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

Filed by the Registrant  x                             Filed by a Party other than the Registrant  ¨

Check the appropriate box:

PRIMEENERGY CORPORATION

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement,proxy statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS OF

PrimeEnergy Corporation

TO BE HELD

May 20, 201510, 2016

Notice is hereby given that the Annual Meeting of Stockholders of PrimeEnergy Corporation (the “Company”) will be held on Wednesday,Tuesday, May 20, 2015,10, 2016, at 9:00 a.m., EDT, at the offices of the Company, One Landmark Square, 11th Floor, Stamford, Connecticut 06901, for the following purposes:

1. To elect a Board of Directors of seven (7) persons as nominated in the accompanying Proxy Statement,proxy statement, such Directors to hold office until the next annual meeting of stockholders and until their successors are elected;

2. An advisory (non-binding) vote to approve our executive compensation as described in the accompanying proxy statement; and

3. To transact such other procedural business as may properly be brought before the Meeting or at any adjournment or adjournments thereof.

The Meeting may be adjourned from time to time without other notice than by announcement at the Meeting, or at any adjournment thereof, and any and all business for which the Meeting is hereby noticed may be transacted at any such adjournment.

The Board of Directors has fixed April 14, 2015,5, 2016, as the date for the taking of a record of the stockholders entitled to notice of and to vote at the Meeting and at any adjournment or adjournments thereof. The stock transfer books will not be closed.

Enclosed is a form of proxy solicited by the Board of Directors of the Company. Stockholders who do not plan to attend the Meeting in person are requested to date, sign and return the enclosed proxy in the enclosed envelope, to which no postage need be affixed if mailed in the United States. Your proxy may be revoked at any time before it is exercised and will not be used if you attend the Meeting and prefer to vote in person.

April 22, 20152016

Important Notice Regarding Internet Availability of

Proxy Materials for the Annual Meeting of Stockholders

to be held on May 20, 201510, 2016

The proxy material for this Annual Meeting and the Company’s 20142015 Annual Report

to Stockholders are available at www.RRDEZProxy.com/2015/PrimeEnergyCorporationwww.proxydocs.com/PNRG

PROXY STATEMENT

TABLE OF CONTENTS

PrimeEnergy Corporation

9821 Katy Freeway

Houston, Texas 77024

PROXY STATEMENT

Solicitation by the Board of Directors of Proxies from

Stockholders for Annual Meeting of Stockholders

May  20, 201510, 2016

GENERAL INFORMATION

The Board of Directors of PrimeEnergy Corporation, a Delaware corporation, (hereinafter called the “Company”) solicits your proxy in the enclosed form which, if you do not plan to attend the Annual Meeting of Stockholders of the Company on Wednesday,Tuesday, May 20, 2015,10, 2016, you are requested to fill out, sign as indicated and return to the Company in the enclosed self-addressed envelope, which requires no postage if mailed in the United States. Any proxy given pursuant to this solicitation may be revoked by the person giving it at any time before it is exercised by notice (i) in person by the stockholder’s oral revocation at the Annual Meeting or (2) in writing to the Company at One Landmark Square, Stamford, Connecticut 06901 (Attention: Corporate Secretary), if the proxy was executed and returned. The approximate date on which the proxy statement and form of proxy will be sent to security holders is April 22, 2015.2016.

Proxies are being solicited by mail and all expenses of solicitation have been or will be borne by the Company. In addition, arrangements may be made with brokerage houses and other custodians, nominees and fiduciaries to send proxies and proxy materials to their principals and the Company will reimburse them for their expenses in so doing.

Only stockholders of record at the close of business on April 14, 20155, 2016 (the “Record Date”), are entitled to vote at the 20152016 Annual Meeting and any adjournment thereof. There were 2,316,3442,294,553 shares of common stock (“Common Stock”) outstanding on the Record Date. Each holder of Common Stock is entitled to vote on the proposalproposals presented in this Proxy Statementproxy statement for each share held, each share entitling the record holder thereof to one vote.

