PITTSBURGH AND WEST VIRGINIA RAILROAD
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
to be held May 17, 2007
April 17, 2007
To the Shareholders of
Pittsburgh & West Virginia Railroad:
The annual meeting of shareholders of Pittsburgh & West Virginia
Railroad will be held on May 17, 2007, at 11:00 A.M., at #2 Port
Amherst Drive, Charleston, West Virginia, for the following purposes:
(1) To elect five trustees to serve until the next annual meeting
of shareholders and until their successors have been elected
and qualified.
(2) To transact such other business as may properly come before the
meeting.
The Board of Trustees has fixed the close of business on March 16, 2007,
as the record date for the determination of stockholders entitled to
notice of and to vote at the meeting or any adjournment thereof.
By order of the Board of Trustees,
/s/ Herbert E. Jones, Jr.
Herbert E. Jones, Jr.
Chairman and Trustee
If you do not expect to attend in person, please fill in, date, sign and return
the enclosed proxy in the envelope provided. No postage is necessary if mailed
in the United States.
PITTSBURGH AND WEST VIRGINIA RAILROAD
#2 Port Amherst Drive
Charleston, West Virginia 25306
PROXY STATEMENT
This proxy statement is furnished in connection with the solicitation
of proxies by the Board of Trustees of Pittsburgh & West Virginia
Railroad (the "Trust") to be used at the annual meeting of shareholders
to be held on May 17, 2007, in Charleston, West Virginia, and at any
adjournments thereof. This proxy statement, the accompanying form of
proxy and the 2006 Annual Report will be mailed to shareholders on or
before April 17, 2007.
At the close of business on March 16, 2007, the record date, there were
outstanding and entitled to vote 1,510,000 shares of beneficial
interest. Each share is entitled to one vote on each matter brought
before the meeting. However, for the election of trustees, shareholders
are entitled to cumulative voting; that is, each shareholder will have
a number of votes equal to the number of his shares multiplied by the
number of trustees to be elected, and may cast all such votes for a
single nominee or may distribute them among the nominees in any manner.
A proxy may be revoked at any time prior to the voting thereof, by
giving notice to the Secretary of the Trust, in writing or in open
meeting.
The cost of soliciting proxies will be borne by the Trust. Solicitation
may be made by mail or by telephone and telegraph, by officers of the
Trust without extra compensation. The Trust will reimburse brokerage
firms and others for their reasonable expenses in forwarding
solicitation material to the beneficial owners of stock.
Election of Trustees
It is intended that all executed proxies, not limited to the contrary,
will be voted for the election as trustees of the five nominees listed
below, each to hold office until the next annual meeting of
shareholders, or until their successors are elected and qualified. All
nominees are members of the present Board of Trustees, and were elected
at the last Annual Meeting of Shareholders. If any nominee becomes
unavailable for any reason, the proxies will be voted for the election
of such substitute as may be designated by management.
Owned at
Nominee (Age) and Principal Occupation Trustee March 31,
Position with Trust Past 5 Years Since 2007
Herbert E. Jones, Jr. (86) (a) Vice President, (b) 1968* 4,000
Trustee, Chairman Port Amherst, Ltd.
Virgil E. Wenger (76) Certified Public 1991 200
Trustee, Audit Committee Accountant (c)
Chairman
Herbert E. Jones, III (58) (a) Professional Musician 2004 -
Trustee, President and Businessman
Larry R. Parsons (65) Chairman and Chief 2004 12,500
Executive Officer of
Wheeling & Lake Erie
Railway Company (d)
C. Howard Capito (59) April 2001-present: 2004 1,000
Principal in Shenandoah
Northern Company
June 1990-April 2001:
Senior Vice President
and Senior Banking
Executive of Bank of
America, N.A.
* Was a director of the Trust's predecessor, Pittsburgh & West Virginia Railway
Company, at the time such predecessor was completely liquidated and dissolved.
(a) Herbert E. Jones, Jr. is the father of Herbert E. Jones, III, President
(b) For more than 10 years prior to April 1, 1982, Herbert E. Jones, Jr.
was President of Amherst Coal Co.
(c) Virgil E. Wenger is an Independent Consultant. For 25 years he was a
partner of Ernst & Young.
(d) Wheeling & Lake Erie Railway Company is the principal operator and
sublessee over the track leased to Norfolk Southern Corporation and
pays Norfolk Southern Corporation for use of the track.
