UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
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))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to (S) 240.14a-11(c) or (S) 240.14a-12
ULTRA PETROLEUM CORPORATION
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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Notes:
Reg. (S) 240.14a-101.
SEC 1913 (3-99)
ULTRA PETROLEUM CORP.
16801 Greenspoint Park Drive, Suite 370
Houston, Texas 77060
Notice of Annual Meeting of Shareholders
to be held on June 12, 2001
NOTICE IS HEREBY GIVEN that the Annual Meeting (the "Meeting") of the
shareholders of Ultra Petroleum Corp. ("Ultra" or the "Corporation") will be
held at The Houston Marriott North Hotel at Greenspoint, 255 N. Sam Houston
Parkway East, Houston Texas, on Tuesday, the 12th day of June, 2001 at 10:00
o'clock in the morning (Houston time) for the following purposes:
1. To receive the financial statements of the Corporation for the year ended
December 31, 2000, together with the auditors' report thereon;
2. To elect the board of directors of the Corporation;
3. To reappoint KPMG LLP as the independent auditor of the Corporation for the
fiscal year ending December 31, 2001 and to authorize the directors to fix
the auditors' remuneration; and
4. To transact such other business as may properly be brought before the
Meeting or any adjournment thereof.
The specific details of the matters proposed to be put before the Meeting
are set forth in the Proxy Statement accompanying and forming part of this
Notice.
Shareholders of Ultra are requested to date and sign the enclosed Proxy
even if you plan to attend the meeting and mail it to or deposit with the
Corporation's transfer agent, Computershare Trust Company of Canada, 4th Floor,
510 Burrard Street, Vancouver, British Columbia, V6C 3B9. In order to be valid
and acted upon at the meeting, forms of proxy must be received at the aforesaid
address by 9:00 o'clock in the morning on June 8, 2001.
The Board of Directors of Ultra has fixed the record date for the Meeting
at the close of business on May 3, 2001 (the "Record Date"). Only shareholders
of Ultra of record as at that date are entitled to receive notice of the
Meeting. Shareholders of record will be entitled to vote those shares owned by
them as of the Record Date.
BY ORDER OF THE BOARD OF DIRECTORS
Michael D. Watford
Chief Executive Officer
April 27, 2001
ULTRA PETROLEUM CORP.
MANAGEMENT PROXY CIRCULAR
This information is given as of April 27, 2001
GENERAL INFORMATION
-------------------
SOLICITATION OF PROXIES
This Management Proxy Circular is furnished in connection with the solicitation
of proxies by the management of ULTRA PETROLEUM CORP. (the "Corporation") for
use at the Annual Meeting (the "Meeting") of the shareholders of the
Corporation, to be held at the time and place and for the purposes set forth in
the accompanying Notice of Meeting and at any adjournment thereof.
The contents and the sending of this Management Proxy Circular have been
approved by the Directors of the Corporation.
Persons or Companies Making The Solicitation
--------------------------------------------
The enclosed instrument of proxy is solicited by management. Solicitations will
be made by mail and possibly supplemented by telephone or other personal contact
to be made without special compensation by regular officers and employees of the
Corporation. The Corporation may reimburse shareholders' nominees or agents
(including brokers holding shares on behalf of clients) for the cost incurred in
obtaining authorization from their principals to execute the instrument of
proxy. No solicitation will be made by specifically engaged employees or
soliciting agents. The cost of solicitation of proxies by management will be
borne by the Corporation. None of the directors of the Corporation have advised
management in writing that they intend to oppose any action intended to be taken
by management as set forth in this Management Proxy Circular.
Appointment and Revocation of Proxies
-------------------------------------
The persons named in the accompanying instrument of proxy are directors or
officers of the Corporation. A shareholder has the right to appoint a person to
attend and act for him on his behalf at the Meeting other than the persons named
in the enclosed instrument of proxy. To exercise this right, a shareholder shall
strike out the names of the persons named in the instrument of proxy and insert
the name of his nominee in the blank space provided, or complete another
instrument of proxy.
The completed instrument of proxy must be dated and signed and the duly
completed instrument of proxy must be deposited at the Corporation's transfer
agent, Computershare Trust Company of Canada, 4th Floor, 510 Burrard Street,
Vancouver, British Columbia, V6C 3B9, at least 48 hours before the time of the
Meeting or any adjournment thereof, excluding Saturdays, Sundays and holidays.