Matters to be Voted on at the Annual Meeting

The only matterThere are two (2) proposals that isare scheduled to be voted on at the Annual Meeting isMeeting. Stockholders are being asked to vote on (1) the election of seven (7) Directors named herein to the Board of Directors of the Company.Company; and (2) an advisory (non-binding) vote to approve the executive compensation paid as described in this proxy statement.

Vote Required

All shares of the Company represented by proxies received in time and in proper form and condition and not revoked will be voted as specified in the proxy; or in the absence of specific direction, the proxy will be voted by the person designated therein:

FOR the election as Directors of the Company of the seven (7) nominees named herein, to hold office until the next annual meeting of stockholders and until their respective successors shall be duly elected.elected; and

FOR the approval of executive compensation.

In the event any of the nominees should become unable to serve as a Director, it is intended that, pursuant to the accompanying form of proxy, votes will be cast for a substitute nominee designated by the Board of Directors.

The election of Directors will require the affirmative votes of a plurality of the shares of the Common Stock voting in person or by proxy at the Annual Meeting. The Company’s transfer agent will tabulate all votes that are received prior to the date of the Annual Meeting. The Company will appoint two inspectors of election, who may

be officers or employees, to receive the transfer agent’s tabulation, to tabulate all other votes, and to certify the results of the elections. Abstentions and broker non-votes are each included in the determination of the number of shares present and voting (i.e., for quorum purposes), but shall not be counted for the purposes of the election of Directors.

As to the advisory vote for the approval of the compensation paid to the named executive officers described in this proxy statement, the approval will be determined by a majority of the votes cast, without regard to broker non-votes or proxies marked “Abstain.”

The management knows of no matters to be submitted to the 20152016 Annual Meeting with respect to which the stockholders are entitled to vote other than the election of Directors and the advisory (non-binding) vote described above, but if procedural matters do properly come before the Meeting, the persons named in the proxy will vote according to their best judgment.

SECURITIES OWNERSHIP OF CERTAIN

BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth the number and percentage of shares of the Common Stock of the Company owned beneficially by any person, including any “group” as that term is defined in Section 12d (3) of the Securities Exchange Act of 1934, known to the Company to be the beneficial owner of five percent (5%) or more of the Common Stock, as of April 22, 2015.12, 2016. Information as to beneficial ownership is based upon statements furnished to the Company by such persons. Except as indicated, all shares are held directly, with full voting and dispositive powers, and percentages are calculated on the basis of the shares issued and outstanding, and with respect to those named persons holding options presently exercisable or within 60 days of April 22, 2015,12, 2016, includes the number of shares to be issued upon exercise of such options.

(2)

Includes 391,422 shares as to which Robert de Rothschild, Michael A. Varet and Rene-Pierre Azria have shared voting and investment power. Robert de Rothchild disclaims beneficial ownership except to the extent of his pecuniary interest in the shares. Neither Mr. Varet nor Mr. Azria has any pecuniary interest in the shares.

(3)

Includes 101,500 shares held of record by The Gaines Wehrle Revocable Trust Indenture dated November 4, 2011 as to which Mr. Wehrle has sole voting and investment power and 140,000 shares held of record by The Gaines Wehrle 2008 Family Trust as to which Mr. Wehrle has sole voting and investment power.

(3)(4)

SharesIncludes 300 shares as to which Mr. Hurt has sole voting and investment power and 201,250 shares held of record by Clint Hurt & Associates, Inc., a private company controlled by Mr. Hurt as to which Mr. Hurt has sole voting and investment power.

(4)(5)

Includes 172,500162,500 shares as to which Mr. Smeets has sole voting and investment power, and 7,500 shares as to which Mr. Smeets has sole voting power pursuant to voting agreements dated June 29, 2006, as to 2,500 each, between Mr. Smeets and his three sons who are the record owners of such shares. Mr. Smeets has no dispositive power with respect to such 7,500 shares and no pecuniary interest in such shares.

(5)(6)

Includes 54,141 shares as to which Mr. Fong has shared voting and investment power and 82,800 shares for which Mr. Fong has sole voting power pursuant to voting agreements dated June 28, 2006, between Mr. Fong and his two sons who are the record owners of such shares. Mr. Fong has no dispositive powers with respect to such 82,800 shares and no pecuniary interest in such shares.

