,000 shares of Class A Common Stock and 40,000 shares of Class B
Common Stock held in a grantor retained income trust in respect of which
Mr. Havens' spouse is a co-trustee and co-beneficiary. Mr. Havens is the
trust's investment advisor. Also includes 500 shares of Class A Common
Stock and 5,000 shares of Class B Common Stock held in the name of Mr.
Havens' spouse and 600 shares of Class A Common Stock and 6,000 shares of
Class B Common Stock in a trust over which Mr. Havens shares voting and
investment power. Includes 38,578 shares of Class B Common Stock that
8
11
may be acquired upon the exercise of options granted under the DSOPs, but
does not include 25,000 unvested shares of Class A Common Stock granted
under the 1993 DSOP and 15,000 unvested shares of Class B Common Stock
granted under the DSOPs.
(13) Includes 51,939 shares of Class B Common Stock and 38,578 shares of Class B
Common Stock that may be acquired upon the exercise of options granted
under the DSOPs. Such number does not include 25,000 unvested shares of
Class A Common Stock granted under the 1993 DSOP and 15,000 unvested shares
of Class B Common Stock granted under the DSOPs.
(14) Includes 500 shares of Class A Common Stock and 46,839 shares of Class B
Common Stock that may be acquired upon the exercise of options and 24,878
shares of Class A Common Stock and 10,546 shares of Class B Common Stock
held in the trust under the ESOP, all of which are vested. Does not include
50,000 unvested shares of Class A Common Stock and 21,435 unvested shares
of Class B Common Stock granted pursuant to options.
(15) Includes 23,750 shares of Class A Common Stock held in accounts over which
Mr. Benjes shares investment power. Such number also includes 19,104 shares
of Class B Common Stock that may be acquired pursuant to the exercise of
options under the DSOPs, but does not include 25,000 unvested shares of
Class A Common Stock granted under the 1993 DSOP and 7,500 unvested shares
of Class B Common Stock granted under the DSOPs.
(16) Includes 1,100 shares held in the name of Mr. Erskine's spouse. Also
includes 38,578 shares which may be acquired pursuant to the exercise of
options under the DSOPs. Does not include 25,000 unvested shares of Class A
Common Stock granted under the 1993 DSOP and 15,000 unvested shares of
Class B Common Stock granted under the DSOPs.
(17) Includes 12,361 shares of Class A Common Stock and 5,580 shares of Class B
Common Stock held in trust under the ESOP, all of which are vested. Also
includes 18,997 shares of Class B Common Stock which may be acquired
pursuant to the exercise of options. Does not include 40,000 unvested
shares of Class A Common Stock and 14,461 shares of Class B Common Stock
granted pursuant to options.
(18) Includes 15,000 shares that may be acquired by Mr. Hardesty pursuant to the
exercise of a warrant. On January 15, 1993, the Company entered into an
agreement with Mr. Hardesty whereby he purchased for $2,250 a warrant to
acquire 15,000 shares at an exercise price of $1.0625 per share, the market
price on the date of the warrant. Also includes 6,250 shares that may be
acquired upon the exercise of options. Does not include 73,750 unvested
shares granted pursuant to options.
(19) Does not include 25,000 unvested shares of Class A Common Stock granted
under the 1993 DSOP.
(20) Includes an aggregate of 101,187 shares of Class A Common Stock and 41,091
shares of Class B Common Stock held in trust under the ESOP for officers of
the Company as well as the unallocated ESOP shares described above in
footnotes 8 and 9 as beneficially owned by both Mr. Giard and Mr. Smith, as
ESOP co-trustees; 17,750 shares of Class A Common Stock and 484,997 shares
of Class B Common Stock which may be acquired by officers of the Company
upon the exercise of options; 279,850 shares issuable upon conversion of
Debentures held or controlled by a director of the Company; 26,030 shares
of Class A Common Stock and 188,020 shares of Class B Common Stock that may
be acquired by an executive officer, or an entity over which Mr. Giard
exercises voting control, pursuant to the exercise of certain warrants; and
204,863 shares of Class B Common Stock which may be acquired by directors
of the Company upon exercise of options granted under the DSOPs.
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Class B Common Stock. The following table shows, as of April 18, 1994, the
beneficial ownership (shares owned or that may be acquired within sixty (60)
days) of Class B Common Stock by (a) each person known by the Company to be the
beneficial owner of more than five percent (5%) of the outstanding Class B
Common Stock, (b) each current director and executive officer and (c) all of the
Company's current executive officers and directors as a group.
NUMBER
OF SHARES
BENEFICIALLY PERCENT
NAME OF BENEFICIAL OWNER OWNED OF CLASS
--------------------------------------- ------------ --------
(a) Five percent (5%) holders:
Mary L. Smith 1,085,019 33.7%
Kewanee Enterprises
101 Bryn Mawr Avenue, Suite 200
Bryn Mawr, Pennsylvania 19010
Employee Stock Ownership Plan of 467,871 14.5%
Presidio Oil Company
c/o Presidio Oil Company
5613 DTC Parkway, Suite 750
Englewood, Colorado 80111
Philip S. Sirianni 264,129(1) 8.1%
23041 Avenida de la Carlota, Suite 210
Laguna Hills, California 92653
(b) Directors and Executive Officers:
George P. Giard, Jr. 973,198(2) 26.4%
Robert L. Smith 618,670(3) 18.4%
Peter Silvester 134,604(4) 4.2%
Raymond J. Kosi 90,517(5) 2.8%
Peter H. Havens 89,578(6) 2.8%
Kendell V. Tholstrom 57,385(7) 1.8%
H. S. Erskine 38,578(8) 1.2%
Bruce R. DeBoer 24,577(9) *
William D. Benjes, Jr. 19,104(10) *
J. Howard Marshall, II 19,104(10) *
Hugh A. L. Mumford 19,104(10) *
Vincent Farrell, Jr. 12,713(11) *
Christopher S. Hardesty -0- -0-
John W. Hyland, Jr. -0- -0-
(c) All directors and executive officers 1,629,261(12) 36.7%
as a group (14 persons):
- ---------------
* Does not exceed one percent (1%) of the class.
(1) Includes 41,659 shares issuable upon the exercise of stock options granted
in 1987, 1988, 1989 and 1993 in consideration of the provision of advisory
services to the Company, all of which are vested.
(2) Includes 157,209 shares that may be acquired pursuant to the exercise of
warrants held in the name of Oil and Gas Finance Limited, an entity over
which Mr. Giard exercises voting control, 313,539 shares that may be
acquired upon the exercise of options; and 15,220 shares held in trust
under the ESOP, all of which are vested. Also includes 467,871 shares of
Class B Common Stock held by the ESOP which have not been allocated to
participating employees' accounts. Mr. Giard acts as a co-trustee of the
ESOP and may be deemed to share voting or dispositive power with respect to
such unallocated shares; however, Mr. Giard disclaims beneficial ownership
of any of such unallocated shares. Does not include 100,000 unvested shares
granted pursuant to options.