The instrument of proxy must be signed by the shareholder or by his duly
authorized attorney. If signed by a duly authorized attorney, the instrument of
proxy must be accompanied by the original power of attorney or a notarially
certified copy thereof. If the shareholder is a corporation, the instrument of
proxy must be signed by a duly authorized attorney, officer, or corporate
representative, and must be accompanied by the original power of attorney or
document whereby the duly authorized officer or corporate representative derives
his power, as the case may be, or a notarially certified copy thereof.
The Chairman of the Meeting has discretionary authority to accept proxies, which
do not strictly conform to the foregoing requirements.
1
In addition to revocation in any other manner permitted by law, a shareholder
may revoke a proxy either by (a) signing a proxy bearing a later date and
depositing it at the place and within the time aforesaid, or (b) signing and
dating a written notice of revocation (in the same manner as the instrument of
proxy is required to be executed as set out in the notes to the instrument of
proxy) and depositing it either at the place and within the time aforesaid or
with the Chairman of the Meeting on the day of the Meeting or on the day of any
adjournment thereof, or (c) registering with the scrutineer at the Meeting as a
shareholder present in person, whereupon such proxy shall be deemed to have been
revoked.
Voting of Shares and Exercise of Discretion of Proxies
------------------------------------------------------
On any poll, the persons named in the enclosed instrument of proxy will vote the
shares in respect of which they are appointed and, where directions are given by
the shareholder in respect of voting for or against any resolution, will do so
in accordance with such direction.
In the absence of any direction in the enclosed instrument of proxy, it is
intended that such shares will be voted in favor of each of the proposals
referred to in the instrument of proxy. The enclosed instrument of proxy, when
properly signed, confers discretionary authority with respect to amendments or
variations to any matters, which may properly be brought before the Meeting. At
the date of this Management Proxy Circular, management of the Corporation is not
aware of any such amendments, variations or other matters to be presented for
action at the Meeting. However, if any other matters which are not now known to
the management should properly come before the Meeting, the proxies hereby
solicited will be voted on such matters in accordance with the best judgement of
the nominee.
Voting of Common Shares - Advice to Beneficial Holders of Securities
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The information set forth in this section is of significant importance to many
shareholders, as a substantial number of the shareholders do not hold common
shares in their own name. Shareholders who do not hold their common shares in
their own name (referred to in this Management Proxy Circular as "Beneficial
Shareholders") should note that only proxies deposited by shareholders whose
names appear on the records of the Corporation as the registered holders of
common shares can be recognized and acted upon at the Meeting. If common shares
are listed in an account statement provided to a shareholder by a broker, then
in almost all cases those shares will not be registered in the Beneficial
Shareholder's name on the records of the Corporation. Such shares will more
likely be registered under the name of the Beneficial Shareholder's broker or an
agent of that broker. Shares held by brokers or their nominees can only be
voted (for or against resolutions) upon the instructions of the Beneficial
Shareholder. Without specific instructions, brokers and nominees are generally
prohibited from voting shares for their clients.
Applicable regulatory policy requires intermediaries and brokers to seek voting
instructions from Beneficial Shareholders in advance of shareholders' meetings.
Every intermediary and broker has its own mailing procedures and provides its
own return instructions, which should be carefully followed by Beneficial
Shareholders in order to ensure that their common shares are voted at the
Meeting. Often, the form of proxy supplied to a Beneficial Shareholder by its
broker is identical to the form of proxy provided to registered shareholders;
however, its purpose is limited to instructing the registered shareholder how to
vote on behalf of the Beneficial Shareholder. The majority of brokers now
delegate responsibility for obtaining instructions from clients to Independent
Investor Communications Corporation ("IICC") in Canada and ADP Investor
Communication Services ("ADP") in the United Sates. IICC and ADP typically
apply a special sticker to the proxy forms, mail those forms to the Beneficial
Shareholders and ask Beneficial Shareholders to return the proxy forms to IICC
for Canada and ADP for the United States. IICC and ADP then tabulate the
results of all instructions received and provide appropriate instructions
respecting the voting of shares to be represented at the Meeting. A Beneficial
Shareholder receiving a proxy with an IICC or ADP sticker on it cannot use that
proxy to vote shares directly at the Meeting, rather the proxy must be returned
to IICC or ADP well in advance of the Meeting in order to have the shares voted.