The following table sets forth information at April 22, 2015,12, 2016, with respect to the shares of the Company’s Common Stock beneficially owned by the Directors, and the executive officers of the Company, individually, and as a group:

(6)

Includes 172,500162,500 shares as to which Mr. Smeets has sole voting and investment power, and 7,500 shares as to which Mr. Smeets has sole voting power pursuant to voting agreements dated June 29, 2006, as to 2,500 each, between Mr. Smeets and his three sons who are the record owners of such shares. Mr. Smeets has no dispositive power with respect to such 7,500 shares and no pecuniary interest in such shares.

(7)

Includes 101,500 shares held of record by The Gaines Wehrle Revocable Trust Indenture dated November 4, 2011 as to which Mr. Wehrle has sole voting and investment power and 140,000 shares held of record by The Gaines Wehrle 2008 Family Trust as to which Mr. Wehrle has sole voting and investment power.

ELECTION OF DIRECTORS

(PROPOSAL NO. 1)

Directors and Nominees

There will be submitted by the management to the 20152016 Annual Meeting for election as Directors, the seven (7) nominees whose names, together with certain information concerning them, are set out below. All of the nominees are presently serving as Directors of the Company, were elected to their present term of office by the shareholdersstockholders and have served continuously as a Director since the dates indicated below. The term of those nominees who are currently serving as Directors are expiring this year. All of the nominees are proposed for election for a one-year term expiring in 2016.2017. Four of the nominees for Directors qualify as independent directors within the meaning of applicable regulatory standards. There is no family relationship between any nominee for Director or the executive officers of the Company. In the event any of the nominees shall become unable to serve as a Director, it is intended that the proxy will be voted for a substitute nominee designated by the Board of Directors; however, no circumstances are at present known which would render any nominee unavailable.

The Board of Directors recommends a vote FOR the election of all Nominees

(Proposal No. 1 on the Proxy)

Nominees

Beverly A. Cummings, age 62,63, is a Certified Public Accountant and holds a Bachelor of Science degree from the State University of New York and a Master of Business Administration from Rutgers University. She was elected Vice President, Chief Financial Officer and Treasurer of the Company in October, 1987, and Executive Vice President and Treasurer in May, 1991, and serves as the Principal Financial Officer of the Company. Ms. Cummings holds similar positions with the Company’s subsidiaries. The attributes that prompted Ms. Cummings’ election to the Board were her significant financial skills and experience, as well as her understanding of oil and gas operations, and in particular of those of PrimeEnergy. Those qualifications continue to contribute to her effective service as a director today.

Charles E. Drimal, Jr., age 67,68, has served as President and Chief Executive Officer of the Company since October 1987, and holds the position of Chairman of the Board of Directors. He also holds similar positions with the Company’s subsidiaries. Mr. Drimal is a graduate of the University of Maryland and Samford University School of Law and is a retired member of the New York State Bar. The leadership skills, experience and thorough knowledge of the oil and gas industry that uniquely qualified Mr. Drimal to become the President and Chief Executive Officer in 1987 have continued to make him an invaluable member and Chairman of the Board of Directors.

Mr. Fong, age 70,71, is president of Gifford Fong Associates, an investment technology consulting firm located in Lafayette, California. Mr. Fong holds a Bachelor of Science, a Master of Business Administration and a Juris

Doctor degree from the University of California. Mr. Fong is the editor of The Journal of Investment Management and is the author and a frequent contributor of numerous trade journal publications. Mr. Fong’s expertise in transaction valuation, portfolio risk management and asset management is an important resource for the Board. His substantial knowledge and experience in financial matters and business operations fully qualify him to serve as a member of the Board of Directors.

Thomas S. T. Gimbel, age 60,61, is the Executive Managing Director of Optima Fund Management LLC, an investment advisory and asset management firm registered with the Securities and Exchange Commission, with offices in New York City. He previously served as Managing Director, Business and Product Development of that firm. Prior to joining Optima, he was the Managing Director of Hedge Fund Investments at Credit Suisse Asset Management, New York. In addition, he is Vice Presidentthe Chief Executive Officer and Director of American Farmland Company, a Maryland Corporation. Mr. Gimbel holds a Bachelor of Arts degree in economics from Bowdoin College and a Master of Business Administration from Columbia University Graduate School of Business. His proven ability to develop successful investment and management strategies for his clients, his keen business acumen, and his knowledge of the financial markets were some of the qualities that first formed the basis for his election to the Board. Those qualities, along with his experience in financial analysis, continue to make Mr. Gimbel’s participation on the Board efficacious.

