UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
SCHEDULE
14A INFORMATION
Proxy
Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
Filed
by the Registrant ☒
Filed
by a Party other than the Registrant ☐
Check
the appropriate box:
| ☐ |
Preliminary Proxy Statement |
| ☐ |
Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2)) |
| ☒ |
Definitive Proxy Statement |
| ☐ |
Definitive Additional Materials |
| ☐ |
Soliciting Material Pursuant to §240.14a-12 |
MEXCO
ENERGY CORPORATION
(Name
of Registrant as Specified In Its Charter)
(Name
of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment
of Filing Fee (Check the appropriate box):
| ☒ |
No fee required. |
| |
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| ☐ |
Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11. |
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| ☐ |
Fee paid previously with preliminary materials. |
MEXCO
ENERGY CORPORATION
415
W. Wall, Suite 475
Midland,
Texas 79701
(432)
682-1119
NOTICE
OF ANNUAL MEETING OF STOCKHOLDERS
To
be held September 10, 2024
TO
THE STOCKHOLDERS OF MEXCO ENERGY CORPORATION:
Notice
is hereby given that the Annual Meeting of the Stockholders of MEXCO ENERGY CORPORATION (referred to herein as the “Company”
or “Mexco”) will be held at the Company’s principal office located at 415 West Wall, Suite 475, Midland, Texas 79701,
at 2:00 p.m. on September 10, 2024, for the following purposes:
1.
Electing Directors of the Company.
2.
Ratifying the selection of Weaver and Tidwell, L.L.P. as the Company’s independent registered public accounting firm for the fiscal
year ending March 31, 2025.
3.
Voting upon a non-binding advisory resolution regarding the compensation of our named executive officers as disclosed in this Proxy Statement.
4.
Considering all other matters as may properly come before the meeting.
The
Board of Directors has fixed the close of business on July 22, 2024 as the record date for the determination of stockholders entitled
to notice of and to vote at the meeting and at any adjournment or adjournments thereof.
DATED
this 22nd day of July, 2024.
| |
BY
ORDER OF THE BOARD OF DIRECTORS |
| |
|
| |
STACY D. HARDIN, Secretary |
To
be sure your shares are represented at the Annual Meeting of Stockholders, please vote by completing, dating, signing and returning your
pre-addressed postage-paid Proxy Card as soon as possible. You may also vote by internet or by telephone. See the enclosed proxy card
for more information. Any stockholder granting a proxy may revoke the same at any time prior to its exercise by executing a subsequent
proxy or by written notice to the Secretary of the Company or by attending the meeting and by withdrawing the proxy. You may vote in
person at the Annual Meeting of Stockholders even if you send in your Proxy Card. The ballot you submit at the meeting will supersede
any prior vote.
Important
Notice Regarding the Availability of Proxy Materials for the
Shareholder Meeting to be Held on September 10, 2024:
Our
Annual Report on Form 10-K and this Proxy Statement are available at
www.iproxydirect.com/MXC
TABLE
OF CONTENTS
MEXCO
ENERGY CORPORATION
415
W. Wall, Suite 475
Midland,
Texas 79701
PROXY
STATEMENT
ANNUAL
MEETING OF STOCKHOLDERS
To
Be Held Tuesday, September 10, 2024
PROXY
INFORMATION
SOLICITATION
OF PROXY
The
accompanying proxy is solicited on behalf of the Board of Directors of Mexco Energy Corporation for use at the Annual Meeting of Stockholders
to be held at 2:00 p.m., Central Daylight Time, on Tuesday, September 10, 2024 at the Company’s principal office located at 415
West Wall, Suite 475, Midland, Texas 79701 and at any adjournment or postponements thereof (“Annual Meeting”). In addition
to the use of the mails, proxies may be solicited by personal interview via telephone by officers, directors and other employees of Mexco,
who will not receive additional compensation for such services. We may also request brokerage houses, nominees, custodians and fiduciaries
to forward the soliciting material to the beneficial owners of stock held of record and will reimburse such persons for forwarding such
material. We will bear the cost of this solicitation of proxies. Such costs are expected to be nominal. Proxy solicitation will commence
with the distribution of this Proxy Statement on or about August 1, 2024.
Any
stockholder giving a proxy has the power to revoke the same at any time prior to its exercise by executing a subsequent proxy or by written
notice to the Secretary of the Company or by attending the meeting and withdrawing the proxy.
As
used in this document, “the Company”, “Mexco”, “we”, “us” and “our” refer
to Mexco Energy Corporation and its consolidated subsidiaries.
PURPOSE
OF MEETING
As
stated in the Notice of Annual Meeting of Stockholders accompanying this Proxy Statement, the business to be conducted and the matters
to be considered and acted upon at the Annual Meeting are as follows:
| | 1. | Electing
Directors of the Company; |
| | | |
| 2. | Ratifying
the selection of Weaver and Tidwell, L.L.P. as Mexco’s independent registered public
accounting firm for the fiscal year ending March 31, 2025; |
| | | |
| 4. | Voting
upon a non-binding advisory resolution regarding the compensation of our named executive
officers as disclosed in this Proxy Statement; and |
| | | |
| 5. | Considering
all other matters as may properly come before the meeting. |
VOTING
RIGHTS
Right
to Vote and Record Date
The
voting securities of Mexco consist solely of common stock, par value $0.50 per share (“Common Stock”). The record date for
stockholders entitled to notice of and to vote at the meeting is the close of business on July 22, 2024, at which time there were 2,085,443
shares of Common Stock entitled to vote at the meeting. Stockholders are entitled to one vote, in person or by proxy, for each share
of Common Stock held in their name on the record date.
Quorum
Stockholders
representing a majority of the Common Stock outstanding and entitled to vote must be present or represented by proxy to constitute a
quorum. Abstentions and broker non-votes will be counted as present for the purpose of determining whether a quorum is obtained.
Voting
at the Annual Meeting
This
Proxy Statement was sent to all stockholders of record. If your shares are registered directly in your name with Issuer Direct Corporation,
you are the “stockholder of record” and may vote the shares at the annual meeting or by proxy by following the voting instructions
on the enclosed proxy card. Alternatively, if your shares are held in an account at a broker, brokerage firm, bank or other similar organization,
your shares are held in “street name” and you are the “beneficial holder”. The organization holding your shares
is the “stockholder of record” for purposes of voting the shares at the annual meeting. As the beneficial owner, you have
the right to direct that organization on how it should vote the shares held in your account by following the voting instructions on the
enclosed proxy card.
Whether
or not you are able to attend the meeting, we urge you to vote by proxy.
Vote
Required
All
proposals other than the election of directors will require the affirmative vote of a majority of the Common Stock present or represented
by proxy at the meeting and entitled to vote thereon.
With
regard to the election of directors, votes may be cast in favor of or withheld from each nominee. Votes that are withheld will be excluded
entirely from the vote and will have no effect. The election of directors is a non-routine proposal which means a broker can only vote
your shares if the broker receives instructions from you. Otherwise, your shares will not be voted on this proposal. Abstentions and
broker non-votes will have no effect on the outcome of the election of directors. Cumulative voting for directors is not authorized.
With
regard to the proposal to ratify the appointment of Weaver and Tidwell, L.L.P. as the independent registered public accounting firm of
the Company for the fiscal year ending March 31, 2025 votes may be cast “For”, “Against” or “Abstain”
for the proposal. The ratification of Weaver and Tidwell, L.L.P. is a routine proposal which means a broker has discretion to vote your
shares even if the broker does not receive voting instructions from you. An abstention will have the same effect as a vote against the
proposal. Broker non-votes will have no effect on determining whether the selection of Weaver and Tidwell, L.L.P. has been ratified.