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(3) Includes 30,811 shares that may be acquired by Mr. Smith pursuant to the
exercise of a warrant; 105,622 shares that may be acquired upon the
exercise of options; and 9,745 shares held in trust under the ESOP, all of
which are vested. Also includes 467,871 shares of Class B Common Stock held
by the ESOP which have not been allocated to participating employees'
accounts. Mr. Smith acts as a co-trustee of the ESOP and may be deemed to
share voting or dispositive power with respect to such unallocated shares;
however, Mr. Smith disclaims beneficial ownership of any of such
unallocated shares. Does not include 52,000 unvested shares granted
pursuant to options.
(4) Includes 115,500 shares held by Friends over which Mr. Silvester may have
investment power and 19,104 shares issuable upon the exercise of options
granted under the DSOPs, all of which are vested. Does not include 7,500
unvested shares granted under the DSOPs.
(5) Includes 38,578 shares issuable upon the exercise of options granted under
the DSOPs, but does not include 15,000 unvested shares granted under the
DSOPs.
(6) Includes 38,578 shares issuable upon the exercise of options granted under
the DSOPs, 6,000 shares in a trust over which Mr. Havens shares voting and
investment power, 5,000 shares held in the name of Mr. Havens' spouse and
40,000 shares held in a grantor retained income trust in respect of which
Mr. Havens' spouse is a co-trustee and co-beneficiary and Mr. Havens is the
investment advisor. Does not include 15,000 unvested shares granted under
the DSOPs.
(7) Includes 46,839 shares issuable upon the exercise of options and 10,546
shares held in trust under the ESOP, all of which are vested, but does not
include 21,435 unvested shares granted pursuant to options.
(8) All of such shares are issuable upon the exercise of options granted under
the DSOPs. Does not include 15,000 unvested shares granted pursuant to the
DSOPs.
(9) Includes 18,997 shares issuable upon the exercise of options and 5,580
shares held in trust under the ESOP, all of which are vested. Does not
include 14,461 unvested shares granted pursuant to options.
(10) All of such shares are issuable upon the exercise of options granted under
the DSOPs. Does not include 7,500 unvested shares granted pursuant to the
DSOPs.
(11) All of such shares are issuable upon the exercise of options granted under
the DSOPs. Does not include 15,000 unvested shares granted pursuant to the
DSOPs.
(12) Includes an aggregate 741,171 shares which may be acquired by officers and
directors of the Company upon the exercise of options. Also includes
188,020 shares that may be acquired by executive officers, or an entity
over which Mr. Giard exercises voting control, pursuant to the exercise of
certain warrants, 41,091 shares held in trust under the ESOP for executive
officers of the Company and the unallocated ESOP shares described above in
footnotes 2 and 3 as beneficially owned by Mr. Giard and Mr. Smith, as ESOP
co-trustees, all of which are vested.
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EXECUTIVE COMPENSATION AND OTHER INFORMATION
SUMMARY OF CASH AND CERTAIN OTHER COMPENSATION
The following table sets forth compensation paid by the Company to its
Chief Executive Officer and four other most highly compensated executive
officers for fiscal years 1993, 1992 and 1991.
SUMMARY COMPENSATION TABLE
LONG TERM
ANNUAL COMPENSATION(1) COMPENSATION
---------------------- ------------
OPTIONS ALL OTHER
NAME AND SALARY($) AWARDED COMPENSATION
PRINCIPAL POSITION YEAR (2) BONUS($) (#)(3) ($)(4)
- ------------------------------------- ---- --------- -------- ------------ ------------
George P. Giard, Jr. 1993 332,596 100,000 235,000 165,138(5)
Chairman and CEO 1992 396,635 30,300 139,039 30,000
1991 396,635 140,000 100,000 30,000
Robert L Smith 1993 228,307 50,000 125,000 90,155(6)
President and COO 1992 203,625 19,000 51,622 30,000
1991 210,749 48,500 52,000 30,000
Christopher S. Hardesty 1993 150,000 38,000 55,000 -0-
Vice President and 1992 6,827(7) -0- 25,000 -0-
CFO 1991
Kendell V. Tholstrom 1993 128,125 45,000 50,000 27,469
Vice President 1992 126,322 10,000 22,524 19,808
1991 126,562 12,500 19,000 20,000
Bruce R. DeBoer 1993 102,083 31,500 40,000 21,058
General Counsel and 1992 111,923 6,800 10,958 17,519
Secretary 1991 101,538 8,000 13,000 15,700
- ---------------
(1) The Company provides group insurance benefits for its executive officers
which are generally available to all salaried employees, including medical
and dental insurance, term life insurance, and long-term disability
insurance. In addition, executive officers of the Company are provided
certain club memberships for business purposes. A certain amount of
personal use of these benefits may be made by the recipients. After
reasonable inquiry, the Company has concluded that the aggregate amount of
such personal benefits, which cannot be specifically or precisely
ascertained, was less than either $50,000 or ten percent (10%) of the
salary and bonus reported for each of the named executive officers.
(2) In 1991, Messrs. Giard, Smith, Tholstrom and DeBoer received $12,500,
$6,500, $4,167 and $3,333, respectively, of their salaries in the form of
shares of the Company's Class A Common Stock. In 1993, the salaries of
Messrs. Giard and Smith were comprised, in part, of cash payments for
accrued but unused vacation time in the amount of $13,846 and $8,307,
respectively. In 1992, the salaries of Messrs. Giard, Smith, Tholstrom and
DeBoer were comprised, in part, of cash payments for accrued but unused
vacation time in the amounts of $21,635, $8,625, $1,322 and $11,923,
respectively. In 1991, the salaries of Messrs. Giard, Smith, Tholstrom and
DeBoer were comprised, in part, of cash payments for accrued but unused
vacation time in the amounts of $21,635, $15,749, $1,562 and $1,538,
respectively.
(3) The options listed cover shares of Class B Common Stock except for Mr.
Hardesty's shares and 1993 options which are shares of Class A Common
Stock. See "Stock Option Grants" and "Compensation Committee Report on
Executive Compensation". References to "SARs" in the Summary Compensation
Table and all other tables in this Proxy Statement have been omitted, since
the Company has never issued stock appreciation rights.
(4) Includes Company contributions to the ESOP in an amount equal to 15% (to a
maximum of $30,000) of cash compensation paid in each calendar year.
Participation of an employee in the ESOP is subject to a one-year waiting
period.
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(5) Includes an estimated accrual of $135,138 in the Company's financial
statements for the benefit of Mr. Giard in respect of his supplemental
executive retirement plan ("SERP"). See "Long-Term Incentive Plans and
Pension Plans".