2
VOTING SHARES AND PRINCIPAL HOLDERS THEREOF
On May 3, 2001, 72,776,418 Common Shares without par value were issued and
outstanding, each share carrying the right to one vote. At a general meeting of
the Corporation, on a show of hands, every shareholder present in person shall
have one vote and, on a poll, every shareholder shall have one vote for each
share of which he is the holder.
Only shareholders of record at the close of business on the 3rd day of May,
2001, who either personally attend the Meeting or who complete and deliver an
instrument of proxy in the manner and subject to the provisions set out under
the heading "Appointment and Revocation of Proxies", will be entitled to have
his or her shares voted at the Meeting or any adjournment thereof.
To the knowledge of the directors and senior officers of the Corporation, only
the following own, directly or indirectly, or exercise control or direction
over, shares carrying more than l0% of the voting rights attached to all
outstanding shares of the Corporation:
PERCENTAGE OF
ISSUED AND
OUTSTANDING VOTING
NAME OF SHAREHOLDER NUMBER OF SHARES SECURITIES
--------------------------------------------------------------------------------
Ultra Holdings, Inc. 13,230,600 18.2%
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Statement of Executive Compensation
-----------------------------------
Executive Officers of Ultra
For the purposes of this Proxy Circular:
"CEO" of Ultra means an individual who served as Chief Executive Officer of
Ultra or acted in a similar capacity during the most recently completed
financial year;
"executive officer" of Ultra means an individual who at any time during the most
recently completed financial year was the Chairman or Vice-Chairman of the
Board, where that person performed the function of such office on a full-time
basis, the President, a Vice-President in charge of a principal business unit
such as sales, finance or production, and any officer of Ultra or any of its
subsidiaries who performed a policy-making function in respect of Ultra whether
or not the individual was also a director of Ultra or any of its subsidiaries;
and
"Named Executive Officers" means:
(a) each CEO regardless of the amount of his compensation;
(b) each of Ultra's four most highly compensated executive officers, other
than the CEO, who were serving as executive officers at the end of the
most recently completed financial year and had total salary and
bonuses of at least Cdn$100,000; and
(c) any person who would be included under paragraph (b) but for the fact
that he was not serving as an executive officer at the end of the most
recently completed financial year.
3
Summary Compensation Table
The following table, presented in accordance with Form 40 of the Regulation made
under the Securities Act (Ontario) (the "Regulation"), sets forth all annual and
long-term compensation for services rendered in all capacities to Ultra (on a
consolidated basis) for the 12 month period ended December 31, 2000, the six
month fiscal period ended December 31, 1999, and for the fiscal year ended June
30, 1999. Ultra had no other executive officers whose total salary and bonuses
(on an annualized basis) exceeded Cdn$100,000 during the fiscal period ended
December 31, 2000 and the six-month fiscal period ended December 31, 1999 and
the fiscal year-end June 30, 1999.
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Annual Compensation Long-Term Compensation
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Awards
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Restricted
Securities Under Shares or
Name and Period Options/SARs Restricted All Other
Principal Position Ending Salary Bonus Granted Share Units Compensation
(US$) (US$) (#) (#) (US$)
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Michael D. Watford Dec, 31, 2000 $ 240,000 $ 240,000 $ 250,000 $ 125,000 Nil
Chairman of the Board, CEO Dec, 31, 2000 $ 240,000/(1)/ $ 120,000 $ Nil $ Nil $ 80,000
& President June 30, 1999 240,000 Nil $ 1,650,00 $ 412,000 Nil
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Charlotte Kauffman Dec. 31, 2000 $ 100,000 $ 75,000 $ 100,000 $ 50,000 Nil
Corporate Secretary and Dec. 31, 1999 $ 100,000/(1)/ $ 20,000 $ 150,000 Nil Nil
General Counsel June 30, 1999 $ 100,000 Nil Nil Nil Nil
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Stephen Kneller Dec. 31, 2000 $ 99,000 $ 90,000 $ 100,000 $ 50,000 Nil
VP Exploration Dec. 31, 2000 $ 99,000/(1)/ $ 9,900 $ 150,000 Nil Nil
June 30, 1999 $ 99,000 $ Nil Nil Nil Nil
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(1) This represents an annual salary, even though the reporting period is six
months.