All trustees and officers of the Trust as a group (6 persons) owned
beneficially 17,700 shares representing 1.172% of the outstanding
shares.
Remuneration
The aggregate remuneration for services in all capacities paid or
accrued in 2006 to all trustees and officers of the Trust as a group
(six in number) was $21,000. This consisted entirely of fees for
accounting services performed by the Trust's secretary-treasurer of
$9,000 and trustees fees of $12,000. The Trust does not have pension,
profit-sharing or deferred compensation plans, or any other form of
remuneration.
Shareholder Proposals
Any shareholder proposal intended to be presented at the next annual
meeting must be received by the Trust no later than December 15, 2007.
The Trust suggests that such proposals be addressed to Robert A.
Hamstead, Vice President and Secretary-Treasurer, #2 Port Amherst
Drive, Charleston, WV 25306, and sent by certified mail, return receipt
requested.
Audit Committee
The Audit Committee's responsibilities include: (a) selection of the
Trust's independent auditors, (b) discussing the arrangements for the
proposed scope and the results of the annual audit with management and
the independent auditors, (c) reviewing the scope of any non-audit
professional services provided by the independent auditors, and (d)
obtaining from both management and the independent auditors their
observations on the Trust's system of internal accounting controls. The
Trustees have adopted a written charter setting forth the
responsibilities of the Audit Committee. A copy of that charter is
attached to this Proxy Statement.
The Audit Committee consists of three Trustees, currently Virgil E.
Wenger, Chairman, Larry R. Parsons, and C. Howard Capito. Mr. Wenger is
an audit committee financial expert as that term is defined by the
United States Securities and Exchange Commission (SEC). Each member is
able to read and understand basic financial statements, including a
balance sheet, income statement and statement of cash flows. The
Audit Committee met five times during 2006.
Independent Accountants
The firm of Gibbons & Kawash has served as the Trust's independent
auditors since 1995 and has been selected by the Audit Committee to
perform the audit of the financial statements as of and for the year
ending December 31, 2007.
During fiscal year 2006, the Trust paid Gibbons & Kawash $44,226.12 for
professional services rendered for the annual audit of the Trust's
financial statements and for reviews of the Trust's financial statement
filed in quarterly reports on Form 10-Q filed with the SEC.
A representative of Gibbons & Kawash will be in attendance at the
annual meeting to answer appropriate questions concerning the audit of
the financial statements.
Audit Committee Report
The Audit Committee has reviewed and discussed the financial statements
with management and the auditors, including the critical accounting
policies on which the financial statements are based. The Committee
discussed with the auditors their independence, received the letter
from the independent auditors required by Independence Standards Board
Standard No. 1, and the matters required to be discussed by Statement
on Auditing Standards No. 61. The Committee recommended to the Trustees
that the audited financial statements for the year ended December 31,
2006 be included in the Trust's annual report on Form 10-K for that
year.
Other Matters
The Audit Committee Charter and the Code of Conduct and Ethics, with
which all officers and trustees must comply, are attached to this proxy
statement.
The Board of Trustees does not have nominating, or compensation
committees, or any committee performing similar functions. The Board
held one regularly scheduled meeting during 2006 and on five occasions
during the year, the trustees, after conferring, adopted Board
resolutions by unanimous written consent. All of the trustees were in
attendance at those meetings.
Management knows of no other matters which are likely to be brought
before the meeting, but if any such matters properly come before the
meeting, the persons designated as proxies will vote thereon in
accordance with their best judgment.
This report includes the Trust's current Annual Report on Form 10-K,
as filed with the Securities and Exchange Commission. If desired, an
additional copy is available to shareholders, without charge, upon
written request to the Vice President and Secretary-Treasurer of the
Trust at #2 Port Amherst Drive, Charleston, WV 25306.
/s/ Robert A. Hamstead
Robert A. Hamstead
Vice President and Secretary
Treasurer
Dated: April 17, 2007
PITTSBURGH & WEST VIRGINIA RAILROAD
AUDIT COMMITTEE CHARTER
Organization
There shall be a committee of the board of directors to be known as
the audit committee. The audit committee shall be composed of at least
three directors who are independent of the management of the
corporation and are free of any relationship that, in the opinion of
the board of directors, would interfere with their exercise of
independent judgment as a committee member.