With
regard to the proposal to approve a non-binding advisory resolution on the compensation of our named executive officers as disclosed
in this Proxy Statement, an abstention will have the same effect as a vote against the proposal. Broker non-votes and other limited proxies
will have no effect on the outcome of the vote with respect to such proposal. This vote is advisory in nature and will not be binding
on the Company.
Abstentions
and Broker Non-Votes
Abstentions
and broker non-votes (shares held by brokers or nominees as to which they have no discretionary power to vote on a particular matter
and have received no instructions from the beneficial owners of such shares or persons entitled to vote on the matter) will be counted
for the purpose of determining whether a quorum is present. For purposes of determining the outcome of any matter to be voted upon as
to which the broker has indicated on the proxy that the broker does not have discretionary authority to vote, these shares will be treated
as not present at the meeting and not entitled to vote with respect to that matter, even though those shares are considered to be present
at the meeting for quorum purposes and may be entitled to vote on other matters. Abstentions, on the other hand, are considered to be
present at the meeting and entitled to vote on the matter from which abstained.
If
the enclosed Proxy is properly executed and returned prior to the Annual Meeting, the shares represented thereby will be voted as specified
therein. IF A STOCKHOLDER DOES NOT SPECIFY OTHERWISE ON THE RETURNED PROXY, THE SHARES REPRESENTED BY THE STOCKHOLDER’S PROXY WILL
BE VOTED FOR THE ELECTION OF THE NOMINEES LISTED BELOW UNDER “PROPOSAL 1: ELECTION OF DIRECTORS”; FOR
THE APPOINTMENT OF WEAVER AND TIDWELL, L.L.P. AS SET FORTH UNDER “PROPOSAL 2: RATIFICATION OF SELECTION OF INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM”; FOR THE PROPOSAL TO APPROVE A NON-BINDING ADVISORY RESOLUTION ON THE COMPENSATION OF THE NAMED
EXECUTIVE OFFICERS AS DISCLOSED IN THIS PROXY STATEMENT AND AS DESCRIBED UNDER “PROPOSAL 3: ADVISORY VOTE ON EXECUTIVE COMPENSATION”;
AND ON SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE ANNUAL MEETING OR ANY ADJOURNMENTS THEREOF.
ACCESS
TO REPORTS
Stockholders
may obtain a copy of the Annual Report on Form 10-K and any of the other reports filed by Mexco with the SEC, free of charge, (1) from
the SEC’s website at www.sec.gov, (2) from our website at www.mexcoenergy.com, or (3) by writing to our Corporate Secretary at
our principal executive offices, P.O. Box 10502, Midland, Texas 79702 or by email to mexco@sbcglobal.net.
HOUSEHOLDING
The
SEC permits a single set of annual reports and proxy statements to be sent to any household at which two or more stockholders reside
if they appear to be members of the same family. Each stockholder continues to receive a separate proxy card. This procedure, referred
to as householding, reduces the volume of duplicate information stockholders receive and reduces mailing and printing expenses. A number
of brokerage firms have instituted householding.
As
a result, if you hold your shares through a broker and you reside at an address at which two or more stockholders reside, you will likely
be receiving only one annual report and proxy statement unless any stockholder at that address has given the broker contrary instructions.
However, if any such beneficial stockholder residing at such an address wishes to receive a separate annual report or proxy statement
in the future, or if any such beneficial stockholder that elected to continue to receive separate annual reports or proxy statements
wishes to receive a single annual report or proxy statement in the future, that stockholder should contact their broker or send a request
to our corporate secretary at our principal executive office mailing address, P.O. Box 10502, Midland, Texas 79702, telephone number
(432) 682-1119. We will deliver, promptly upon written or oral request to the corporate secretary, a separate copy of the 2024 Annual
Report and this proxy statement to a beneficial stockholder at a shared address to which a single copy of the documents was delivered.
PROPOSAL
1: ELECTION OF DIRECTORS
At
the Annual Meeting to be held on September 10, 2024, six persons are to be elected to serve on the Board of Directors (the “Board”)
for a term of one year and until their successors are duly elected and qualified. All of the nominees are current directors and have
announced that they are available for reelection to the Board. The Company’s nominees for the six directorships are:
Michael
J. Banschbach
Kenneth
L. Clayton
Thomas
R. Craddick
Thomas
H. Decker
Christopher
M. Schroeder
Nicholas
C. Taylor
The
Board of Directors recommends that you vote FOR the election of each of the Director nominees.
MEXCO
ENERGY CORPORATION BOARD OF DIRECTORS
The
Board has responsibility for establishing broad corporate policies and for overall performance and direction of the Company. The Board
is elected by the Stockholders to oversee their interests in the long-term health and the overall success of the Company’s business
and its financial strength. The Board serves as the ultimate decision-making body of the Company, except for those matters reserved to
or shared with the Stockholders. The Board selects and oversees the members of senior management, who are charged by the Board with conducting
the business of the Company. Members of the Board stay informed of the Company’s business by participating in Board and committee
meetings, by reviewing analyses and reports sent to them regularly, and through discussions with the Chief Executive Officer (“CEO”)
and Chief Financial Officer (“CFO”).
The
Board currently consists of one person who is an employee of the Company and five persons who are not employees of the Company (four
of which are outside directors). The Board has determined that each of the four outside directors, namely Messrs. Banschbach, Clayton,
Decker and Schroeder are independent in accordance with NYSE American rules and under the Securities Exchange Act of 1934, as amended
(“Exchange Act”). Set forth below are the names, ages and positions of Mexco’s directors as of July 22, 2024.
| Name |
|
Age |
|
Position |
| |
|
|
|
|
| Michael J. Banschbach |
|
66 |
|
Director |
| Kenneth L. Clayton |
|
80 |
|
Director |
| Thomas R. Craddick |
|
80 |
|
Director |
| Thomas H. Decker |
|
83 |
|
Director |
| Christopher M. Schroeder |
|
59 |
|
Director |
| Nicholas C. Taylor |
|
86 |
|
Chairman of the Board of Directors and CEO |
Set
forth below are descriptions of the principal occupations during at least the past five years of the Company’s current directors.
MICHAEL
J. BANSCHBACH was appointed to the Board of Directors of the Company in July 2014. Mr. Banschbach graduated from the Colorado School
of Mines in 1980 with a BS degree in Chemical Engineering. Thereafter, Mr. Banschbach served with Atlantic Richfield (ARCO) for twenty
years, primarily in the gas processing midstream sector, as both an engineer and as a commercial representative. From 2001 until the
present time, he has represented numerous independent oil and gas producing companies in negotiations with midstream companies for the
connection of newly drilled wells and for the sale of their oil and gas production. He has conducted seminars describing the movement
of gas from the wellhead to the burner tip, and the various financial transactions that take place along the way. He also serves with
various charitable organizations.
KENNETH
L. CLAYTON was appointed to the Board of Directors of the Company in September 2011. Mr. Clayton graduated from Austin College with
a Bachelor of Arts degree in Economics and from the University of Texas at Austin School of Law with a Doctor of Jurisprudence degree.
Mr. Clayton also attended the Graduate School of Business at the University of Texas at Austin. Mr. Clayton is a member of the State
Bar of Texas and the Houston Bar Association, and practices law in the areas of estate planning and probate. Mr. Clayton also serves
as President of Fiduciary Resources Company, a company he founded in 1984 to provide business management services to individual executors
of decedents’ estates and trustees of testamentary trusts. From 1970 through 1984, Mr. Clayton served as Senior Vice-President
and manager of the trust division of the Capital National Bank in Houston, Texas.
THOMAS
R. CRADDICK was elected to the Board of Directors of the Company in March 1998. Since 1968 to the present, Mr. Craddick has served
as a Representative of the Texas House of Representatives. He served as Speaker of the House for six years and throughout his tenure
of 26 sessions of the Legislature, Representative Craddick has served on various committees and conferences. Mr. Craddick is the owner
of Craddick Properties, owner and President of Craddick, Inc., all of which invest in oil and gas properties and real estate, and General
Partner of Craddick Partners, Ltd.