Compensation of Directors
Directors who are not officers of Ultra are not currently paid any fees for
their services as directors other than expenses for travel to the board
meetings. During the year ended December 31, 2000 no compensation was paid or
payable to directors or entities controlled by directors except for compensation
paid to the Named Executive Officers as described above. Directors are also
entitled to participate in Ultra's 2000 Stock Incentive Plan, and are entitled
to automatic awards of options thereunder. As of December 31, 2000, options in
respect of an aggregate of 320,000 Common Shares were outstanding in favor of
current directors who are not officers of Ultra.
Long-term Incentive Plan ("LTIP") Awards
No LTIP awards were made to a Named Executive Officer during the most recently
completed financial year.
4
Options and Stock Appreciation Rights ("SARs")
----------------------------------------------
Option/SAR Grants During the Most Recently Completed Financial Year
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% of Total Market Value of
Options/SARs Securities Un- Expiration
Securities Under Granted to derlying Date
Options/SARs Employees in Exercise or Base Options/SARs on
Name Granted Financial Year Price the Date of Grant
(#) (Cdn$/Security) (Cdn$/Security)
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Michael D. Watford 250,000 20.4% $0.81 $0.81 3/24/10
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Charlotte Kauffman 100,000 8.2% $1.79 $1.79 6/05/10
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Stephen Kneller 100,000 8.2% $1.79 $1.79 6/05/10
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(1) Exercise price is based on the previous day's closing price on the TSE.
Aggregated Option/SAR Exercises During The Most Recently Completed Financial
Year And Financial Year-End Option/SAR Values
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Unexercised Value of Unexercised
Options/SARs at in-the-Money Options/SARs at
Dec 31, 2000 Dec 31, 2000/(1)/
Securities Acquired Aggregate Value
on Exercise Realized Exercisable/ Exercisable/
Name Unexercisable Unexercisable
(#) (US$) (#) (US$)
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Michael D. Watford Nil N/A 1,362,500/537,500 3,637,875/1,435,125
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Charlotte Kauffman Nil N/A 200,000 /50,000 534,000/133,500
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Stephen Kneller Nil N/A 200,000/ 50,000 534,000/133,500
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(1) The closing price of the Ultra Shares on December 31, 2000 was US$2.67.
Change in Responsibilities and Employment Contracts
Ultra has an employment contract with Michael D. Watford, the Chairman, Chief
Executive Officer and President. The contract provides for an initial term of
three years commencing January 29, 1999 that will be automatically extended for
successive one-year periods with a ninety day written notice for early
termination. Ultra's Compensation Committee will annually review Mr. Watford's
compensation and will recommend to the Board of Directors for approval the
appropriate adjustments, if any. Such adjustments shall be based on performance
and then current market conditions for comparable positions. An annual incentive
award is recommended by the Compensation Committee and approved by the Board.
Mr. Watford received stock options for common stock of Ultra, with an expiration
period of ten years. The options will be vested over two years from January 29,
1999. The vesting will occur in four
5
equal parts at six-month intervals. The contract also provides for a retention
bonus of $250,000 for continued employment of two years. Subsequent to December
31, 1999, the board of directors of Ultra determined that in lieu of payment of
such retention bonus, Ultra would issue Mr. Watford 471,698 Ultra Shares as
performance shares pursuant to Ultra's 2000 Stock Incentive Plan, provided that
Mr. Watford continues to be employed by Ultra as of January 29, 2001. In the
event Mr. Watford is terminated prior to the end of his contract other than for
just cause, a severance package comprising 50% of Mr. Watford's salary would be
paid. Should Mr. Watford be terminated due to sale or merger of Ultra, 100% of
his salary would be paid. The stock options at termination would vest according
to the following schedule: (a) prior to six months of employment, he would
receive one-fourth of the options; (b) for six months to a year of employment,
he would receive the proportionate number of options equivalent to the number of
months employed divided by 24 months; and (c) after one year, he would receive
all the options.