(6) Includes an estimated accrual of $60,155 in the Company's financial
statements for the benefit of Mr. Smith in respect of his SERP. See
"Long-Term Incentive Plans and Pension Plans".
(7) Mr. Hardesty joined the Company on December 15, 1992 at an annual salary of
$150,000.
STOCK OPTION GRANTS
1993 OPTION GRANTS
GRANT DATE
INDIVIDUAL GRANTS VALUE
- ------------------------------------------------------------------------------------------------ ----------
% OF TOTAL
NO. OF SHARES OPTIONS POTENTIAL
UNDERLYING GRANTED TO EXERCISE REALIZABLE
OPTIONS EMPLOYEES PRICE EXPIRATION VALUE($)
NAME GRANTED(1) IN 1993 ($/SHARE) DATE (2)
- ------------------------------------------- ------------- ---------- --------- ---------- ----------
George P. Giard, Jr........................ 235,000 25.6 1.8125 2003 274,480
Robert L. Smith............................ 125,000 13.6 1.8125 2003 146,000
Christopher S. Hardesty.................... 55,000 6.0 1.8125 2003 64,240
Kendell V. Tholstrom....................... 50,000 5.4 1.8125 2003 58,400
Bruce R. DeBoer............................ 40,000 4.4 1.8125 2003 46,720
- ---------------
(1) The options listed cover shares of Class A Common Stock which become
exercisable in equal increments after each of the first four years of
continuous employment after December 28, 1993, the grant date. The exercise
price was the closing price of Class A Common Stock on the American Stock
Exchange on such grant date.
(2) The grant date present value is determined by using the Black-Scholes Model.
The Black-Scholes Model is a complicated mathematical formula widely used
to value exchange traded options. However, stock options granted by the
Company to its executives differ from exchange traded options in three key
respects: options granted by the Company to its executives are long-term,
non-transferable and subject to vesting restrictions while exchange traded
options are short-term and can be exercised or sold immediately in a liquid
market. In this presentation, the Black-Scholes Model has been adapted to
estimate the present value of the options set forth in the table, taking
into consideration a number of factors, including expected volatility of
82%, risk-free rate of return of 7%, dividend yield of 0% and time to
exercise of 10 years. Consequently, because the Black-Scholes Model has
been adapted to value the options set forth in the table and is
assumption-based, it may not accurately determine present value. The actual
value, if any, an optionee will realize will depend on the excess of the
market value of the shares over the exercise price on the date the option
is exercised.
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OPTION EXERCISES AND HOLDINGS
AGGREGATED OPTION EXERCISES IN 1993
AND 1993 YEAR-END OPTION VALUES
NUMBER OF VALUE OF UNEXERCISED
UNEXERCISED OPTIONS IN-THE-MONEY OPTIONS
AT 12/31/93 AT 12/31/93
SHARES ------------------- --------------------
ACQUIRED ON VALUE EXERCISABLE/ EXERCISABLE/
NAME EXERCISE REALIZED UNEXERCISABLE(1) UNEXERCISABLE
- ---------------------------------------- ----------- -------- ------------------- --------------------
George P. Giard, Jr..................... -0- N/A 313,539/100,000 -0- / -0-
11,000/235,000 -0- /58,750
Robert L. Smith......................... -0- N/A 105,622/ 52,000 -0- / -0-
-0- /125,000 -0- /31,250
Christopher S. Hardesty................. -0- N/A -0- / -0- -0- / -0-
6,250/ 73,750 6,250/32,500
Kendell V. Tholstrom.................... -0- N/A 46,839/ 21,435 -0- / -0-
500/ 50,000 -0- /12,500
Bruce R. DeBoer......................... -0- N/A 18,997/ 14,461 -0- / -0-
-0- / 40,000 -0- /10,000
- ---------------
(1) All amounts listed in the first line for each individual are shares of Class
B Common Stock and all amounts listed in the second line for each
individual are shares of Class A Common Stock.
LONG-TERM INCENTIVE PLANS AND PENSION PLANS
The Company has no long-term incentive plan or defined benefit or actuarial
plan. However, Messrs. Giard and Smith have each entered into a Supplemental
Executive Retirement Agreement (the "SERP Agreement") with the Company which
provides each officer with cash benefits upon retirement in the form of a ten
year annuity with annual payments equal to a maximum of sixty percent (60%) of
each officer's average annual salary and bonus for the three (3) years preceding
retirement. The amount of annual benefit upon retirement is equal to (i) the
officer's final average earnings multiplied by a percentage factor based upon
years of service to the Company weighted separately for each officer so that
termination of employment at age sixty-five (65) provides a maximum factor of
sixty percent (60%) reduced by (ii) the value upon retirement, of such officer's
ESOP account and any other amounts payable to such officer under any other
qualified retirement plans adopted by the Company subsequent to the SERP
Agreement. Accordingly, the annual benefits payable upon retirement at normal
retirement age for Messrs. Giard and Smith are difficult to estimate due to the
offsetting value upon retirement of each officer's ESOP account which is
comprised solely of equity securities of the Company. As of April 18, 1994, Mr.
Giard is credited with 8 years of service and Mr. Smith is credited with 6 years
of service.
REPORT ON REPRICING OF OPTIONS
The Company has not adjusted or amended the exercise price of stock options
previously awarded to any of the named executive officers other than as reported
in previous proxy statements.
EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT AND CHANGE IN CONTROL
ARRANGEMENTS
No executive officer of the Company has an employment contract and there is
no compensatory plan or arrangement in respect of the resignation, retirement or
any other termination of any executive officer's employment with the Company or
a change-in-control or any change in executive responsibilities following a
change-in-control.
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COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The current members of the Compensation Committee are William D. Benjes,
Jr., Vincent Farrell, Jr. and J. Howard Marshall, II. No member of the
Compensation Committee of the Board of Directors during the last fiscal year is
or formerly was an officer or employee of the Company or any of its
subsidiaries. No executive officer of the Company and no member of the
Compensation Committee has or had any relationships requiring disclosure under
regulations applicable to this Proxy Statement.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee reviews and determines all compensation matters
for the Company's executive officers. The executive compensation program is
comprised of salary, annual cash incentives and long-term incentives principally
in the form of employee stock options and stock contributed to the ESOP. Each
year the Compensation Committee determines salary adjustments, if any, and the
level of benefit grants under the Company's Executive Bonus Program (the "EBP")
and its Incentive Stock Option Plan (the "ISOP") as well as the contribution
levels in respect of its ESOP. Generally, the Compensation Committee meets
toward the end of each fiscal year (and/or shortly thereafter) to consider
executive compensation matters, largely based on the achievements of the Company
in relation to certain performance targets. In respect of such matters, the
Compensation Committee also considers independent compensation studies relating
to compensation practices in the independent oil and gas industry, including
William M. Mercer, Incorporated and KPMG Peat Marwick. Such studies are
comprised of independent oil and gas companies choosing to participate therein
which differ from the companies comprising the Standard & Poor's Oil (Domestic
Integrated) Index used in the performance graph included herein. The
Compensation Committee believes that the compensation paid by such independent
companies, with a predominantly exploration and production (non-integrated) line
of business, is a better basis for compensation comparison than the integrated
companies included in the performance graph.