Clint Hurt, age 7980 is president of Clint Hurt & Associates, Inc., a private oil and gas exploration company located in Midland, Texas. He is past president of the Independent Oil & Gas Association of West Virginia and is a former director of Chase Bank of Texas, in Midland, Texas. Mr. Hurt’s expertise in the oil and gas industry and his unique insight into the trends and developments in the industry made him an excellent candidate for the Board. Those attributes have also enabled him to make an important contribution to the Company in his 2728 years of service to the Board.

Jan K. Smeets, age 67,68, is the President of Smeets Management, Inc., a privately held consulting firm in Larchmont, New York. Mr. Smeets holds a Bachelor of Science and a Master of Science degree in Chemical Engineering from the Massachusetts Institute of Technology and a Masters of Business Administration from Stamford Graduate School of Business. In the course of his career, Mr. Smeets worked as a process engineer for Exxon in Aruba and as a management consultant with McKinsey and Company serving clients in the communications, chemicals and oil industries. He also served on the board of the Citco Group, an international financial services provider. His background in assessing and analyzing financial statements and related reporting qualify him as an audit committee financial expert within the meaning of the rules of the Securities and Exchange Commission and enable him to fulfill his role as Chairman of the Audit Committee. Mr. Smeets’ experience in advising businesses on the development of operational budgets, capital plans, and strategic goals have also resulted in his effectively serving the Board as a director.

Ebersole Gaines Wehrle, age 57,58, served as a director of the Company from 1987 through 2007. He resigned following the formation of McJunkin Red Man Corporation for whom he served as director, and which corporation was the result of a merger of his family’s business, the McJunkin Corporation and Red Man Pipe and Supply Co. Mr. Wehrle’s experience in the oil and gas industry spans thirty years. He worked for and was a

majority owner and director of the McJunkin Corporation, which was a wholesale provider of piping and supplies for oil and gas operations. Mr. Wehrle has also owned and operated oil and gas wells in the United States through his own private ventures. He attended Princeton University and received a Bachelor of Arts degree in Anthropology. He no longer serves as a director of any corporation and is currently self-employed and engaged

in the management of his family’s investments. The depth of Mr. Wehrle’s extensive experience in the oil and gas industry, his history with the Company and his understanding of a director’s responsibilities, provide him with unique knowledge and skills that make him a valuable member of the Company’s Board of Directors.

The Board of Directors recommends a vote FOR the election of all Nominees

(Proposal No. 1)

Information about the Executive Officers (for information regarding Ms. Cummings and Mr. Drimal, see the descriptions on page 4)5).

Mr. Drimal and Ms. Cummings were elected by the Board of Directors to their respective offices in May 2015, at the annual meeting of the Board. Each will hold their respective offices until his or her successor is elected by the Board.

TRANSACTIONS WITH RELATED PERSONS

On December 3, 2013,January 4, 2016, the Company purchased 4,50010,000 shares of Common Stock from Jan K. Smeets, for the price of $49.50$48.00 per share. Mr. Smeets is a Director and a Director Nominee of the Company. The transaction was approved by the members of the Board of Directors.

Clint Hurt, a Director and Director Nominee of the Company, is a member of Hurt Interest LLC, a company owned by Mr. Hurt and a family member. In the normal course of their businesses, Mr. Hurt and Hurt Interest LLC make investments in oil and gas producing properties, some of which are operated by the Company’s subsidiary, Prime Operating Company. They receive, like the other interest owners in the properties operated by Prime Operating Company, including the Company, revenue payments from the sale of oil and gas produced by the properties. They are also required, like the other interest owners in those properties, to pay their proportionate share of the expenses to develop and operate those properties. In 2014, and 2013, Mr. Hurt and Hurt Interest LLC received approximately $219,608, and $271,706, respectively, from the Company for their interests in properties operated by the Company, of which Mr. Hurt received $114,704 and $170,229, respectively.