Report on Executive Compensation
The compensation policy of Ultra for determining executive compensation is
performance based and focuses on management's fundamental objective of
maximizing long term shareholder value. The compensation practices are comprised
of several components such as base salary and incentives which relate to
specific accomplishments during the year which may be paid in cash and/or long
term equity-based incentives in the form of stock options. To date, no specific
formulae have been developed to assign specific weighting to each of these
components. Ultra's compensation philosophy is to foster entrepreneurship at all
levels of the organization by generating long term equity-based incentives,
through the granting of stock options, which is a significant component of
executive compensation assuming Ultra's Common Share price achieves good long
term performance. The Compensation Committee uses third party compensation data
to assist with salary determinations and to assist in assessing competitiveness.
The Compensation Committee considers the amount and terms of outstanding options
when determining whether and how many new option grants are to be made.
Base Salary
The Compensation Committee reviews and approves the salary ranges for Ultra's
employees. Comparative data is accumulated from a number of external sources
including independent consultants. The policy for determining salary for
executive officers is consistent with the administration of salaries for all
other employees. Base salaries for executives are determined by assessment of
sustained performances and consideration of competitive compensation levels for
the markets in which Ultra operates.
Long Term Compensation
Ultra has a broad-based employee stock option plan. The plan is designed to
encourage stock ownership and entrepreneurship on the part of all employees and,
in particular, all executive officers. The plan aligns the interests of
executive officers with shareholders by linking a significant component of
executive compensation to the long-term performance of Ultra Shares. Individual
grants are determined by an assessment of an individual's current and expected
future performance, level of responsibilities and the importance of his/her
position with, and contribution to, Ultra. The executive officers who are most
involved in the evolution of Ultra, be it through property acquisition,
promotion or compliance, are the officers who are prioritized in terms of
compensation. As such, Michael D. Watford is the officer who receives the
greatest amount of compensation in terms of salary and option packages.
6
Performance Graph
-----------------
The following graph compares the yearly percentage change in the Corporation's
cumulative total shareholder return on its Common Shares with the cumulative
total return of the Toronto Stock Exchange 300 Composite Index. For this
purpose, the yearly percentage change in the Corporation's cumulative total
shareholder return is calculated by dividing the difference between the price
for the Corporation's shares at the end and the beginning of the "measurement
period" by the price for the Corporation's Common Shares at the beginning of the
measurement period. "Measurement period" means the period beginning at the
market close on the last trading day before the beginning of the Corporation's
fifth preceding financial year, through and including the end of the
Corporation's most recently completed financial year.
[GRAPH]
12/31/95 12/31/96 12/31/97 12/31/98 12/31/99 12/31/00
--------------------------------------------------------------------------------
Ultra 100 736 1539 403 258 1055
TSE 300 100 126 142 137 178 189
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CORPORATE GOVERNANCE
Statement of Corporate Governance Practices
-------------------------------------------
This statement of corporate governance practices is made pursuant to the
policies and guidelines (the "Guidelines") of the TSE. The Guidelines address
matters such as the constitution and independence of corporate boards, the
functions to be performed by boards and their committees, and the effectiveness
and education of board members.
The Corporation's board of directors and senior management considers effective
corporate governance to be central to the proper operation of the Corporation
and the interests of its shareholders and other stakeholders. This disclosure
statement has been prepared by the Corporate Governance Committee of the board
and has been approved by the board of directors.
Mandate of the Board
--------------------
The board of directors has explicitly acknowledged responsibility for the
management of the business and affairs of, and to act with a view to the best
interests of, the Corporation. The mandate of the board to deal with this
responsibility is expressed to include, among other matters:
(a) the adoption of a strategic planning process;
7
(b) the identification on a regular basis of the principal risks of the
Corporation's business and the establishment of appropriate systems to
manage these risks;
(c) the assessment of management performance, considering succession
planning, and taking responsibility for appointing, training and
monitoring senior management;
(d) establishing a policy to facilitate communications with shareholders
and others involved with the Corporation;
(e) addressing the integrity of the Corporation's internal control and
management information systems; and
(f) considering, from time to time, matters that pertain to the
Corporation operating in a foreign country or countries.
Board Composition and Independence from Management
--------------------------------------------------
The board believes that three of the four current directors and three of the
five nominated directors are "unrelated directors" and that the remainder may be
considered to be "related directors" within the meaning of the Guidelines. An
"unrelated director" under the Guidelines is a director who is independent of
management and free from any interest, business or other relationship which
could, or could reasonably be perceived to, materially interfere with the
director's ability to act other than interests arising from shareholding. In
defining an "unrelated director", the Guidelines place emphasis on the ability
of a director to exercise objective judgement.