The Compensation Committee's executive compensation practices are designed
to provide competitive levels of base salary, annual bonus awards under the EBP
and stock options grants under the ISOP for the Company's executive officers,
that, in order of relative importance, (i) reflect the Company's achievements in
respect of the specific performance targets outlined below, (ii) recognize
individual initiative and achievement as well as levels of compensation in the
independent oil and gas industry, and (iii) assist the Company in attracting and
retaining qualified executives. The Compensation Committee utilizes compensation
studies to assure that the various components of the Company's total
compensation approximate survey averages within the independent oil and gas
industry, subject to further adjustment upon the subjective determination of the
Compensation Committee in respect of the three foregoing factors.
In addition to the three factors set forth above (and the compensation
surveys) which are generally utilized by the Compensation Committee in respect
of setting levels of total compensation for the executive officers as a group,
the Compensation Committee also considers various levels of responsibility,
prior experience, breadth of knowledge and internal equity issues in setting
base salary levels. Such salary levels for 1993 for the executive officers as a
group approximated compensation survey averages, and, as such, the salary levels
for 1993 were within five percent, plus or minus, of the applicable average.
Mr. Giard's 1993 base salary of $318,750 was determined in February 1993,
and thus reflected the Company's 1992 performance as well as competitive and
other factors existing at that time. Such salary was reduced 15% vis-a-vis his
1992 salary, and thus was significantly below the applicable survey averages.
In establishing the amounts of the 1993 bonus awards under the EBP and the
stock option grants under the ISOP, the Compensation Committee in particular
reviewed the Company's achievements in respect of its performance targets for
1993 which included: (i) oil and gas reserve replacement -- the Company's
yearend 1993 proved hydrocarbon reserves, on an equivalent barrel ("BOE") basis,
were to be equal to or greater than the Company's 1992 yearend proved
hydrocarbon reserves, less 15% of the Company's 1992 oil and gas production
(after adjustment for asset sales and the amount of capital expenditures made
during 1993); (ii) balance sheet improvement -- the Company's yearend 1993
current asset/current liability ratio was to be 1:1 or better and an exchange
offer involving the Company's Gas Indexed Notes was to be successfully
15
18
completed (70% or greater acceptance) by yearend 1993; (iii) return on
capital -- the rate of return on the capital of the Company, based on its 1993
EBITDA (earnings before interest, taxes and depreciation, as adjusted for the
impact of oil and gas production rates and pricing scenarios), was to be 15% or
greater; and (iv) equity performance -- the price of the Class A Common Stock
was to increase by 100% or more during 1993. The Company's achievements in 1993
were in excess of or substantially exceeded all of such performance targets,
each of which the Compensation Committee weighed equally.
The Company also achieved substantial administrative and operating
efficiencies in 1993. Its general and administrative costs declined to $5.3
million in 1993, down from $6.4 million in 1992, largely reflecting the
Company's continuing program to reduce such costs through the consolidation and
downsizing of various divisional offices and associated operations. Presidio's
production costs also declined in 1993 to $4.10 per BOE, compared to $4.38 per
BOE in 1992. In addition, the Company reduced its long-term bank debt to $15
million (and to $3.5 million as of March 31, 1994), down from $73 million at
yearend 1992.
In recognition of the Company's overall achievements in 1993, both in terms
of substantially exceeding its performance goals, as well as in realizing
significant operating and administrative efficiencies and a substantial
reduction in its long-term bank debt in such year, the Compensation Committee
made a subjective determination that resulted in 1993 bonus awards under the EBP
and stock option grants under the ISOP for the executive officers as a group
which, depending upon the executive's position, (i) in respect of bonus awards
under the EBP, consisted of cash payments that ranged from 22% to 35% of base
salary and (ii) in respect of the stock option grants under the ISOP, consisted
of grant date option values that ranged from 43% to 86% of base salary.
In 1993, Mr. Giard received a $100,000 bonus and an option to purchase
235,000 shares of Class A Common Stock which primarily reflected the Company's
overall 1993 achievements relative to its performance targets under Mr. Giard's
leadership.
In respect of the ESOP, which is the only qualified retirement plan
relating to all Company employees, the Compensation Committee has in recent
years authorized annual contributions for each employee of the Company
(including the executive officers as a group) equal to 15% (up to a maximum of
$30,000 per employee) of such employee's eligible cash compensation. Such
contributions are in the form of the Company's common stock, and the annual
amount thereof is determined by the Compensation Committee based upon general
levels of compensation in the independent oil and gas industry and without
specific reference to the above-mentioned executive compensation practices which
relate to the executive officers as a group.
The Omnibus Budget Reconciliation Act of 1993 contains provisions which
limit the tax deductibility of executive compensation in excess of $1 million
per year, subject to certain exceptions. The current policy of the Company is to
design its compensation programs to preserve the tax deductibility of
compensation paid to its executive officers and other members of management.
However, the Compensation Committee could in the future determine, taking into
consideration the relevant factors then in existence, to make awards or approve
compensation that does not qualify for a compensation deduction for tax
purposes, if the Compensation Committe believes it is in the Company's interest
to do so.
The Compensation Committee intends to maintain its practice of providing a
competitive salary structure for its CEO and other executive officers and basing
salary levels, bonus and other compensation on corporate and individual
performance. In this respect, the Compensation Committee continues to establish
annual performance goals to be achieved by the CEO and the Company's other
executive officers.
William D. Benjes, Jr., Co-Chairman
Vincent Farrell, Jr., Co-Chairman
J. Howard Marshall, II
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PERFORMANCE GRAPH
The following performance graph compares, for the 1988-1993 period, the
percentage changes in the Company's cumulative total shareholder return on its
Class A Common Stock to that of the American Stock Exchange Market Value Index
and the S&P Oil-Domestic Integrated Index. All cumulative returns assume
reinvestment of dividends.
CUMULATIVE SHAREHOLDER RETURN COMPARISON
(Graph)
S&P OIL -
MEASUREMENT PERIOD PRESIDIO OIL AMEX MARKET DOMESTIC IN-
(FISCAL YEAR COVERED) COMPANY VALUE TEGRATED
--------------------- ------------ ----------- ------------
1988 100.00 100.00 100.00
1989 174.56 123.53 137.00
1990 105.85 100.69 126.76
1991 70.47 129.10 108.05
1992 18.72 130.46 109.95
1993 44.12 155.93 111.21
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COMPENSATION OF DIRECTORS
CASH COMPENSATION
Directors of the Company are each entitled to receive $2,500 for each
meeting of the Board of Directors and $2,000 for each meeting of a committee
(other than the Nominating Committee) of the Board of Directors that they attend
in addition to reimbursement for travel expenses. Directors who are also
employees of the Company are not compensated separately for their service as
directors of the Company or its subsidiaries.