Statement of Policy
The audit committee shall provide assistance to the corporate directors
in fulfilling their responsibility to the shareholders, potential
shareholders, and investment community relating to corporate
accounting, reporting practices of the corporation, and the quality and
integrity of the financial reports of the corporation. In so doing, it
is the responsibility of the audit committee to maintain free and open
means of communication between the directors, the independent
auditors, and the financial management of the corporation.
Responsibilities
In carrying out its responsibilities, the audit committee believes its
policies and procedures should remain flexible, in order to best react
to changing conditions and to ensure to the directors and shareholders
that the corporate accounting and reporting practices of the
corporation are in accordance with all requirements and are of the
highest quality.
In carrying out these responsibilities, the audit committee will:
* Review and recommend to the directors the independent auditors to be selected
to audit the financial statements of the corporation.
* Review written disclosures regarding independence from the independent
auditors required by Independent Standards Board Standard No. 1.
* Meet with the independent auditors and financial management of the
corporation to review the scope of the proposed audit for the current year and
the audit procedures to be utilized, and at the conclusion thereof review such
audit, including any comments or recommendations of the independent auditors.
* Review with the independent auditors and accounting personnel the critical
accounting policies on which the financial statements are based, the adequacy
and effectiveness of the accounting and financial controls of the corporation,
and elicit any recommendations for the improvement of such internal control
procedures or particular areas where new or more detailed controls or
procedures are desirable. Particular emphasis should be given to the adequacy
of such internal controls to expose any payments, transactions, or procedures
that might by deemed illegal or otherwise improper. Further, the committee
periodically should review company policy statements to determine their
adherence to the code of conduct.
* Review the financial statements contained in the annual report to
shareholders with management and the independent auditors to determine that the
independent auditors are satisfied with the disclosure and content of the
financial statements to be presented to the shareholders. Any changes in
accounting principles should be reviewed.
* Provide sufficient opportunity for the independent auditors to meet with the
members of the audit committee without members of management present. Among the
items to be discussed in these meetings are the independent auditors'
evaluation of the corporation's accounting, personnel, and the cooperation that
the independent auditors received during the course of the audit.
* Review accounting and financial human resources and succession planning
within the company.
* Submit the minutes of all meetings of the audit committee to, or discuss the
matters discussed at each committee meeting with, the board of directors.
* Investigate any matter brought to its attention within the scope of its
duties, with the power to retain specialists and outside counsel for this
purpose if, in its judgment, that is appropriate.
PITTSBURGH & WEST VIRGINIA RAILROAD
CODE OF CONDUCT AND ETHICS
Introduction
This Code of Business Conduct and Ethics covers a wide range of
business practices and procedures. It does not cover every issue that
may arise, but it sets out basic principles to guide officers and
trustees of the Company. All of our officers and trustees must conduct
themselves accordingly and seek to avoid even the appearance of
improper behavior. The Company has no employees. However, should the
Company's operations require employees in the future, this Code of
Conduct and Ethics will apply to any and all employees.
If a law conflicts with a policy in this Code, you must comply with the
law; however, if a local custom or policy conflicts with this Code, you
must comply with the Code. If you have any questions about these
conflicts, you should ask the chief executive officer how to handle the
situation.
Those who violate the standards in this Code will be subject to
disciplinary action which may include immediate termination. If you are
in a situation which you believe may violate or lead to a violation of
this Code, follow the procedures described in Sections 11 and 12 of
this Code.
1. Ethical Conduct and Legal Compliance
Obeying the law, both in letter and in spirit, is the foundation on
which this Company's ethical standards are built. All officers and
trustees must obey the laws of the United States and the cities and
states in which we operate. Although not all officers and trustees are
expected to know the details of these laws, it is important to know
enough to determine when to seek advice from counsel or others.
Beyond compliance with laws, the Company requires that all its officers
and trustees act in a manner which meets the highest standards of
ethical behavior. The honesty and integrity of our business conduct
must not be compromised. The Company will not condone ethical
violations for the sake of personal gain, personal advantage,
expediency, or perceived business advantage.
2. Accounting and Auditing Matters
The Company's requirement that officers and trustees follow the highest
ethical standards applies directly to all actions which involve
business accounting, financial reporting, internal accounting controls,
auditing matters, and public disclosure obligations in filings with the
Securities and Exchange Commission and all public communications by the
Company.
The Company requires honest and accurate recording and reporting of
information in order to make responsible business decisions.