In deciding whether a particular director was a "related director" or an
"unrelated director" for purposes of the Guidelines, the board of directors
examined the factual circumstances of each director and considered them in the
context of other relevant factors. Its determination was made based solely with
regard to the language of the Guidelines. The board also concluded that no
director would be unable to be sensitive to potential conflicts of interest, to
act objectively and to perform his duties in the best interests of the
Corporation.
The board has considered the Guidelines' recommendations regarding additional
structures or procedures to ensure the board of directors' independence from
management and concluded that the existing state was sufficient. All directors
are expected to exercise prudent business judgement at all times.
Mr. Watford serves as Chairman of the Board of Directors. The TSE Report states
that the independence of a board is most simply assured by appointing a Chair
who is not a member of management. The Board has considered the issue of an
independent chair of the Board. In light of Mr. Watford's guidance in the
successful development of the business of the Corporation, the Board considers
him uniquely suited to fulfil the role of Chair at meetings of the Board of
Directors.
The board has encouraged management to identify opportunities for the
Corporation and expects to assess and respond to risks associated in cooperation
with management. These expectations have been met to date.
Decisions Requiring Board Approval
----------------------------------
The board of directors does not have a formal policy setting out which matters
must be brought by management to the board for approval. There is a clear
understanding between management and the board that all transactions and other
matters of a material nature should be presented for consideration and, if
appropriate, approval by the board, including the hiring or termination of any
member of senior management. It is recognized that, from time to time, it may
be appropriate for an individual director, or
8
group of them, to engage an outside advisor at the expense of the Corporation.
Such engagement would be subject to the approval of the board of directors.
Board Committees
----------------
The board of directors has four committees: the Audit Committee, the
Compensation Committee, the Nominating Committee and the Corporate Governance
Committee. The committees and their mandates are outlined below:
(i) Audit Committee: The Audit Committee is responsible for reviewing
the scope and audit plan of the independent auditors' examinations
of the Corporation's financial statements and receiving and
reviewing the reports of the independent auditor. The Audit
Committee also meets with the independent auditor, conducts internal
audits and investigations, receives recommendations or suggestions
for changes in accounting procedures and initiates or supervises any
special investigations it may choose to undertake. The Audit
Committee is comprised of Messrs. Nielson, Roe and Helton with Mr.
Nielson acting as Chairman.
(ii) Compensation Committee: The Compensation Committee is comprised of
Messrs. Roe, Watford and Nielson, with Mr. Roe acting as its
Chairman. The Compensation Committee makes recommendations to the
Corporation's board of directors with respect to the nature and
amount of all compensation of the Corporation's officers, including
recommendations on the Corporation's 2000 Stock Incentive Plan.
(iii) Nominating Committee: The Nominating Committee of the Corporation is
comprised of Messrs. Helton, Nielson and Watford, with Mr. Helton
acting as its Chairman. This committee determines nominees to the
Board of Directors.
(iv) Corporate Governance Committee: The Corporate Governance Committee
is comprised of Messrs. Roe, Nielson and Helton, with Mr. Roe acting
as Chairman. The Corporate Governance Committee is responsible for
reviewing and determining corporate governance duties and procedures
and, where necessary, making recommendations to the board of
directors on changes to corporate governance policies and
procedures.
Shareholder Relations and Feedback
----------------------------------
All inquiries from shareholders and the investment community are referred
initially to the Corporation's Chief Executive Officer, who ensures that the
Corporation provides a satisfactory reply to the inquiry. The Corporation
believes that its communications are sufficient and responsive.
PARTICULARS OF MATTERS TO BE ACTED UPON
---------------------------------------
ELECTION OF DIRECTORS
Each director of the Corporation is elected annually and holds office until the
next Annual Meeting of the shareholders unless that person ceases to be a
director before then. In the absence of instructions to the contrary, the shares
represented by the enclosed instrument of proxy will, on a poll, be voted for
the nominees herein listed. Management does not contemplate that any of the
nominees set out below will be unable to serve as a director.