THOMAS
H. DECKER was elected to the Board of Directors of the Company in September 2019. Mr. Decker graduated from the University of Oklahoma
and served with Morgan Stanley from 2000 to 2019 as a Senior Vice President in financial advisory services. He served as a Senior Vice
President of Tucker Anthony, Inc. from 1980-1992 and as a Senior Vice President of Blyth Eastman Dillon, in financial advisory services
from 1978 to 1980 and in various positions up to a Senior Vice President at White, Weld, Inc. from 1971 to 1978 in investment banking
and advisory services. From 1973 to the present, he has served in a number of capacities with various charitable organizations. Also
Mr. Decker was a founder in 1998 of Painter Hill Venture Capital and from 1993 to 1998 as director of Shared Technologies, Inc.
CHRISTOPHER
M. SCHROEDER was appointed to the Board of Directors of the Company in October 2014. Mr. Schroeder graduated from the Harvard Business
School with a Masters of Business Administration degree with honors. From 1988 to 1992 he served as a special assistant on the staff
of Secretary of State James Baker III. In 1996, Mr. Schroeder joined The Washington Post Company and served in a variety of positions
during his four year tenure with the company, including Treasurer and Vice President of Business Development. From 1999 to 2000, Mr.
Schroeder was CEO of Legi-Slate, Inc., a business-to-business internet technology firm with The Washington Post Company as its lead shareholder.
From 2000 to 2005, he was the CEO and Publisher of Washingtonpost.Newsweek Interactive. In 2006, Mr. Schroeder co-founded and was CEO
of HealthCentral, one of the largest online content and wellness platforms. Currently Mr. Schroeder is an adviser to leading Silicon
Valley venture capital firms. Mr. Schroeder wrote a best-selling book in 2013: “Startup Rising: The Entrepreneurial Revolution
Remaking the Middle East.” He serves on several academic and global boards including The American University of Cairo School of
Business, The American University School of International Service, and The American Council on Germany, among others.
NICHOLAS
C. TAYLOR was elected Chairman of the Board and Chief Executive Officer of the Company in September 2011 and continues to serve in
such capacity on a part time basis, as required. Mr. Taylor served as Chief Executive Officer, President and Director of the Company
from 1983 to 2011. Mr. Taylor served as Treasurer until March 1999. From July 1993 to the present, Mr. Taylor has been involved in the
independent practice of law and other business activities including independent oil and gas exploration and production. For more than
the prior 19 years, he was a director and shareholder of the law firm of Stubbeman, McRae, Sealy, Laughlin & Browder, Inc., Midland,
Texas, and a partner of the predecessor firm. In 1995 he was appointed by the Governor of Texas to the State Securities Board through
January 2001. In addition to serving as chairman for four years, he continued to serve as a member until 2004. In November 2005 he was
appointed by the Speaker of the House to the Texas Ethics Commission for a term of five years, where he served until February 2010.
DIRECTOR
QUALIFICATIONS
Each
nominee brings a unique set of skills to the Board of Directors. The Board believes the nominees as a group have the experience and skills
in areas such as the oil and gas industry, finance, risk management and corporate governance that are necessary to effectively oversee
our company. Set forth below are the conclusions reached by the Board as to why each nominee is qualified for service as a director of
our company.
Mr.
Banschbach is a Chemical Engineer and has over 43 years experience in the oil and gas industry. Mr. Banschbach provides expertise
in areas of evaluating oil and gas markets.
Mr.
Clayton has over 53 years of banking, property management, finance and legal experience. Mr. Clayton provides expertise in the areas
of finance and management.
Mr.
Craddick has over 55 years experience in the oil and gas production and service industry. Mr. Craddick provides expertise in the
location, acquisition and divestiture of properties.
Mr.
Decker has over 52 years experience developing financial investment strategies and quantitative solutions for client investment portfolios
in a variety of high-level positions across the financial industry. Mr. Decker provides expertise in the area of finance and management.
Mr.
Schroeder is a former Chief Executive Officer of several companies in the area of technology and Treasurer and Vice President of
development of a public company. Mr. Schroeder provides expertise in the areas of management, entrepreneurship, financial reporting,
accounting, capital markets, internal controls and corporate governance.
Mr.
Taylor has been Mexco’s Chief Executive Officer for over 40 years and has over 49 years of experience practicing law. Mr. Taylor
provides expertise in the areas of evaluating, acquiring and managing oil and gas properties as well as exploration prospects.
DIRECTOR
COMPENSATION
The
following table sets forth the total compensation paid to or earned by each of the Company’s directors, who were not executive
officers, during fiscal year 2024.
| Director | |
Fees
Paid in Cash(1) | | |
Stock
Option Awards(2) | | |
All
Other Compensation | | |
Total | |
| Michael J. Banschbach | |
$ | 6,000 | | |
$ | - | | |
$ | - | | |
$ | 6,000 | |
| Kenneth L. Clayton | |
$ | 6,000 | | |
$ | - | | |
$ | - | | |
$ | 6,000 | |
| Thomas R. Craddick | |
$ | 6,000 | | |
$ | - | | |
$ | - | | |
$ | 6,000 | |
| Thomas H. Decker | |
$ | 6,000 | | |
$ | - | | |
$ | - | | |
$ | 6,000 | |
| Christopher M. Schroeder | |
$ | 6,000 | | |
$ | - | | |
$ | - | | |
$ | 6,000 | |
| (1) | Director’s
fees are paid at the rate of $1,500 per director quarterly. |
| (2) | The
amounts in this column reflect the aggregate grant date fair value attributable to stock
options granted in accordance with ASC 718, “Compensation - Stock Compensation”
pursuant to the 2019 Employee Incentive Stock Plan. For the year ended March 31, 2024 there
were no stock options granted to a director. |
CORPORATE
GOVERNANCE
The
Board of Directors and management are dedicated to exemplary corporate governance and high standards of conduct and ethics.
CODE
OF BUSINESS CONDUCT
The
Board adopted the Company’s Code of Ethics and Business Conduct (the “Code”) to inspire continuing dedication to the
fundamental principles of honesty, loyalty, fairness and forthrightness. The Code applies to all employees including directors and executive
officers. The Code can be found at www.mexcoenergy.com by clicking on “Investor Relations” then “Corporate Governance”.
Shareholders may request a free printed copy of the Code by contacting our Corporate Secretary at mexco@sbcglobal.net or by calling
(432) 682-1119.
DIRECTOR
INDEPENDENCE
In
accordance with Section 803A of the NYSE American Company Guide and under the Exchange Act, the Board must affirmatively determine the
independence of each director. The Board has determined each of the following directors to be an “independent director” as
such term is defined in said rules: Michael J. Banschbach, Kenneth L. Clayton, Thomas H. Decker and Christopher M. Schroeder. In this
proxy statement these four directors are referred to individually as an “Independent Director” and collectively as the “Independent
Directors.” The Board is comprised of a majority of Independent Directors and the Audit Committee, the Compensation Committee and
the Nominating Committee are comprised entirely of Independent Directors.
In
addition, the Board has determined that Mr. Decker, Chairman of the Audit Committee, is an “audit committee financial expert”
(as that term is defined under the applicable SEC rules and regulations) based on the Board’s qualitative assessment of Mr. Decker’s
level of knowledge, experience (as described above) and formal education.
BOARD
LEADERSHIP STRUCTURE AND BOARD’S ROLE IN RISK OVERSIGHT
The
Board of Directors does not have a policy regarding the separation of the roles of Chief Executive Officer and Chairman of the Board
of Directors as the Board believes it is in the best interests of Mexco to make that determination based on the position and director
of Mexco and the membership of the Board. At this time, the Board believes that the best leadership model for Mexco is the unitary leadership
provided by the combination of the Chairman and Chief Executive Officer positions. On September 14, 2011, the Board announced the transition
of Nicholas C. Taylor from President and Chief Executive Officer to Chairman of the Board and Chief Executive Officer and the transition
of Tammy L. McComic from Executive Vice President and Chief Financial Officer to President and Chief Financial Officer effective immediately
following the 2011 Annual Meeting.