All of the Company's books, records, accounts and financial statements
must be maintained in reasonable detail, must appropriately reflect the
Company's transactions and must conform both to applicable legal
requirements and to the Company's system of internal controls.
Business records and communications often become public, and we should
avoid exaggeration, derogatory remarks, guesswork, or inappropriate
characterizations of people and companies that can be misunderstood.
This applies equally to e-mail, internal memos, and formal reports.
Records should always be retained or destroyed according to the
Company's record retention policies. In accordance with those policies,
in the event of litigation or governmental investigation please consult
the chief executive officer or counsel.
The Audit Committee of the Company has adopted special procedures for
the receipt, retention, and treatment of complaints regarding
accounting, internal accounting controls, or auditing matters. These
procedures are set out in Sections 11 and 12 of this Code.
3. Conflicts of Interest
A "conflict of interest" exists when a person's private interest may or
does interfere with the interests of the Company. A conflict can arise
when an officer or trustee takes actions or has interests that may make
it difficult to perform his or her Company work objectively and
effectively. Conflicts of interest may also arise when an officer or
trustee, or member of his or her family, receives improper personal
benefits as a result of his or her position with the Company.
It is almost always a conflict of interest for a Company to work
simultaneously for a competitor, customer or supplier as an employee,
consultant, or board member. The best policy is to avoid any direct or
indirect business connection with our competitors, customers or
suppliers, except on our behalf. Conflicts of interest are prohibited
as a matter of Company policy, except in circumstances approved by the
Board of Trustees or the Audit Committee of the Board.
Conflicts of interest may not always be clear-cut, so if you have a
question, you should consult with the chief executive officer or
counsel. Any officer or trustee who becomes aware of a conflict or
potential conflict should bring it to the attention of the chief
executive officer or follow the procedures described in Section 11 of
this Code.
Officers and trustees owe a duty to the Company to advance its
legitimate interests when the opportunity to do so arises. In
particular:
* No payments, loans, employment or promises of employment, investment
opportunities, vacation trips, gifts or entertainment (other than entertainment
conforming to generally accepted business practices or gifts of nominal value
not reasonable calculated to influence a decision) may be offered to or
accepted by any officer or trustee or a relative of such a person as a
condition of the initial or continued engagement of a consultant, broker,
vendor or third party working for the Company.
* No payments (other than fees for services), loans, employment or promises of
employment, investment opportunities, vacation trips, gifts or entertainment
(other than entertainment conforming to generally accepted business practices
or gifts of nominal value not reasonably calculated to influence a decision)
may be offered to or accepted by any consultant, broker, vendor, government
official or a relative of such third party in connection with any services
being performed for the Company.
* No officer or trustee may recommend any third party for work for the Company
where the third party's compensation is paid on the basis of any kickback or
fee sharing arrangement with the officer or trustee, nor may an officer or
trustee recommend any third party without full disclosure and written approval
by the chief executive officer, if such third party has any familial or
pre-existing monetary relationship with the officer or trustee or if such
officer or trustee has an equity or stock ownership position in such third
party.
* No employee shall, in his capacity as an employee, make any loan, donation,
contributions or payment to a political party, candidate, or political action
committee, for or on behalf of the Company, nor shall an employee of the
Company reimburse any individual who does. (Nothing contained in this tenet
shall prohibit an employee from taking any of the above actions in his or her
name, provided that the action is exclusively on the employee's own accord and
is not an indirect means of accomplishing one of the prohibited actions).
* No employee shall use or appropriate materials, property, equipment, systems
and procedures (if proprietary in nature) owned by the Company for his or her
own personal financial gain except to the extent necessary for the performance
of his or her duties for the Company.
In short, the purpose of business entertainment and gifts in a
commercial setting is to create good will and sound working
relationships, not to gain unfair advantage with customers. No gift or
entertainment should be offered, given, provided or accepted by any
Company employee, family member of an employee unless it: (1) is not a
cash gift, (2) is consistent with customary business practices, (3) is
not excessive in value, (4) cannot be construed as a bribe and is not
reasonably calculated to influence a decision and (5) does not violate
any laws or regulations. Please discuss with the chief executive
officer any gifts or proposed gifts which you are not certain are
appropriate.
* No officer or trustee shall purchase or obtain any goods or services from any
of the Company's vendors or suppliers without the prior written approval of the
President of the Company.
4. Insider Trading
Officers and trustees who have access to confidential information are
not permitted to use or share that information for stock trading
purposes or for any other purpose except the conduct of our business
and in strict conformance with all applicable laws and SEC regulations.