The following table sets out the names of the persons proposed by management to
be nominated for election as directors, the positions and offices which they
presently hold with the Corporation, their respective principal occupations and
the number of shares of the Corporation which each beneficially owns, directly
or indirectly, or over which control or direction is exercised as of the date of
this Management Proxy Circular:
9
===============================================================================================================
Common Shares
Beneficially
Owned or
Name and Position Principal Occupation Director Since Controlled
---------------------------------------------------------------------------------------------------------------
MICHAEL D. WATFORD Former President, CEO and Director January 29, 1999 661,101
Chairman of the Board, of Nuevo Energy Co., a public
CEO & Director resource company; Consultant in
private business until Feb. 1999;
Chairman of the Board, Chief
Executive Officer and President of
the Corporation.
---------------------------------------------------------------------------------------------------------------
DR. WILLIAM C. HELTON Medical Doctor; President of August 12, 1994 378,329
Director Enterprise Exploration & Production
Inc., a private oil and gas
exploration and development company.
---------------------------------------------------------------------------------------------------------------
JAMES NIELSON Former Director, CEO and President February 1, 2001 30,000
Director of Husky Oil until 1979. Mr.
Nielson formed JN Oil and Gas, a
privately owned oil and gas
exploration company of which he was
President and CEO until the sale of
the company in 1992. For the past
nine years Mr. Nielson has headed
Nielson & Associates of Cody,
Wyoming, an independent oil and gas
firm.
----------------------------------------------------------------------------------------------------------------
JAMES C. ROE Former board member of Pendaries January 16, 2001 212,472
Director Petroleum Ltd. and a current board
member of the Corporation. Mr. Roe
was Vice President/Owner of Delta-X
Corp., a high technology automation
system used in oil producing
operations. Mr. Roe has been
retired since the sale of Delta-X
Corp. in 1992.
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ROBERT E. RIGNEY Mr. Rigney was the CEO and Chairman 800,174
of Pendaries Petroleum Ltd. since --
its inception in 1996. Mr. Rigney
has been a diplomat, oil company
executive and consultant in Asia for
over 21 years and is currently a
consultant to the Corporation.
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The information as to shares beneficially owned or over which the above-named
officers and directors exercise control or direction not being within the
knowledge of the Corporation has been furnished by the respective officers and
directors individually.
APPOINTMENT OF AUDITOR
The Board of Directors of the Corporation is recommending the re-appointment
of KPMG LLP, Chartered Accountants, to act as the Corporation's auditor in
respect of the year ending December 31, 2001. KPMG LLP is the successor firm
to KPMG Peat Marwick, Chartered Accountants, which firm was first appointed as
the Corporation's auditor at the meeting of the shareholders held on December
19, 1996. At the meeting, shareholders will be asked to consider and, if
thought fit, approve the re-appointment of KPMG LLP as auditor of the
Corporation for the ensuing year. Unless such authority is withheld, the
persons named in the accompanying proxy intend to vote for the appointment of
KPMG LLP, Chartered Accountants, as auditor of the Corporation, and to
authorize the directors to fix their remuneration.
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OTHER BUSINESS TO BE CONDUCTED AT THE MEETING
Receipt of the Consolidated Financial Statements and Auditors' Report
---------------------------------------------------------------------
At the Meeting, shareholders will receive and consider the consolidated
financial statements of Ultra for the year ended December 31, 2000 and the
auditors' report thereon, but no vote by the shareholders with respect thereto
is required or proposed to be taken.
OTHER MATTERS
Management knows of no amendment or other matters to come before the Meeting
other than the matters referred to in the Notice of Annual Meeting. However, if
any other matter properly comes before the Meeting, the accompanying proxy will
be voted on such matter at the discretion of the person or persons voting the
proxy.
All information contained in this Proxy Statement relating to the occupations,
affiliations and securities holdings of directors and officers of the
Corporation and their relationship and transactions with the Corporation is
based upon information received from the individual directors and officers.
THE CORPORATION HAS PROVIDED TO EACH PERSON WHOSE PROXY IS SOLICITED HEREBY A
COPY OF THE CORPORATION'S 2000 ANNUAL REPORT WHICH INCLUDES A COPY OF ITS
CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED DECEMBER 31, 2000.
BY ORDER OF THE BOARD OF DIRECTORS
Michael D. Watford
Chief Executive Officer
Houston, Texas
April 27, 2001
11