The
Board believes that Mexco will continue to benefit from Mr. Taylor’s experience and expertise in the oil and gas industry while
Ms. McComic’s duties as President and Chief Financial Officer have been expanded. Also, in his role as Chairman, Mr. Taylor continues
to serve an important role in Mexco’s strategic direction.
We
do not have a lead independent director as we believe the oversight provided by all of the Board’s independent directors and the
work of the Board’s committees provide effective oversight of our strategic plans and operations.
Management
is responsible for defining the various risks facing the company, formulating risk management policies and procedures and managing our
risk exposure. The Board’s responsibility is to monitor the Company’s risk management processes by informing itself concerning
our material risks and evaluating whether management has reasonable controls in place to address the material risks. The Audit Committee
described below is primarily responsible for monitoring management’s responsibility in the area of risk oversight. Accordingly,
management regularly reports to the Audit Committee on risk management. The Audit Committee, in turn, reports on the matters discussed
at the committee level to the full board. The Audit Committee and the full board focus on the material risks facing the Company to assess
whether management has reasonable controls in place to address these risks.
MEETINGS
AND COMMITTEES OF THE BOARD OF DIRECTORS
During
fiscal year ended March 31, 2024, the Board of Directors consisted of one person who is an employee of the Company and five persons who
are not employees of the Company (four of which are outside directors). The Board held four meetings and all Directors, including the
Independent Directors, attended all four meetings.
The
Board of Directors established the following standing committees: audit, compensation and nominating. In accordance with Section 803A
of the NYSE American Company Guide and the Exchange Act, the Board must affirmatively determine the independence of each director. The
Board is comprised of a majority of Independent Directors and the Audit Committee, the Compensation Committee and the Nominating Committee
are comprised entirely of Independent Directors.
The
table below shows the membership of each committee of the Board and the number of meetings each committee held during the fiscal year
ended March 31, 2024.
| Director | |
Audit | | |
Compensation | | |
Nominating | |
| Michael J. Banschbach | |
| X | | |
| X
| | |
| X
| |
| Kenneth L. Clayton | |
| X | | |
| Chair | | |
| Chair | |
| Thomas R. Craddick | |
| | | |
| | | |
| | |
| Thomas H. Decker | |
| Chair
| | |
| X | | |
| X | |
| Christopher M. Schroeder | |
| | | |
| X | | |
| X | |
| Nicholas C. Taylor | |
| | | |
| | | |
| | |
| 2024 Meetings | |
| 4 | | |
| 1 | | |
| 1 | |
Audit
Committee. The Audit Committee is a standing committee of the Board of Directors and currently consists of Messrs. Decker, Chairman,
Banschbach and Clayton, all of whom are Independent Directors. The Board of Directors has determined that Mr. Decker, Chairman of the
Audit Committee, is an “audit committee financial expert” (as that term is defined under the applicable SEC rules and regulations)
based on the Board’s qualitative assessment of Mr. Decker’s level of knowledge, experience (as described above) and formal
education. The functions of the Audit Committee are to determine whether management has established internal controls which are sound,
adequate and working effectively; to ascertain whether Mexco’s assets are verified and safeguarded; to review and approve external
audits; to review audit fees and appointment of the Company’s independent public accountants; and to review non-audit services
provided by the independent public accountants. The Audit Committee held four meetings during fiscal year ended March 31, 2024. All members
of the Audit Committee attended these meetings telephonically or electronically.
The
Audit Committee operates under a written charter adopted by the Board of Directors in fiscal 2004. The charter is posted on Mexco’s
website at www.mexcoenergy.com in the “Corporate Governance” area of the “Investor Relations” section. The report
of the Audit Committee for fiscal year 2024 is included in this proxy statement on page 17.
Compensation
Committee. The Compensation Committee is a standing committee of the Board of Directors and currently consists of Messrs. Clayton,
Chairman, Banschbach, Decker and Schroeder, all of whom are Independent Directors. The primary function of the Compensation Committee
is to determine compensation for the officers of Mexco that is competitive and enables us to motivate and retain the talent needed to
lead and grow the business. The Board has determined each of the current members of the Compensation Committee satisfies the standards
of independence established by the NYSE listed requirements and SEC rules. The Compensation Committee held one meeting during the fiscal
year ended March 31, 2024. All members of the Compensation Committee attended such meeting telephonically or electronically.
The
Compensation Committee currently operates under a written charter adopted and approved by the Board of Directors as of June 15, 2005.
The charter is posted on Mexco’s website at www.mexcoenergy.com in the “Corporate Governance” area of the “Investor
Relations” section. The report of the Compensation Committee for fiscal year 2024 is included in this proxy statement on page 14.
Nominating
Committee. The Nominating Committee is a standing committee of the Board of Directors and currently consists of Messrs. Clayton,
Chairman, Banschbach, Decker and Schroeder, all of whom are Independent Directors. The Nominating Committee held one meeting during the
fiscal year ended March 31, 2024, at which all members of the Nominating Committee were present. The primary function of the Nominating
Committee is to determine the slate of Director nominees for election to the Company’s Board of Directors. The Company encourages
a diversity of backgrounds among its members; however, it does not have a formal diversity policy with regard to the consideration of
diversity in identifying director nominees. The Nominating Committee considers candidates recommended by security holders, directors,
officers and outside sources and considers criteria such as business experience, ethical standards and personal qualifications in evaluating
all such nominees. Stockholders who wish to have their nominees for election to the Board of Directors considered by the Nominating Committee
may submit such nomination to the Secretary of the Company for receipt not less than 90 days prior to the date of the next Annual Meeting
of stockholders and include (i) the name and address of the stockholder making the nomination, (ii) information regarding such nominee
as would be required to be included in the proxy statement, (iii) a representation of the stockholder, and the stockholder’s intent
to appear in person or by proxy at the meeting to propose such nomination, and (iv) the written consent of the nominee to serve as a
director if so elected.
The
Nominating Committee currently operates under a written charter adopted and approved by the Board of Directors as of June 15, 2005. The
charter is posted on Mexco’s website at www.mexcoenergy.com in the “Corporate Governance” area of the “Investor
Relations” section.
Shareholders
may request a free printed copy of any of our committee charters by contacting our Corporate Secretary at mexco@sbcglobal.net
or by calling (432) 682-1119.
COMPENSATION
COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The
Compensation Committee was formed as of June 15, 2005 and Messrs. Banschbach, Clayton, Decker and Schroeder are current members thereof.
No member of the Compensation Committee is an officer or employee of the Company. None of the Company’s executive officers served
on the Board of Directors or the Compensation Committee of any other entity, for which any officers of such other entity served either
on our Board of Directors or the Compensation Committee. The Compensation Committee makes recommendations regarding compensation subject
to approval of the entire Board of Directors.
EXECUTIVE
OFFICERS & COMPENSATION
NAMED
EXECUTIVE OFFICERS WHO ARE NOT DIRECTORS
The
Board of Directors elects executive officers annually. Executive officers hold office until their successors are elected and have qualified.
Set forth below is biographical information concerning the executive officers of Mexco. These individuals along with Nicholas C. Taylor
are referred to collectively in this Proxy Statement as the “Named Executive Officers”. Biographical information concerning
Mr. Taylor is set forth above under the caption “Mexco Energy Corporation Board of Directors.”
TAMMY
L. MCCOMIC, age 55, joined the Company in July 2001 and was elected President and Chief Financial Officer in September 2011. She
served the Company as Executive Vice President and Chief Financial Officer from 2009 to 2011 and as Vice President and Chief Financial
Officer from 2003 to 2009. Prior thereto, Ms. McComic served as Controller, Treasurer and Assistant Secretary. Ms. McComic is a Certified
Public Accountant.