All non-public information for personal financial benefit or to "tip"
others who might make an investment decision on the basis of this
information is not only unethical but also illegal. The Company's
policy on insider trading is set forth more fully in the "Policy
Statement on Dealing with Company Information, Including Inside
Information and Securities Insider Trading" furnished to all officers
and trustees. If you have any questions, please consult the Company's
General Counsel.
5. Competition and Fair Dealing
We seek to outperform our competition fairly and honestly. We seek
competitive advantages through superior performance, never through
unethical or illegal business practices. Stealing proprietary
information, possessing trade secret information that was obtained
without the owner's consent, or inducing such disclosures by past or
present employees of other companies is prohibited. Each officer and
trustee should endeavor to respect the rights of and deal fairly with
the Company's customers, suppliers, competitors and employees. No
unfair advantage should be taken of anyone through manipulations,
concealment, abuse of privileged information, misrepresentation of
material facts, or any other intentional unfair-dealing practice.
6. Discrimination, Harassment and Retaliation
This policy prohibits discrimination against any person who provides
information to a federal regulatory or law enforcement agency, a member
of Congress or any committee of Congress, or to the chief executive
officer concerning conduct which the employee reasonably believes
constitutes a violation of securities laws or any provision of federal
law relating to fraud against shareholders.
No officer or trustee may retaliate against an individual for bringing
a complaint of discrimination or for participating in an investigation
or proceeding involving a complaint of discrimination.
No one may take any action harmful to any person for providing to a law
enforcement officer any truthful information relating to the commission
or possible commission of any federal offense.
7. Confidentiality
Officers and trustees must maintain the confidentiality of the
information entrusted to them or its customers, except when disclosure
is authorized by the chief executive officer or required by law.
Confidential information includes all non-public information that might
be of use to competitors, or harmful to the Company or its customers,
if disclosed. It also includes information that suppliers and customers
have entrusted to us. The obligation to preserve confidential
information continues even after employment ends.
8. Protection and Proper Use of Company Assets
Officers and trustees should endeavor to protect the Company's assets
and ensure their efficient use. Theft, carelessness and waste have a
direct impact on the Company's profitability. Any suspected incident of
fraud or theft should be immediately reported for investigation.
The obligation of officers and trustees to protect the Company's assets
includes the Company's proprietary information. Proprietary information
includes business, marketing and service plans, records, salary
information and any unpublished financial data and reports.
Unauthorized use or distribution of this information would violate
Company policy. It could also be illegal and result in civil or even
criminal penalties.
9. Payments to Government Personnel
It is strictly prohibited to make illegal payments to government
officials of any country. In addition, the U.S. Government has a number
of laws and regulations regarding business gratuities which may be
accepted by U.S. Government personnel. The promise, offer or delivery
to an official or employee of the U.S. government of a gift, favor or
other gratuity in violation of these rules would not only violate
Company policy but could also be a criminal offense. State and local
governments, as well as foreign governments, may have similar rules.
10. Waivers of the Code of Business Conduct and Ethics
Any waiver of this Code for executive officers or trustees may be made
only by the Board or the Audit Committee and will be promptly disclosed
as required by law or stock exchange regulation.
11. Reporting/Investigation Procedures
Any officer or trustee who reasonably believes that there has been a
material violation of this Code of Conduct should report it immediately
to the chief executive officer and Audit Committee. The investigation
will be handled discreetly and appropriately, and the information will
be disclosed to others only on a need to know basis and as required by
law. There will be no adverse action taken against anyone who reports
violations of the Code of Conduct or who participate in the
investigation. If the investigation leads to a conclusion that a
material violation of the Code of Conduct has occurred, the Company
will take appropriate corrective action which may include removal from
a position as trustee or officer.
The Company recognizes the potentially serious impact of a false
accusation. This Code of Conduct requires officers and trustees to act
responsibly in making complaints. Making a complaint without a good
faith basis is itself an ethical violation.
12. Special Procedures for Reporting/Investigation Complaints Regarding
Accounting, Internal Accounting Controls, and Auditing Matters
Any officer or trustee who reasonably believes that there has been a
material violation of the Code of Conduct caused by questionable
accounting or auditing matters has the right to submit a confidential,
anonymous complaint to the Audit Committee. The complaint should be
made in written form and provide sufficient information so that a
reasonable investigation can be conducted.