STOCK OPTION PLANS FOR NON-EMPLOYEE DIRECTORS
Under four (4) Stock Option Plans for Non-Employee Directors (previously
defined as the "DSOPs"), respectively effective in 1987, 1989, 1991 and 1992,
each of the then current non-employee directors of the Company was granted
options to purchase shares of Class B Common Stock and each then current non-
employee director who was a member of the Executive Committee of the Board of
Directors was granted an option to purchase additional shares of Class B Common
Stock. The aggregate number of shares of Class B Common Stock covered by such
options is 294,863. (If the 1993 DSOP is approved, the number of options
outstanding under the DSOPs will be increased by 225,000 shares of Class A
Common Stock). The exercise price for such options was the market price for the
applicable Class A Common Stock and Class B Common Stock on the dates when each
of the DSOPs was approved by the Compensation Committee, as ratified by the
Company's stockholders. No options granted under the DSOPs have been exercised.
1993 DSOP
As discussed previously in "Adoption of 1993 Stock Option Plan for
Non-Employee Directors", the Board of Directors is recommending that the
stockholders approve a new stock option plan for the Company's non-employee
directors. See Appendix A for the full text of the 1993 DSOP.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
In connection with the July 1992 sale of Mountain Gas Resources, Inc.
("MGRI "), a subsidiary of the Company, to an independent third party, George P.
Giard, Jr. and Robert L. Smith, at the request of such third party, entered into
consulting agreements with MGRI which provided for Mr. Giard and Mr. Smith to be
retained as consultants for a period of two (2) years. In consideration of the
provision of such services, each received options to purchase 6,000 shares of
MGRI Class A Common Stock, $.01 par value per share, at an exercise price of
$60.00 per share. In July 1993, MGRI was sold and each of Mr. Giard and Mr.
Smith received proceeds of $281,000 as a result of the sale of such options.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers and directors, and persons who own more than ten percent (10%) 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
("SEC ") and the American Stock Exchange. Officers, directors and greater than
ten percent (10%) shareholders are required by SEC regulation to furnish the
Company with copies of all Section 16(a) forms they file.
Based solely on review of the copies of such forms furnished to the
Company, or written representations that no Forms 5 were required, the Company
believes that during the period from January 1, 1993 to December 31, 1993, all
Section 16(a) filing requirements applicable to its officers, directors and
greater than ten percent (10%) beneficial owners were complied with, except that
two reports covering an aggregate of two hundred twenty-two transactions were
filed late by the Company's Employee Stock Ownership Plan Trust, George P.
Giard, Jr. and Robert L. Smith, as Co-Trustees thereof, and one report covering
an aggregate of two transactions, was filed late by Vincent Farrell, Jr., a
director of the Company.
18
21
ACCOUNTANTS
Deloitte & Touche ("Deloitte") served as the Company's independent auditors
for the fiscal year ended December 31, 1993 and has been selected by the Board
of Directors to serve in such capacity for the current fiscal year.
Representatives of Deloitte are expected to be present at the Annual Meeting to
be available to respond to appropriate questions and to make a statement if they
desire.
STOCKHOLDER PROPOSALS
In accordance with rules of the SEC, stockholders of the Company may
present proposals to the Company for inclusion in the Company's Proxy Statement
prepared in connection with its next regular annual meeting of stockholders.
Such proposals must be received by the Company no later than December 31, 1994,
in order to be considered for inclusion in the Proxy Statement for the 1995
annual meeting.
OTHER MATTERS
The Board of Directors knows of no matters other than those discussed in
this Proxy Statement that properly may be, or are likely to be, brought before
the meeting. In the event any other matters are properly brought before the
meeting, however, the proxy holders or their substitutes will vote in accordance
with their best judgment on such matters.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ BRUCE R. DEBOER
BRUCE R. DEBOER
Corporate Secretary
April 28, 1994
A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR
ENDED DECEMBER 31, 1993, EXCLUSIVE OF EXHIBITS, IS AVAILABLE TO EACH BENEFICIAL
OWNER OF THE COMPANY'S SECURITIES WITHOUT CHARGE UPON WRITTEN REQUEST SETTING
FORTH A GOOD FAITH REPRESENTATION THAT AS OF THE RECORD DATE, SUCH PERSON WAS A
BENEFICIAL OWNER OF THE COMPANY'S SECURITIES ENTITLED TO VOTE, TO: CORPORATE
SECRETARY, PRESIDIO OIL COMPANY, 5613 DTC PARKWAY, SUITE 750, P.O. BOX 6525,
ENGLEWOOD, COLORADO 80155-6525.
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APPENDIX A
PRESIDIO OIL COMPANY
1993 STOCK OPTION PLAN
FOR NON-EMPLOYEE DIRECTORS
RECITALS
A. Pursuant to a resolution dated January 11, 1994 and effective as of the
Effective Date (as defined below), the Executive Committee of the Board of
Directors (the "Board") of Presidio Oil Company, a Delaware corporation (the
"Company"), adopts this 1993 Stock Option Plan for Non-Employee Directors (the
"Plan").
B. The purposes of the Plan are to secure for the Company the benefits
arising from capital stock ownership of its non-employee directors by providing
to such directors added incentive to continue in the service of the Company and
a more direct interest in the future success of the operations of the Company by
granting to such directors an option (individually, the "Option") to purchase
shares of the Company's Class A Common Stock, $.10 par value per share (the
"Stock"), subject to the terms and conditions described below.
ARTICLE I
GENERAL
1.01 Definitions. For the purpose of this Plan, and as used herein a
"non-employee director" is an individual who (a) is a member of the Board and
(b) is neither an employee nor an officer of the Company. For purposes of this
Plan, an employee is an individual whose wages are subject to the withholding of
federal income tax under Section 3401 of the Internal Revenue Code of 1986, as
it may be amended from time to time (the "Code"), and an officer is an
individual elected or appointed by the Board or chosen in such other manner as
may be prescribed in the Bylaws of the Company to serve as such.
1.02 Options. The Options granted hereunder shall be options that are not
qualified as incentive stock options under Section 422 of the Code.