DONNA
GAIL YANKO, age 79, has served as Vice President part-time since 1990. She also served as Corporate Secretary of the Company from
1992 to 2021 and from 1986 to 1992 was Assistant Secretary. From 1986 to 2015, on a part-time basis, she assisted the Chairman of the
Company in his personal business activities. Ms. Yanko also served as a director of the Company from 1990 to 2008.
STACY
D. HARDIN, age 59, joined the Company in 2006 and was elected Corporate Secretary of the Company in September 2021. She has also
served the Company as Assistant Treasurer of the Company since 2010 and from 2006 to 2021 was Assistant Secretary. Prior thereto, Ms.
Hardin served as Assistant Controller.
EXECUTIVE
COMPENSATION
The
compensation paid to the Named Executive Officers generally consists of base salaries, annual incentive bonus payments and awards under
the Stock Plans. The following table summarizes the total compensation awarded to, earned by or paid to the Named Executive Officers
during fiscal years 2024, 2023 and 2022.
Summary
Compensation Table
| Name and Principal Position | |
Year | | |
Salary (3) | | |
Bonus | | |
Option Awards (1) | | |
All Other Compensation (2) | | |
Total | |
| Nicholas C. Taylor | |
| 2024 | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | - | |
| Chairman & CEO | |
| 2023 | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | - | |
| | |
| 2022 | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | - | |
| | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Tamala L. McComic | |
| 2024 | | |
$ | 235,997 | | |
$ | 57,750 | | |
$ | 218,250 | | |
$ | - | | |
$ | 511,997 | |
| President,
CFO, Treasurer & Assistant Secretary | |
| 2023 | | |
$ | 224,445 | | |
$ | 55,000 | | |
$ | 311,000 | | |
$ | - | | |
$ | 590,445 | |
| |
| 2022 | | |
$ | 205,238 | | |
$ | 50,000 | | |
$ | 151,250 | | |
$ | - | | |
$ | 406,488 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Donna Gail Yanko | |
| 2024 | | |
$ | 1,200 | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | 1,200 | |
| Vice President | |
| 2023 | | |
$ | 1,200 | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | 1,200 | |
| | |
| 2022 | | |
$ | 1,200 | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | 1,200 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Stacy D. Hardin | |
| 2024 | | |
$ | 76,800 | | |
$ | 12,000 | | |
$ | 48,015 | | |
$ | - | | |
$ | 136,815 | |
| Secretary & Assistant Treasurer | |
| 2023 | | |
$ | 72,621 | | |
$ | 11,000 | | |
$ | 62,200 | | |
$ | - | | |
$ | 145,821 | |
| | |
| 2022 | | |
$ | 68,824 | | |
$ | 10,000 | | |
$ | 30,250 | | |
$ | - | | |
$ | 109,074 | |
| (1) | The
amounts in this column reflect the aggregate grant date fair value attributable to stock
options granted in accordance with ASC 718, “Compensation - Stock Compensation”
pursuant to the 2019 Employee Incentive Stock Plan. |
| (2) | All
other compensation is comprised of director’s fees only for Mr. Taylor. Director’s
fees are paid at the rate of $1,500 per director quarterly. Mr. Taylor waived his director’s
fee for fiscal 2024, 2023 and 2022. The sole compensation to be received by the Chairman
and CEO of the Company for such period consists of the waived director’s fees. |
| (3) | Salary
amounts for Ms. McComic and Ms. Hardin include accrued vacation not taken and sold back to
the Company as follows: fiscal 2024 includes $4,997 for Ms. McComic; fiscal 2023 includes
$6,435 for Ms. McComic; and, fiscal 2022 includes $4,388 for Ms. McComic and $1,318 for Ms.
Hardin. |
COMPENSATION
DISCUSSION AND ANALYSIS
Overview
of Compensation Program
The
Compensation Committee of the Board of Directors has responsibility for establishing, implementing and monitoring adherence to our compensation
philosophy. The Compensation Committee seeks to provide total compensation paid to our executive officers that is fair, reasonable and
competitive.
In
this compensation discussion and analysis, the “Named Executive Officers” are as follows:
| Nicholas
C. Taylor |
|
Chairman
of the Board, Chief Executive Officer |
| Tamala
L. McComic |
|
President,
Chief Financial Officer, Treasurer, Assistant Secretary |
| Donna
Gail Yanko |
|
Vice
President |
| Stacy
D. Hardin |
|
Secretary
and Assistant Treasurer |
Compensation
Philosophy and Objectives
The
Compensation Committee believes that compensation for executive officers must be competitive to enable the Company to motivate and retain
the talent needed to lead and grow the Company, reward successful performance and closely align the interests of our executives with
the Company. The ultimate objective of our compensation program is to improve stockholder value.
In
setting compensation levels, the Compensation Committee evaluates both performance and overall compensation. The review of executive
officers’ performance includes a mix of financial and non-financial measures. In addition to business results, employees are expected
to uphold a commitment to integrity, maximize the development of each individual and continue to improve the environmental quality of
the Company’s operations.
In
order to continue to attract and retain the best employees, the Compensation Committee believes the executive compensation packages provided
to the Named Executive Officers should include both cash and stock-based compensation.
The
Compensation Committee has not retained a compensation consultant to review the compensation practices of the Company’s peers or
to advise the Compensation Committee on compensation matters.
Competitive
Considerations
We
believe the competition for talented employees includes oil and gas exploration and development companies and oilfield service companies.
Many of the companies with whom we compete for top level talent are larger and have more financial resources than we do. Both our Compensation
Committee and CEO consider known information regarding the compensation practices of likely competitors when reviewing and setting the
compensation of the Named Executive Officers.
Compensation
Policies and Practices and Risk Mitigation
The
Compensation Committee periodically reviews the Company’s compensation policies and practices to ensure that they do not encourage
excessive risk-taking. The Company believes that its compensation policies and practices for all employees, including executive officers,
do not create risks that are reasonably likely to have a material adverse effect on the Company.
Role
of Chief Executive Officer in Compensation Decisions
On
an annual basis, our CEO reviews the performance of each of the other Named Executive Officers and, based on this review, makes recommendations
to the Compensation Committee with respect to the compensation of the Named Executive Officers. The CEO considers internal pay equity
issues, individual contribution and performance, competitive pressures and company performance in making his recommendations to the Compensation
Committee. The Compensation Committee may accept or adjust such recommendations.
Establishing
Executive Compensation
Consistent
with our compensation objectives, the Compensation Committee has structured our annual and long-term incentive-based executive compensation
to attract and retain the best talent, reward financial success and closely align executives’ interests with the Company’s
interests. In setting the compensation, the Compensation Committee reviews total direct compensation for the Named Executive Officers,
which includes salary, annual cash incentives and long-term equity incentives. The appropriate level and mix of incentive compensation
is not based upon a formula, but is a subjective determination made by the Compensation Committee.
We
do not have a policy of stock ownership requirements. In addition, we do not have any employment contracts or change of control agreements,
although equity issued pursuant to our Stock Plan is subject to accelerated vesting as described below in “Potential Payments Upon
a Change of Control or Termination”.
The
Compensation Committee reviews compensation matters and usually performs its annual review of officer salaries during the first quarter
of each fiscal year.