H. Gifford Fong, a Director and Director Nominee of the Company, makes investments in oil and gas producing properties, some of which are operated by the Company’s subsidiary, Prime Operating Company. He receives, like the other interest owners in the properties operated by Prime Operating Company, including the Company, revenue payments from the sale of oil and gas produced by the properties. He is also required, like the other interest owners in those properties, to pay his proportionate share of the expenses to develop and operate those properties. In 2013, Mr. Fong received approximately $143,991 from the Company for his interests in properties operated by the Company.$114,704.

CORPORATE GOVERNANCE

Board Independence and Composition

The core responsibility of the Board of Directors is to provide objective, independent judgment in its management oversight function and the Board’s composition reflects that principle. The Board is composed of a majority of independent directors. A director’s independence is determined in accordance with the definition set forth in National Association of Securities Dealers Automated Quotations (“NASDAQ”) listing standards and other pertinent and applicable legal and regulatory standards. The Board of Directors annually reviews the relationships between directors orand members of their immediate families and the Company, in order to make recommendations to the full Board for its determination regarding the independence of each director. As a result of this review, the Board has determined that H. Gifford Fong, Thomas S.T. Gimbel, Jan K. Smeets and Ebersole Gaines Wehrle are independent directors.

Board Leadership

The Board of Directors, in its discretion, may elect a Chairman of the Board. The Chairman leads the Board and presides at all Board meetings, and is responsible for delivery of information for the Board’s informed decision-making.

Based upon the structure that best serves the interests of the Company, the Board determines whether the role of the Chairman of the Board and the Chief Executive Officer should be held by one individual or should be separated. Currently, the Board believes that the positions of Chairman of the Board and Chief Executive Officer should be held by the same person because this combination has served the Company well in the past and continues to work well today, by providing unified leadership and direction. The Directors have also determined that it is not necessary to appoint a lead independent director at this time.

The Board’s Role in Risk Oversight

The Company’s risk management efforts are the responsibility of the Board of Directors. The Company’s Chief Executive Officer, and the Chief Financial Officer and other officers of the Company review with the Board areas of material operational, financial and regulatory risks and the likelihood of the risks coming to fruition, to enablefruition. This enables the Board to understandhave a thorough understanding of the relative magnitude of such risks and to assess and influence the management and mitigation strategies undertaken by the Company.Company to address those risks.

Board Meetings

The Board of Directors met three timestwice in 2014.2015. Each director attended 75% or more of the aggregate number of meetings of the Board of Directors and the committee or committees thereof on which such director served during 2014.2015.

Board Attendance at Annual Meeting

The Company does not have a policy that requires members of the Board of Directors to attend the Annual Meeting. All members of the Board of Directors are encouraged to attend the Annual Meeting. All of the members of the Board of Directors attended the Annual Meeting of the Company held in May 20142015 in person.person or by telephone conference.

Committees of the Board

The Board of Directors has an Executive Committee, an Audit Committee and a Compensation Committee.

Executive Committee

The Executive Committee, composed of Messrs. Drimal, Jr., Hurt, Smeets and Ms. Cummings, is authorized to exercise all the authority of the Board in the business and affairs of the Company, except as limited by applicable law. The Executive Committee met three timestwice during 2014,2015, and informally, by telephone conference on a regular basis, usually weekly, during the year.

Audit Committee

The Audit Committee, composed of Messrs. Wehrle, Gimbel and Smeets, met once in 2014.2015. All members of the Audit Committee were independent under NASDAQ listing standards and other pertinent legal and regulatory standards. Mr. Wehrle, as the beneficial owner of more than 10% of the outstanding stock of the Company, falls outside of the safe harbor provisions of SEC Rule 10A-3(e)(1)(ii). The Board of Directors has determined that Mr. Smeets meets the qualifications of an “audit committee financial expert” within the meaning of the regulations of the Securities and Exchange Commission and NASDAQ listing standards. The Committee

selects and engages independent auditors to audit the books, records and accounts of the Company, determines the scope of such audits, and reviews the financial policies and control procedures of the Company. The report of

the Audit Committee is included in this Proxy Statementproxy statement on pages 10 -11.page 13. The Board of Directors and the Audit Committee have adopted a written charter for the Audit Committee, a copy of which was attached as Exhibit A to the Company’s 2014 Proxy Statement.proxy statement.