ARTICLE II
ADMINISTRATION
2.01 The Committee. The Plan shall be administered by the Compensation
Committee of the Board (the "Committee"), which shall be composed of not fewer
than three persons who shall be appointed by and serve at the pleasure of the
Board. Each member of the Committee shall be a person who at the time he or she
acts in administering the Plan is not eligible, and has not at any time within
one year prior thereto been eligible, for selection as a person to whom stock
may be allocated or to whom stock options or stock appreciation rights may be
granted pursuant to any other plan of the Company or any of its affiliates
entitling the participants therein to acquire stock, stock options or stock
appreciation rights of the Company or any of its affiliates, except for the 1992
Stock Option Plan for Non-Employee Directors effective April 16, 1993, the 1991
Stock Option Plan for Non-Employee Directors, effective December 27, 1991, the
1989 Stock Option Plan for Non-Employee Directors effective December 16, 1988
and the Stock Option Plan for Non-Employee Directors effective December 10,
1987.
2.02 Quorum. A majority of the Committee shall constitute a quorum, and the
acts of a majority of the members present at any meeting at which a quorum is
present or participating by the means described in the last sentence of this
Section 2.02, or acts approved in writing by a majority of the Committee, shall
be the acts of the Committee. The Committee shall keep minutes of its meetings.
One or more members of the Committee may participate in a meeting of the
Committee by means of conference telephone or similar communications equipment
by means of which all persons participating in the meeting can hear each other.
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23
2.03 Authority of the Committee. The Committee shall have no authority,
discretion or power to select the participants who will receive Options, to set
the number of shares to be covered by each Option, or to set the exercise price
or the period within which the Options may be exercised or to alter any other
terms or conditions specified herein, except in the sense of administering the
Plan subject to the provisions of the Plan. Subject to the foregoing
limitations, the Committee shall have authority and power to adopt such rules
and regulations and to take such action as it shall consider necessary or
advisable for the administration of the Plan, and to construe, interpret and
administer the Plan and the decisions of the Committee shall be final and
binding upon the Company, the Holders (as defined in Section 3.02 below) and all
other persons. No member of the Committee shall incur any liability by reason of
any action or determination made in good faith with respect to the Plan or any
stock option agreement.
ARTICLE III
OPTIONS
3.01 Participation. Each individual who is a non-employee director of the
Company on the Effective Date shall receive an Option to purchase Stock under
the Plan on the terms and conditions herein described.
3.02 Stock Option Agreements. Each Option granted under the Plan shall be
evidenced by a written stock option agreement, which shall be entered into by
the Company and the non-employee director to whom the Option is granted (the
"Holder"), and which shall include or conform to the following terms and
conditions, and which may include such other terms and conditions, if any, not
inconsistent therewith or with the terms and conditions of this Plan as the
Committee considers appropriate in each case.
(a) Number. Each individual who is a non-employee director on the
Effective Date is entitled to receive under the Plan an option to purchase
25,000 shares of Stock. The number of shares of Stock relating to each
Option shall be subject to adjustment from and after the Effective Date as
provided in Section 4.02 hereof.
(b) Price and Date. The date of grant of the initial Options granted
hereunder shall be the Effective Date of the Plan. The "Effective Date" of
the Plan shall be December 28, 1993, subject to the application of Section
6.04. The price at which each share of Stock covered by an Option may be
purchased shall be at least one hundred percent (100%) of the fair market
value of such share on the date of grant, and for the initial Options
granted hereunder shall be $1.8125 per share, which was the fair market
value of the Stock on the Effective Date. For purposes of this
determination "fair market value" means the closing price of a share of
Stock as reported on the American Stock Exchange on the date of grant. If
no such closing price is reported, then fair market value shall mean the
closing price of a share of Stock as reported on the American Stock
Exchange on the next preceding date when the Stock was traded.
(c) Option Period. The period within which each Option may be
exercised shall expire, in all cases, ten years from the date of grant of
the Option (the "Option Period"), unless terminated sooner pursuant to
subsection (d) below or fully exercised prior to the end of such period.
(d) Termination of Service, Death, Etc. With respect to the exercise
of an Option in the event that the Holder ceases to be a non-employee
director of the Company for the reasons described in this Section 3.02(d):
(i) If the Holder becomes disabled (within the meaning of Section
22(e)(3) of the Code) while in a directorship of the Company (including
the additional three month period provided in subsection (iii) of this
Section 3.02(d)), the Option may be exercised within one year following
the cessation of service because of such disability (if otherwise within
the Option Period). In any such case, the Option may be exercised only
as to the shares as to which the Option had become exercisable on or
before the date of the Holder's cessation of service; or
(ii) If the Holder shall die while in a directorship of the Company
(including during the additional three month period provided by
subsection (iii) of this Section 3.02(d)), the Option may be exercised
within one year following such death (if otherwise within the Option
Period), but not thereafter, by the Holder's legal representative or
representatives, or by the person or persons entitled
A-2
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to do so under the Holder's last will and testament, or if the Holder
shall fail to make testamentary disposition of his Option or shall die
intestate, by the person or persons entitled to receive said Option
under the laws of descent and distribution. In any such case, the Option
may be exercised only as to the shares as to which the Option had become
exercisable on or before the date of the Holder's death; or
(iii) If the directorship of a Holder is terminated for any reason
(other than the circumstances specified in subsections (i) and (ii) of
this Section 3.02(d)) within the Option Period, the Option may be
exercised within three months following the date of such termination (if
otherwise within the Option Period), but not thereafter. In any such
case, the Option may be exercised only as to the shares as to which the
Option had become exercisable on or before the date of the Holder's
cessation of service.
(e) Transferability. Each Option granted under the Plan shall not be
transferable by the Holder except by will or pursuant to the laws of
descent and distribution, and shall be exercisable during the Holder's
lifetime only by the Holder.
(f) Exercise, Payments, Etc. The method for exercising each Option
granted pursuant to the Plan shall be by delivery to the Company of written
notice specifying the number of shares with respect to which the Option is
exercised. If requested by the Company, such notice shall contain the
Holder's representation that he is purchasing the Stock for investment
purposes only and his agreement not to sell any stock so purchased in any
manner that is in violation of the Securities Act of 1933, as amended, or
any applicable state law. Such restrictions, or notice thereof, shall be
placed on the certificates representing the Stock so purchased. The
purchase of such Stock shall take place at the principal offices of the
Company within twenty days following delivery of such notice, at which time
the purchase price of the Stock shall be paid in full in cash, by certified
or cashier's check payable to the Company's order, or by delivery to the
Company of certificates representing the number of shares of Stock then
owned by the exercising Holder, the fair market value of which, on the date
of exercise, equals the purchase price of the Stock purchased pursuant to
the Option, properly endorsed for transfer to the Company, or, by any
combination of such methods of payment; provided, however, that no Option
may be exercised by delivery of certificates representing Stock unless the
Holder has held such Stock for more than six months. A properly executed
certificate or certificates representing the Stock shall be delivered to
the Holder upon payment therefor. The "fair market value" of any shares of
the Company's Stock which may be delivered upon exercise of the Option
shall be determined in the manner consistent with Section 3.02(b) hereof.