Elements
of Compensation
| Element |
|
Form
of Compensation |
|
Purpose |
| Base
Salary |
|
Cash |
|
Provide
competitive, fixed compensation to attract and retain executive talent. |
| |
|
|
|
|
| Short-Term
Incentive |
|
Cash
Bonus |
|
Create
a strong financial incentive for achieving financial success and for the competitive retention of executives. |
| |
|
|
|
|
| Long-Term
Incentive |
|
Stock
Options and Restricted Stock Grants |
|
Provide
incentives to strengthen alignment of executive team interests with Company interests, reward long-term achievement and promote executive
retention. |
| |
|
|
|
|
| Insurance
Benefits |
|
Eligibility
to participate in the plan available to our employees, including major medical, dental, life and short-term disability plans. |
|
Plan
is part of employee benefit. |
Insurance
Benefits, Defined Benefit Plans and Other Arrangements
We
offer an insurance package to all eligible employees that includes major medical, dental and life insurance. The life insurance benefit
provides for a maximum term payout of $30,000. This package also provides for a short-term disability benefit with a maximum payout of
$200 per week for a term of up to 13 weeks.
Long-term
incentive compensation for executive officers consists of only the current Employee Incentive Stock Plan. The Company does not have a
retirement or pension plan.
Potential
Payments Upon a Change in Control or Termination
The
Company does not have any employment contracts or change of control agreements. However, in the event of a change of control of the Company
or termination under certain circumstances, awards granted under the Stock Plan shall become immediately vested and fully exercisable
and shall remain exercisable until the expiration of the award or in the event the participant should die before the expiration of the
term of the award until the earlier of the expiration of the term of the award or two years following the date of the participant’s
death. Upon termination of employment, stock options held may be exercised to the extent such option was exercisable or in such accelerated
basis as the Compensation Committee may determine.
If
a change in control or termination of employment as described above were to have occurred as of March 31, 2024, 68,000 stock options
held by our Named Executive Officers would have automatically vested.
COMPENSATION
COMMITTEE REPORT
To
the Stockholders of Mexco Energy Corporation:
The
Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis, above, with management. Based on this
review and discussion, the Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis
be included in this Proxy Statement.
| July 22, 2024 |
|
Compensation Committee |
| |
|
Kenneth
L. Clayton, Chairman |
| |
|
Michael
J. Banschbach
|
| |
|
Thomas
H. Decker |
| |
|
Christopher
M. Schroeder |
EMPLOYEE
INCENTIVE STOCK PLANS
The
Company has two equity compensation plans: the 2009 Employee Incentive Stock Plan (the “2009 Plan”) and the 2019 Employee
Incentive Stock Plan (the “2019 Plan”) (collectively, the “Stock Plans”).
The
2009 Plan provided for the award of stock up to 200,000 shares and includes option awards as well as stock awards. Option awards were
granted with restrictions including payment for the shares and employment of not less than four years from the date of the award. Stock
awards were granted without restrictions and without payment by the recipient. Although shares are remaining unissued under the 2009
Plan, those unawarded shares are no longer available with the adoption of the 2019 Plan.
The
2019 Plan replaced the 2009 Plan. See information regarding material features of the 2019 Plan in Note 10, Stock-based Compensation,
to the Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended March 31, 2024 filed with the Securities
and Exchange Commission on June 27, 2024.
The
Company does not have any employment contracts or change of control agreements. However, the Stock Plan does permit accelerated vesting
of stock awards as described above in “Potential Payments Upon a Change of Control or Termination”.
The
following table summarizes certain information, as of March 31, 2024, relating to the Company’s Stock Plans. The Stock Plans were
approved by Stockholders.
| | |
Number of Shares Authorized for Issuance under Plan | | |
Number of Shares to be Issued upon Exercise of Outstanding Options | | |
Weighted Average Exercise Price of Outstanding Options | | |
Number of Shares Remaining Available for Future Issuance under Plan | |
| 2009 Plan | |
| 200,000 | | |
| 45,250 | | |
$ | 5.27 | | |
| - | |
| 2019 Plan | |
| 200,000 | | |
| 120,500 | | |
$ | 10.89 | | |
| 66,000 | |
OPTION
GRANTS FOR FISCAL 2024
The
following table summarizes certain information relating to options granted to certain Named Executive Officers and directors during the
year ended March 31, 2024.
| Name | |
# of Shares of Stock
Options Granted (1) | | |
Exercise or Base
Price per Share (2) | | |
Grant Date | | |
Grant Date Fair Value
of Options Granted (3) | |
| Tamala L. McComic | |
| 25,000 | | |
$ | 12.68 | | |
| 04/12/2023 | | |
$ | 218,250 | |
| Stacy D. Hardin | |
| 5,500 | | |
$ | 12.68 | | |
| 04/12/2023 | | |
$ | 48,015 | |
| (1) | Options
vest equally over four years, beginning with the first anniversary of the date of grant and
have a term of ten years. |
| (2) | The
exercise or base price for options granted is set as the average stock price on the date
of grant. |
| (3) | The
amounts included in this column represent the grant date fair value computed in accordance
with ASC 718. |
OPTION
EXERCISES FOR FISCAL 2024
The
following table provides information with respect to the options exercised by our Named Executive Officers and directors during fiscal
2024:
| Name | |
Number of Option Awards Acquired on Exercise | | |
Value Realized Upon Exercise (1) | |
| Thomas H. Decker | |
| 5,000 | | |
$ | 35,150 | |
| (1) | The
realized value is based on the difference between the market value of the shares purchased
on the date of exercise and the option exercise price multiplied by the number of shares
covered by the exercised option. |
OUTSTANDING
EQUITY AWARDS AT FISCAL YEAR-END 2024
The
following table sets forth certain information with respect to the vested and unvested stock options held at March 31, 2024 by each of
the Named Executive Officers and Company’s current directors.
| Name | |
# of Shares of Unexercised Options Vested | | |
# of Shares of Unexercised Options Not Vested | | |
Option Exercise Price ($/sh) | | |
Option Expiration Date | |
| Nicholas C. Taylor (1) | |
| - | | |
| - | | |
$ | - | | |
| - | |
| | |
| | | |
| | | |
| | | |
| | |
| Tamala L. McComic | |
| 9,000 | | |
| - | | |
$ | 7.00 | | |
| 08/01/2024 | |
| | |
| 25,000 | | |
| - | | |
$ | 4.84 | | |
| 09/11/2028 | |
| | |
| 25,000 | | |
| - | | |
$ | 3.34 | | |
| 03/04/2030 | |
| | |
| 12,500 | | |
| 12,500 | | |
$ | 8.51 | | |
| 07/25/2031 | |
| | |
| 6,250 | | |
| 18,750 | | |
$ | 18.05 | | |
| 08/22/2032 | |
| | |
| - | | |
| 25,000 | | |
$ | 12.68 | | |
| 04/12/2033 | |
| | |
| | | |
| | | |
| | | |
| | |
| Donna Gail Yanko (1) | |
| - | | |
| - | | |
$ | - | | |
| - | |
| | |
| | | |
| | | |
| | | |
| | |
| Stacy D. Hardin | |
| 1,250 | | |
| - | | |
$ | 4.84 | | |
| 09/11/2028 | |
| | |
| 2,500 | | |
| - | | |
$ | 3.34 | | |
| 03/04/2030 | |
| | |
| 2,500 | | |
| 2,500 | | |
$ | 8.51 | | |
| 07/25/2031 | |
| | |
| 1,250 | | |
| 3,750 | | |
$ | 18.05 | | |
| 08/22/2032 | |
| | |
| - | | |
| 5,500 | | |
$ | 12.68 | | |
| 04/12/2033 | |
| | |
| | | |
| | | |
| | | |
| | |
| Michael J. Banschbach (1) | |
| - | | |
| - | | |
$ | - | | |
| - | |
| | |
| | | |
| | | |
| | | |
| | |
| Kenneth L. Clayton (1) | |
| - | | |
| - | | |
$ | - | | |
| - | |
| | |
| | | |
| | | |
| | | |
| | |
| Thomas R. Craddick (1) | |
| - | | |
| - | | |
$ | - | | |
| - | |
| | |
| | | |
| | | |
| | | |
| | |
| Thomas H. Decker | |
| - | | |
| - | | |
$ | - | | |
| - | |
| | |
| | | |
| | | |
| | | |
| | |
| Christopher M. Schroeder | |
| 10,000 | | |
| - | | |
$ | 4.84 | | |
| 09/11/2028 | |
| (1) | At
March 31, 2024, Mr. Taylor, Ms. Yanko, Mr. Banschbach, Mr. Clayton, Mr. Craddick, and Mr.