Compensation Committee

The Compensation Committee, composed of Messrs. Gimbel and Smeets, met once in 2014.2015. All members of the Compensation Committee were independent under NASDAQ listing standards and other pertinent legal and regulatory standards. The charter of the Compensation Committee also requires that members of the Committee also qualify as “outside directors” within the meaning of Section 162(m) of the Internal Revenue Code and as “non-employee” directors within the meaning of Rule 16b-3 of the Securities Exchange Act of 1934, as amended. The Committee annually reviews and evaluates the Company’s compensation policies and establishes salaries, bonuses and other compensation for the Company’s executive officers and directors. Mr. Drimal and Ms. Cummings participate in discussions with the Compensation Committee and make recommendations to the Committee with respect to the compensation of executive officers and directors. Neither Mr. Drimal nor Ms. Cummings participates in the deliberations or approval of the Committee concerning their respective compensation. Although the Compensation Committee has the authority, it has not engaged any outside compensation consultants to assist the Committee in determining the compensation policies of the Company, and no such outside consultants have been engaged by the Company or the Board of Directors. The Compensation Committee charter was amended by the Board of Directors in May 2013. The purpose of the amendments was to change the number of directors on the Committee to two, to clarify if the Committee retains the services of an outside consultant for guidance, it is permitted to do so at the Company’s expense, and to reflect that the Chief Executive Officer and senior executives of the Company are not to be present during the Committee’s deliberations or voting on their compensation. A copy of the Compensation Committee charter, as amended, was attached as Exhibit B to the Company’s 2014 Proxy Statement.proxy statement.

The Board as Nominating Committee

The Company does not have a standing nominating committee. The Board of Directors acts as the nominating committee, with Mr. Drimal and Ms. Cummings abstaining. The majority of the Directors of the Company, Messrs. Fong, Gimbel, Smeets and Wehrle, who function as a nominating committee, are believed to satisfy applicable regulatory requirements for independence. Those Directors are responsible for collecting and analyzing information with regard to directors’ “independence” as defined by NASDAQ listing standards and other pertinent legal and/or regulatory standards in effect at the time. They are also responsible for making recommendations concerning committee membership and ensuring that committee members satisfy the criteria for membership on a particular committee for independence and have the skills to effectively participate on a particular committee. The Directors who function as the nominating committee are also responsible for identifying and evaluating prospective nominees for vacancies on the Board of Directors. The Board of Directors will consider meritorious director candidates submitted to it by members of the Board and by stockholders of the Company, without regard to race, religion, gender, national origin or disability. The Board does not have a formal policy with regard to considering diversity in its consideration of director nominations. Candidates for election must be willing to devote the time necessary to serve as a director and must possess the level of education, experience, and expertise, both with respect to financial matters and the oil and gas industry in general, required to perform the duties of a member of the board of directors of a public company, and in particular of the Company. The Board of Directors strive to recommend candidates that further its objective of having a board that encompasses a broad range of talents and expertise and reflects a diversity of background, experience and viewpoints. The procedure to be followed by a shareholderstockholder to submit a nominee to the Committee is set forth in “Stockholder Proposals and Nominations” in this Proxy Statement.proxy statement.

The Board of Directors believes that this procedure is adequate in the process of selecting persons for electionselection as Directors of the Company. All of the Directors of the Company currently serving as Directors are designated as nominees for re-election at the 20152016 Annual Meeting of Stockholders. There were no nominations proposed by any stockholder or group.