(g) Service Required For Exercise. Each Option shall become
exercisable in equal increments after each of the first four years of
continuous service by the Holder as a non-employee director of the Company
after the date of grant of the Option as follows:
NUMBER OF SHARES AS TO ALL OR
REQUIRED NUMBER OF YEARS PART OF WHICH THE OPTION MAY BE
OF CONTINUOUS SERVICE AS EXERCISED AFTER SUCH PERIOD
A NON-EMPLOYEE DIRECTOR OF CONTINUOUS SERVICE AS
AFTER THE DATE OF GRANT A NON-EMPLOYEE DIRECTOR
- ------------------------ ----------------------------------
1................................................. 1/4 of the total number of shares
covered by the Option
2................................................. An additional 1/4
3................................................. An additional 1/4
4................................................. An additional 1/4
No part of the Option shall be exercisable until after the first full year of
continuous service after the date of grant of the Option. Except as set forth in
Article 5 hereof, the Option shall not be exercisable as to any shares as to
which the continuous service requirement shall not be satisfied, regardless of
the circumstances under which the Holder's service to the Company shall be
terminated. The number of shares as to which the Option may be exercised shall
be cumulative, so that once the Option shall become exercisable as to any shares
it shall continue to be exercisable as to such shares, until expiration or
termination of the Option as provided in the Plan.
A-3
25
ARTICLE IV
AUTHORIZED STOCK
4.01 The Stock. The total number of shares of Stock as to which Options may
be granted pursuant to the Plan shall not exceed 225,000, in the aggregate,
except as such number of shares shall be adjusted from and after the Effective
Date in accordance with the provisions of Section 4.02 hereof. If any
outstanding Option under the Plan shall expire or be terminated for any reason
before the end of the Option Period, the shares of Stock allocable to the
unexercised portion of such Option may be reallocated under the Plan. The
Company shall at all times during the life of any outstanding Options retain as
authorized and unissued shares or treasury shares at least the number of shares
from time to time included in the outstanding Options, or otherwise assure
itself of its ability to perform its obligations under the Plan.
4.02 Adjustments by Stock Split, Stock Dividend, Etc. If the Company shall
at any time increase or decrease the number of its outstanding shares of Stock,
or change in any way the rights and privileges of such shares by means of the
payment of a stock dividend or the making of any other distribution upon such
shares payable in Stock, or through a stock split or subdivision of shares, or a
consolidation or combination of shares, or through a reclassification or
recapitalization involving the Stock, the numbers, rights and privileges of the
following shall be increased, decreased or changed in like manner as if they had
been issued and outstanding, fully paid and nonassessable at the time of such
occurrence: (a) the shares of Stock with respect to which Options may be granted
under the Plan; (b) the maximum number of shares of Stock with respect to which
a non-employee director may receive an Option hereunder; and (c) the shares of
Stock then included in each outstanding Option granted hereunder.
4.03 Dividend Payable in Stock of Another Corporation, Etc. If the Company
shall at any time pay or make any dividend or other distribution upon the Stock
payable in securities or other property (except money or Stock), a proportionate
part of such securities or other property shall be set aside and delivered to
any Holder then holding an Option for the Stock, upon exercise thereof.
4.04 Other Changes in Stock. In the event there shall be any change, other
than as specified in Sections 4.02 and 4.03, in the number or kind of
outstanding shares of Stock or of any stock or other securities into which the
Stock shall be changed or for which it shall have been exchanged, then and if
the Committee shall in its discretion determine that such change equitably
requires an adjustment in the number or kind of shares subject to outstanding
Options or which have been reserved for issuance pursuant to the Plan but are
not then subject to an Option, such adjustments shall be made by the Committee
and shall be effective for all purposes of the Plan and on each outstanding
stock option agreement.
4.05 Apportionment of Price. Upon any occurrence described in the preceding
Sections 4.02, 4.03 and 4.04, the total exercise price under any then
outstanding Option shall remain unchanged but shall be apportioned ratably over
the increased or decreased number or changed kinds of securities or other
property subject to the option.
4.06 Rights to Subscribe. If the Company shall at any time grant to the
holders of its Stock rights to subscribe pro rata for additional shares thereof
or for any other securities of the Company or of any other corporation, there
shall be added to the number of shares then under option to any Holder the Stock
or other securities which the Holder would have been entitled to subscribe for
if immediately prior to such grant the Holder had exercised his entire Option,
and the option price shall be increased by the amount of the price which would
have been payable by the Holder for such Stock or other securities.
4.07 General Adjustment Rules. No adjustment or substitution provided for
in this Article IV shall require the Company to sell a fractional share under
any stock option agreement and the total substitution or adjustment with respect
to each stock option agreement shall be limited by deleting any fractional
share. In the case of any such substitution or adjustment, the exercise price
per share in each such stock option agreement shall be equitably adjusted by the
Committee to reflect the greater or lesser number of shares of Stock or other
securities into which the Stock subject to the Option may have been changed.
A-4
26
4.08 Determination by the Committee, Etc. Adjustments under this Article IV
shall be made by the Committee, whose determinations with regard thereto shall
be final and binding. No fractional shares of Stock shall be issued on account
of any such adjustment.
ARTICLE V
REORGANIZATION OR LIQUIDATION
5.01 Effect of Merger, Consolidation, Etc. Upon the occurrence of any of
the following events, if the notice required by Section 5.02 shall have first
been given, this Plan and all options then outstanding under it shall
automatically terminate and be of no further force and effect whatever, without
the necessity for any additional notice or other action by the Committee, the
Board or the Company: (a) the merger, consolidation or liquidation of the
Company or the acquisition of its assets or stock pursuant to a nontaxable
reorganization (but only if the Company is not the surviving corporation),
unless the surviving or acquiring corporation, as the case may be, shall assume
the outstanding options or substitute new options for them pursuant to Section
424(a) of the Code; (b) the dissolution or liquidation of the Company; (c) the
appointment of a receiver for all or substantially all of the Company's assets
or business; (d) the appointment of a trustee for the Company after a petition
has been filed for the Company's reorganization under applicable statutes; or
(e) the sale, lease or exchange of all or substantially all of the Company's
assets and business.
5.02 Notice of Such Occurrences. At least thirty (30) days prior written
notice of any event described in Section 5.01, except the transactions described
in subsections 5.01(c) and (d) as to which no notice shall be required, shall be
given by the Company to each Holder theretofore granted an Option under the
Plan. The Holders so notified may exercise their Options at any time before the
occurrence of the event requiring the giving of notice, regardless of whether
all conditions of exercise relating to continuation of employment for specified
periods of time have been satisfied. Such notice shall be deemed to have been
given when delivered personally to a Holder or when mailed to a Holder by
registered or certified mail, postage prepaid, at such Holder's last address
known to the Company.