Decker did not hold any options to purchase shares of the Company’s Common Stock. |
CERTAIN
RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
Transactions
with related persons are reviewed, approved or ratified in accordance with the policies and procedures set forth in the Company’s
Code of Ethics and Business Conduct. The Audit Committee, pursuant to the Audit Committee Charter, has the responsibility to review,
assess and approve or disapprove conflicts of interest and related-party transactions to ensure compliance with the Code.
The
Code provides that directors, officers, and employees must avoid situations that involve, or could appear to involve, “conflicts
of interest” with regard to the Company’s interest. Exceptions may only be made after review of fully disclosed information
and approval of specific or general categories by senior management (in the case of employees) or the Board of Directors (in the case
of officers or directors). Any employee, officer or director who becomes aware of a conflict or potential conflict of interest should
bring the matter to the attention of appropriate personnel. A “conflict of interest” exists when a person’s private
interest interferes in any way with the interests of the Company. Conflicts of interest generally interfere with the person’s effective
and objective performance of his or her duties or responsibilities to the Company. The Code sets forth several examples of how conflicts
of interest may arise, including when a director, officer or employee or members of their immediate family, receive improper personal
benefits because of their position with the Company; the Company gives loans to, or guarantees of obligations of directors, officers,
employees or their immediate family members; or the director, officer, employee or their immediate family members use Company property
or confidential information for personal use.
Each
year we require all our directors, nominees for director and executive officers to complete and sign a questionnaire in connection with
the solicitation of proxies for use at the Annual Meeting. The purpose of the questionnaire is to obtain information, including information
regarding transactions with related persons, for inclusion in our Proxy Statement or Annual Report.
In
addition, we annually review SEC filings made by beneficial owners of more than five percent of any class of our voting securities to
determine whether information relating to transactions with such persons needs to be included in our Proxy Statement or Annual Report.
Based
on these reviews, the Company discloses the following transaction: Our principal shareholder and Chief Executive Officer, Nicholas C.
Taylor, shares office expenditures with Mexco as disclosed in Note 11, Related Party Transactions, to the Financial Statements
included in our Annual Report on Form 10-K for the fiscal year ended March 31, 2024 filed with the SEC on June 27, 2024.
PROPOSAL
2: RATIFICATION OF THE SELECTION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The
Audit Committee has selected and the Board of Directors has approved Weaver and Tidwell, L.L.P. (“Weaver”) for appointment
as our independent registered public accounting firm for the fiscal year ending March 31, 2025, subject to ratification by the stockholders.
Neither
the Company’s bylaws nor other governing documents or law require shareholder ratification of the selection of Weaver as the Company’s
independent registered public accounting firm; however, the Company is submitting the selection of Weaver to the shareholders for ratification
as a matter of good corporate practice. If the shareholders fail to ratify the selection, the Audit Committee will reconsider whether
or not to retain that firm. Even if the selection is ratified, the Audit Committee may in its discretion direct the appointment of a
different independent registered public accounting firm at any time during the year if it determines that such a change would be in the
best interests of the Company and its shareholders.
Weaver
served as the independent registered public accountants for the Company for the fiscal year ended March 31, 2024. A representative of
Weaver may or may not be present at the Annual Meeting, but will be available by telephone, and have an opportunity to make a statement
if they desire to do so and respond to appropriate questions.
The
Company asks that you ratify the appointment of Weaver and Tidwell, L.L.P. as the Company’s independent registered public accounting
firm for the year ending March 31, 2025.
AUDIT
FEES AND SERVICES
The
table below sets forth the aggregate fees billed by Weaver and Tidwell L.L.P., the Company’s independent registered public accounting
firm for fiscal 2024 and fiscal 2023:
| | |
2024 | | |
2023 | |
| Audit fees (1) | |
$ | 138,395 | | |
$ | 132,355 | |
| Audit related fees | |
$ | - | | |
$ | - | |
| Tax service fees (2) | |
$ | 29,441 | | |
$ | 25,001 | |
| All other fees | |
$ | - | | |
$ | - | |
| Total | |
$ | 167,836 | | |
$ | 157,356 | |
| (1) | Audit
fees consist of professional services rendered for the audit of the Company’s annual
consolidated financial statements included in its Annual Report on Form 10-K, review of the
Company’s quarterly financial statement included in its Quarterly Reports on Form 10-Q
and review of the Company’s other filings with the SEC, including consents and other
research work necessary to comply with generally accepted auditing standards for the years
ended March 31, 2024 and 2023. |
| (2) | Tax
fees are for professional services rendered in connection with tax return preparation and
consultation on tax matters. |
The
Audit Committee’s policy on pre-approval of audit and audit related fees requires the Chairman of the Audit Committee to sign all
engagement letters of the principal independent accountant prior to commencement of any audit and non-audit services. All fees paid in
fiscal 2024 and 2023 were approved in accordance with these procedures. All of the work performed in auditing the Company’s consolidated
financial statements during the last two fiscal years was performed by the full-time, permanent employees of the respective independent
registered public accounting firm. The Audit Committee considers whether the services provided for non-audit services are compatible
with maintaining Weaver’s independence, and has concluded that the provision of such services by Weaver was compatible with the
maintenance of its independence in the conduct of its auditing functions.
REPORT
OF THE AUDIT COMMITTEE
To
the Stockholders of Mexco Energy Corporation:
It
is the responsibility of the members of the Audit Committee to contribute to the reliability of the Company’s financial statements.
In keeping with this goal, the Board of Directors adopted a written charter, which is posted on the Company’s website at www.mexcoenergy.com
in the “Corporate Governance” area of the “Investor Relations” section. The Audit Committee is satisfied
with the adequacy of the charter based upon its evaluation of the charter during fiscal 2024. The Audit Committee met four times during
fiscal 2024. The members of the Audit Committee are independent directors.
The
Audit Committee oversees the Company’s financial reporting process on behalf of the entire Board of Directors. Management has the
primary responsibility for the Company’s financial statements and the reporting process, including the systems of internal controls.
The primary responsibilities of the Audit Committee are to select and retain the Company’s auditors (including review and approval
of the terms of engagement and fees), to review with the auditors the Company’s financial reports (and other financial information)
provided to the SEC and the investing public, to prepare and publish this report and to assist the Board of Directors with oversight
of integrity of the Company’s financial statements; compliance by the Company with standards of business ethics and legal and regulatory
requirements; qualifications and independence of the Company’s independent auditors; and performance of the Company’s independent
auditors.
The
Audit Committee does not provide any expert or special assurance as to the Company’s financial statements or any professional certification
as to the independent auditors’ work.
In
the performance of its oversight function, the Audit Committee has reviewed and discussed the Company’s quarterly and audited financial
statements, including the quality of accounting principles with management and the independent accountants. The Audit Committee also
discussed with the independent auditors the matters required to be discussed by Rules on Auditing Standards No. 16, Communications
with Audit Committees, as amended, as adopted by the Public Company Accounting Oversight Board (“PCAOB”). Additionally,
the Audit Committee has received the written disclosures and the letter from the Company’s independent accountants required by
applicable requirements of the PCAOB regarding the independent accountants’ communications with the Audit Committee concerning
independence and the Audit Committee has discussed with the Company’s independent auditors the independent auditor’s independence.