EXECUTIVE AND DIRECTOR COMPENSATION

Compensation Overview

The Company has been guided by its Chief Executive Office,Officer, Charles E. Drimal, Jr., and Chief Financial Officer, Beverly A. Cummings since 1987. The Board of Directors attributes much of the success of the Company to Mr. Drimal’s and Ms. Cummings’ leadership, skills and dedication to the Company and its shareholders.stockholders. In order to retain such highly skilled and experienced professionals for its senior management team, the Board of Directors must offer highly competitive compensation packages. At the same time, the Board of Directors is mindful that the primary goal of the Company is to build long-term shareholderstockholder value. Therefore, the alignment of the executive officers’ compensation with the Company’s performance results is a critical component of the analysis made by the Compensation Committee in determining the executive officers’ compensation each year.

The Board of Directors believe that the Compensation Committee’s approach in determining the compensation paid to the executive officers has been endorsed by the stockholders, who in 2013 overwhelmingly supported the “say on pay” resolution to approve the executive compensation disclosed in that year’s proxy statement and voted for the frequency of their advisory vote to be held once every three years thereafter. In light of that endorsement, the Compensation Committee has adhered to that same approach in the years following that stockholders’ vote, including the current year.

There are three elements of the compensation paid to the senior management team,executive officers, to wit: (i) base salary; (ii) bonus (cash incentive) compensation, and (iii) equity awards. The base salaries that were provided to the senior management teamexecutive officers were based upon a number of considerations including each executive officer’s level of responsibility, changes in their responsibilities from year to year, experience, skills and leadership ability. The Compensation Committee reviewed the base salary paid in the most recent years and the percentage change in salary from year to year. The Compensation Committee used judgment and discretion rather than relying on any specific formula for results. The Compensation Committee weighed the difficult tasks undertaken by the executive officers in guiding the Company through a period of historic and challenging industry-wide economic downturn. Additionally, the Compensation Committee gave consideration to its decision not to award any bonus compensation to the executive officer’s ability to be awarded additional compensationofficers in the form of a bonus which compensation was more directly tied to the Company’s performance.2015, as discussed below. After discussingreviewing all of those considerations, the Compensation Committee recommended that each of the executive officers be given the same percentage increase in each of the executive officer’s salary.their salaries. The base salary paid to each executive officer in 20142015 is set forth in the “Salary” column of the Summary Compensation Table set forth in this proxy statement.

The cash incentive bonus compensation awarded to each executive officer is intended to correlate to the Company’s performance. TheIn 2015, the executive officers advised the Compensation Committee focused on performance measures such asthat in light of the increase in oildramatically lower commodity price environment and gas reserves, cash flow, debt level, growththe resultant reduction in the Company’s well servicing subsidiariescash flow and growth inearnings, they had determined that no employees of the Company’s oil and gas operations. TheCompany would be awarded bonus compensation for the year. They urged the Compensation Committee believes this combination of metric categories representsto apply the important measurements necessary for increasing shareholder valuesame performance metrics and growinganalysis in its deliberations and come to a similar conclusion regarding the Company.bonus compensation to be awarded to the executive officers. As a result, the Compensation Committee recommended that there be no incentive bonus compensation awarded each ofto the executive officer’s a cash incentive bonus. Theofficers in 2015. Therefore, the cash bonus paid to each executive officer in 20142015 is set forthreflected as $0 in the “Bonus” column of the Summary Compensation Table set forth in this proxy statement.

The Company awarded options to purchase shares of the Company’s common stock to the executive officers in May 1989. The objective of the award was to retain high level officers and to motivate them to continue their relationship with the Company and thereby align their interests with the long term interests of its shareholders.stockholders. The options that were awarded have been fully exercisable by the executive officers since May 1994. The Compensation Committee believes the options awarded to the executive officers represent a significant stake in the Company and determined not to award any more options or other types of equity compensation to the executive officers in 2014.2015.

At the Annual Meeting held in 2013, the shareholdersstockholders voted to hold an advisory, non-binding vote to approve executive compensation once every 3 years. The next “say on pay”Proposal No. 2 set forth in this proxy statement asks stockholders to approve, in a non-binding advisory vote, will occur at the Annual Meetingcompensation paid to the executive officers in 2016.2015.

SUMMARY COMPENSATION TABLE

The following table discloses compensation for the fiscal years ended December 31, 20142015 and 2013,2014, received by the Company’s Principal Executive Officer and Principal Financial Officer (1) (2).