ARTICLE VI
GENERAL PROVISIONS
6.01 Expiration. The Plan shall terminate whenever the Board adopts a
resolution to that effect. If not sooner terminated under the preceding
sentence, the Plan shall wholly cease and expire ten years after the Effective
Date. After termination, no Option shall be granted under this Plan, but the
Company shall continue to recognize Options previously granted.
6.02 Amendments, Etc. The Board may from time to time amend, modify,
suspend or terminate the Plan. Nevertheless, no such amendment, modification,
suspension or termination shall (a) impair any Option theretofore granted under
the Plan or deprive any Holder of any shares of Stock which he may have acquired
through or as a result of the Plan, or (b) be made without the approval of the
stockholders of the Company where such change would (i) materially increase the
total number of shares of Stock which may be issued under the Plan, (ii)
materially alter the class of persons eligible to be granted Options under the
Plan, or (iii) materially increase the benefits accruing to Holders under the
Plan.
6.03 Treatment of Proceeds. Proceeds from the sale of Stock pursuant to
Options granted under the Plan shall constitute general funds of the Company.
6.04 Effectiveness. This Plan shall become effective as of the Effective
Date, subject to the conditions stated in the following sentence. This Plan and
any Option granted pursuant hereto are conditional on and shall be of no force
and effect unless and until approval of the Plan by the holders of a majority of
the voting power of the shares of the common stock present or represented and
entitled to vote at a meeting of stockholders of the Company held within one
year following the date of the Plan's adoption by the Board set forth herein.
6.05 Paragraph Headings. The paragraph headings are included herein only
for convenience, and they shall have no effect on the interpretation of the
Plan.
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27
PRESIDIO OIL COMPANY
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR ANNUAL MEETING OF STOCKHOLDERS, JUNE 14, 1994
The undersigned stockholder of Presidio Oil Company, a Delaware
corporation ("Presidio"), hereby appoints George P. Giard, Jr. and Robert L.
Smith, and each of them, as proxies of the undersigned, with full power of
substitution, to vote all the shares of CLASS A COMMON STOCK, $.10 par value
per share, of Presidio which the undersigned may be entitled to vote at the
Annual Meeting of Stockholders of Presidio to be held in the Board Room of The
Chase Manhattan Bank Executive Conference Facility, Fifth Floor, 410 Park
Avenue, New York, New York, on Tuesday, June 14, 1994 at 9:00 A.M. Eastern
Time, and at any adjournment or postponement of such meeting, with all powers
which the undersigned would possess if personally present, on the matters set
forth on the reverse side of this proxy and such other matters as may properly
come before such meeting.
THIS PROXY WILL BE VOTED AS DIRECTED. IF NO DIRECTION IS INDICATED,
THIS PROXY WILL BE VOTED FOR THE ELECTION OF ALL NOMINEES FOR DIRECTOR AND FOR
ADOPTION OF PROPOSAL NO. 2.
(Continued, and to be dated and signed on reverse side.)
28
1. Election of Directors (Class C FOR all nominees listed below WITHHOLD AUTHORITY to
Nominees for a three year term (except as marked to the contrary) / / vote for all nominees listed / /
ending 1997): below
Nominees: George P. Giard, Jr., Peter H. Havens and Robert L. Smith
Instruction: To withhold authority to vote for any individual nominee write that nominee's name on the following line.
---------------------------------------------------------------------------------------------------------
2. Adoption of the 1993 Non-Employee Director Stock Option Plan. FOR / / AGAINST / / ABSTAIN / /
Address Change / /
PROXY DEPARTMENT
NEW YORK, N.Y. 10203-0809
This proxy should be dated, signed by the
stockholder as his or her name appears below,
and returned promptly in the enclosed envelope
whether or not the stockholder plans to attend
the meeting. Joint owners should each sign
personally, and attorneys, executors,
administrators, trustees, guardians or
custodians should indicate the capacity in
which they sign.
Dated: , 1994
----------------------------------
-------------------------------------------
Signature of Stockholder
-------------------------------------------
Signature of Stockholder
PLEASE SIGN AND PROMPTLY RETURN IN THE ACCOMPANYING ENVELOPE.
NO POSTAGE REQUIRED IF MAILED IN THE UNITED STATES OF AMERICA. VOTES MUST BE INDICATED (X) IN BLACK OR BLUE
INK.
29
PRESIDIO OIL COMPANY
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR ANNUAL MEETING OF STOCKHOLDERS, JUNE 14, 1994
The undersigned stockholder of Presidio Oil Company, a Delaware
corporation ("Presidio"), hereby appoints George P. Giard, Jr. and Robert L.
Smith, and each of them, as proxies of the undersigned, with full power of
substitution, to vote all the shares of CLASS B COMMON STOCK, $.10 par value
per share, of Presidio which the undersigned may be entitled to vote at the
Annual Meeting of Stockholders of Presidio to be held in the Board Room of The
Chase Manhattan Bank Executive Conference Facility, Fifth Floor, 410 Park
Avenue, New York, New York, on Tuesday, June 14, 1994 at 9:00 A.M. Eastern
Time, and at any adjournment or postponement of such meeting, with all powers
which the undersigned would possess if personally present, on the matters set
forth on the reverse side of this proxy and such other matters as may properly
come before such meeting.
THIS PROXY WILL BE VOTED AS DIRECTED. IF NO DIRECTION IS INDICATED,
THIS PROXY WILL BE VOTED FOR THE ELECTION OF ALL NOMINEES FOR DIRECTOR AND FOR
ADOPTION OF PROPOSAL NO. 2.
(Continued, and to be dated and signed on reverse side.)
30
1. Election of Directors (Class C FOR all nominees listed below WITHHOLD AUTHORITY to
Nominees for a three year term (except as marked to the contrary) / / vote for all nominees listed / /
ending 1997): below
Nominees: George P. Giard, Jr., Peter H. Havens and Robert L. Smith
Instruction: To withhold authority to vote for any individual nominee write that nominee's name on the following line.
---------------------------------------------------------------------------------------------------------
2. Adoption of the 1993 Non-Employee Director Stock Option Plan. FOR / / AGAINST / / ABSTAIN / /
Address Change / /
PROXY DEPARTMENT
NEW YORK, N.Y. 10203-0809
This proxy should be dated, signed by the
stockholder as his or her name appears below,
and returned promptly in the enclosed envelope
whether or not the stockholder plans to attend
the meeting. Joint owners should each sign
personally, and attorneys, executors,
administrators, trustees, guardians or
custodians should indicate the capacity in
which they sign.
Dated: , 1994
----------------------------------
-------------------------------------------
Signature of Stockholder
-------------------------------------------
Signature of Stockholder
PLEASE SIGN AND PROMPTLY RETURN IN THE ACCOMPANYING ENVELOPE.
NO POSTAGE REQUIRED IF MAILED IN THE UNITED STATES OF AMERICA. VOTES MUST BE INDICATED (X) IN BLACK OR BLUE
INK.