Based
on reviews and discussions referred to above, the Audit Committee recommended to the Board of Directors that the financial statements
for fiscal 2024 be included in the Company’s Annual Report on Form 10-K for the fiscal year ended March 31, 2024 filed with the
SEC.
| July 22, 2024 |
|
Audit Committee |
| |
|
Thomas
H. Decker, Chairman |
| |
|
Michael
J. Banschbach
|
| |
|
Kenneth
L. Clayton |
The
Board of Directors recommends that you vote FOR the appointment of WEAVER AND TIDWELL, L.L.P. as the independent registered public accounting
firm for the Company for the fiscal year ending March 31, 2025.
PROPOSAL
3: ADVISORY VOTE ON EXECUTIVE COMPENSATION
This
advisory vote on executive compensation, referred to as the “say-on-pay” vote, gives shareholders the opportunity to express
their views on our Named Executive Officers’ compensation, as disclosed in this proxy statement pursuant to Item 402 of Regulation
S-K. Shareholders may vote for or against the approval of the Company’s executive compensation, or they may abstain from voting
on this proposal.
As
described in detail in our Compensation Discussion and Analysis beginning on page 12, the primary objectives in designing our executive
compensation program are to attract, retain and motivate the talent needed to lead and grow the Company, reward successful performance
and more closely align executives’ interests with those of the Company and its shareholders. The ultimate objective of our compensation
program is to improve the intrinsic value of the Company and long-term shareholder value.
We
encourage you to review the compensation tables and the narrative disclosures on compensation in this proxy statement. The Compensation
Committee and the Board of Directors believe that our executive compensation program is effective in implementing our compensation philosophy
and in achieving its goals.
The
Company requests shareholder approval of the compensation of the Company’s Named Executive Officers as disclosed pursuant to the
SEC’s compensation disclosure rules. This vote is not intended to address any specific item of compensation, but rather the overall
compensation of our Named Executive Officers and the philosophy, policies and practices described in this proxy statement. Accordingly,
we will ask our shareholders to vote “FOR” the following non-binding resolution at the Annual Meeting:
“RESOLVED,
that the shareholders approve, on an advisory basis, the compensation of the Named Executive Officers as disclosed in the Proxy Statement
of the Company for the 2024 Annual Meeting of Shareholders pursuant to the compensation disclosure rules of the Securities and Exchange
Commission.”
While
your vote on this proposal is advisory and will not be binding on the Company, the Board of Directors or the Compensation Committee,
we value the opinion of our shareholders and will take the results of this advisory vote into account when making future decisions regarding
our executive compensation program.
Our
Board of Directors unanimously recommends that you vote FOR the resolution, on an advisory basis, approving the executive compensation
of the Named Executive Officers.
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The
following table sets forth certain information regarding beneficial ownership of the Company’s Common Stock, as of July 22, 2024,
by each of the Company’s directors and executive officers, by all executive officers and directors of the Company as a group, and
by each person known to the Company to be the beneficial owner of more than 5% of any class of the Company’s outstanding Common
Stock.
| | |
Number of Shares (1) | | |
Percent of Class (2) | |
| SECURITY OWNERSHIP OF 5% HOLDERS: | |
| | | |
| | |
| Howard Cox, 15 Congress Street, Mailstop B-6, Boston, MA 02109 | |
| 202,400 | | |
| 9.71 | % |
| | |
| | | |
| | |
| SECURITY OWNERSHIP OF MANAGEMENT: | |
| | | |
| | |
| Michael J. Banschbach | |
| - | | |
| - | |
| Kenneth L. Clayton | |
| 13,000 | | |
| * | |
| Thomas R. Craddick | |
| 10,000 | | |
| * | |
| Thomas
H. Decker (3) | |
| 33,573 | | |
| 1.61 | % |
| Stacy D. Hardin | |
| 10,827 | | |
| * | |
| Tamala L. McComic | |
| 88,568 | | |
| 4.08 | % |
| Christopher M. Schroeder | |
| 10,000 | | |
| * | |
| Nicholas C. Taylor | |
| 944,000 | | |
| 45.27 | % |
| Donna Gail Yanko | |
| - | | |
| - | |
| Officers
and directors as a group (9 persons) | |
| 1,109,968 | | |
| 53.05 | % |
*
Indicates less than 1% of the outstanding shares of the Company’s Common Stock.
| (1) | Included
in the number of shares of Common Stock Beneficially Owned are shares that such persons have
the right to acquire within 60 days of the record date, July 22, 2024, pursuant to options
to purchase such Common Stock (Ms. Hardin, 9,627; Ms. McComic, 85,881; and Mr. Schroeder
10,000). |
| (2) | Securities
not outstanding, but included in the beneficial ownership of each such person, are deemed
to be outstanding for the purpose of computing the percentage of outstanding securities of
the class owned by such person, but are not deemed to be outstanding for the purpose of computing
the percentage of the class owned by any other person. |
| (3) | Includes
shares beneficially owned as follows: Mr. Decker’s spouse – 10,173. |
SECTION
16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section
16(a) of the Exchange Act requires the Company’s directors and officers and persons who own more than 10 percent of the Company’s
outstanding Common Stock, to file with the SEC initial reports of ownership and reports of changes in ownership of Common Stock held
by such persons. These persons are also required to furnish the Company with copies of all forms they file under this regulation. Based
on our records and other information, the Company believes that during the fiscal year ended March 31, 2024 all applicable Section 16(a)
filing requirements were met.
STOCKHOLDERS
PROPOSALS FOR NEXT ANNUAL MEETING
The
next Annual Meeting of the Company’s stockholders is scheduled to be held on September 9, 2025. Appropriate proposals of stockholders
intended to be presented at the 2025 Annual Meeting must be received by the Secretary of the Company at the Company’s offices at
415 West Wall, Suite 475, Midland, Texas 79701, by March 31, 2025 in order to be considered by the Board of Directors for inclusion in
the proxy solicitation materials for the 2025 Annual Meeting.
In
addition, the Company’s policy has established advance notice procedures to shareholders proposals not included in the Company’s
proxy statement, to be brought before an Annual Meeting. In general, the Secretary of the Company must receive notice of any such proposal
not less than 80 days prior to the date of the Annual Meeting (in the case of the next Annual Meeting, on or prior to June 21, 2025)
at the address of the Company’s principal executive offices above. Such notice must include the information which would be required
to be included in the proxy statement filed pursuant to the rules of the SEC had the proposal been made by the Board of Directors.
OTHER
MATTERS
We
know of no other business which will be presented at the Annual Meeting other than as explained herein. Our Board of Directors has approved
a process for collecting, organizing and delivering all stockholder communications to each of its members. To contact all directors on
the Board, all directors on a Board committee or an individual member or members of the Board of Directors, a stockholder may mail a
written communication to: Mexco Energy Corporation, Attention: Corporate Secretary, P.O. Box 10502, Midland, Texas 79702. All communications
received in the mail will be opened by the Company’s Corporate Secretary for the purpose of determining whether the contents represent
a message to the Board of Directors. The contents of stockholder communications to the Board of Directors will be promptly relayed to
the appropriate members. The Company encourages all members of the Board of Directors to attend the Annual Meeting of stockholders although
we have no formal policy requiring attendance.
On
June 27, 2024, we filed with the SEC an Annual Report on Form 10-K for the fiscal year ended March 31, 2024. The Annual Report on Form
10-K has been provided concurrently with this Proxy Statement to all stockholders entitled to notice of, and to vote at, the Annual Meeting.
You
can learn more about the Company and our operations by visiting our website at www.mexcoenergy.com. Our website contains information
concerning our business, recent news releases and other filings with the SEC; our Code of Business Conduct and Ethics; the charters of
the Audit Committee, Compensation Committee and Nominating Committee; and, information concerning our Board of Directors and stockholder
relations.
| |
BY
ORDER OF THE BOARD OF DIRECTORS |
| |
|
| |
Stacy
D. Hardin, Secretary |
Mexco Energy (AMEX:MXC)
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