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<SEC-DOCUMENT>0001012709-02-001010.txt : 20020709
<SEC-HEADER>0001012709-02-001010.hdr.sgml : 20020709
<ACCEPTANCE-DATETIME>20020709170337
ACCESSION NUMBER:		0001012709-02-001010
CONFORMED SUBMISSION TYPE:	DEF 14C
PUBLIC DOCUMENT COUNT:		1
CONFORMED PERIOD OF REPORT:	20020808
FILED AS OF DATE:		20020709

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			MEXCO ENERGY CORP
		CENTRAL INDEX KEY:			0000066418
		STANDARD INDUSTRIAL CLASSIFICATION:	CRUDE PETROLEUM & NATURAL GAS [1311]
		IRS NUMBER:				840627918
		STATE OF INCORPORATION:			CO
		FISCAL YEAR END:			0331

	FILING VALUES:
		FORM TYPE:		DEF 14C
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-06694
		FILM NUMBER:		02699026

	BUSINESS ADDRESS:	
		STREET 1:		214 W TEXAS AVENUE
		STREET 2:		SUITE 1101
		CITY:			MIDLAND
		STATE:			TX
		ZIP:			79701
		BUSINESS PHONE:		9156821119

	MAIL ADDRESS:	
		STREET 1:		214 W TEXAS AVENUE
		STREET 2:		SUITE 1101
		CITY:			MIDLAND
		STATE:			TX
		ZIP:			79701

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	MILLER OIL CO
		DATE OF NAME CHANGE:	19800702
</SEC-HEADER>
<DOCUMENT>
<TYPE>DEF 14C
<SEQUENCE>1
<FILENAME>def14c-702.txt
<DESCRIPTION>MEXCO ENERGY CORPORATION
<TEXT>

                                  SCHEDULE 14C
                                 (RULE 14C-101)

                  INFORMATION REQUIRED IN INFORMATION STATEMENT

                            SCHEDULE 14C INFORMATION

                Information Statement Pursuant to Section 14(c)
      of the Securities Exchange Act of 1934 (Amendment No. ___________ )

Check the appropriate box:

[ ]  Preliminary Information Statement       [ ]  Confidential, for use of the
                                                  Commission Only (as permitted
[X]  Definitive Information Statement             by Rule 14a-6(e)(2))

                            MEXCO ENERGY CORPORATION
- --------------------------------------------------------------------------------
                  (Name of Registrant as Specified in Charter)

Payment of filing fee (check the appropriate box):

[X]  No fee required.

[ ]  Fee computed on table below per Exchange Act Rules 14c-5(g) and 0-11.

     (1)  Title of each class of securities to which transaction applies:
     ---------------------------------------------------------------------------

     (2)  Aggregate number of securities to which transaction applies:
     ---------------------------------------------------------------------------

     (3)  Per unit  price  or other  underlying  value of  transaction  computed
          pursuant to Exchange  Act Rule 0-11 (Set forth the amount on which the
          filing fee is calculated and state how it was determined):
     ---------------------------------------------------------------------------

     (4)  Proposed maximum aggregate value of transaction:
     ---------------------------------------------------------------------------

     (5)  Total fee paid:
     ---------------------------------------------------------------------------

[ ]  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:
     ---------------------------------------------------------------------------

     (2)  Form, Schedule or Registration Statement No.:
     ---------------------------------------------------------------------------

     (3)  Filing party:
     ---------------------------------------------------------------------------

     (4)  Date filed:
     ---------------------------------------------------------------------------

<PAGE>

                            MEXCO ENERGY CORPORATION
                                   Suite 1101
                               214 W. Texas 79701
                              Midland, Texas 79701
                                 (915) 682-1119
                               (915 682-1123 (FAX)

                    NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

                            To be held August 8, 2002

TO THE STOCKHOLDERS:

     Notice is hereby given that the Annual Meeting of the Stockholders of MEXCO
ENERGY  CORPORATION  (the  "Company") will be held at Petroleum Club of Midland,
500 West Wall,  Midland,  Texas 79701,  at 2:00 P.M.  Central  Standard  Time on
August 8, 2002, for the following purposes:

     1.   To elect seven directors of the Company.

     2.   To ratify the selection of auditors for the Company.

     3.   To  transact  such other  business  as may  properly  come  before the
          meeting.

     The stock transfer records for the Company will not be closed. The close of
business on July 19, 2002 has been fixed by the Board of Directors as the record
date for determining the  shareholders of the Company  entitled to notice of and
to vote at the meeting.

     DATED this 9th day of July 2002.

                                        BY ORDER OF THE BOARD OF DIRECTORS

                                        DONNA GAIL YANKO, SECRETARY

<PAGE>

                            MEXCO ENERGY CORPORATION
                              INFORMATION STATEMENT
                    FOR THE ANNUAL MEETING OF STOCKHOLDERS OF
                            MEXCO ENERGY CORPORATION

                            To be held August 8, 2002

     This  Information  Statement is furnished by the management of MEXCO ENERGY
CORPORATION  (the   "Company"),   in  connection  with  the  Annual  Meeting  of
Stockholders  of the Company to be held at Petroleum  Club of Midland,  500 West
Wall, Midland, Texas 79701, at 2:00 P.M., Central Standard Time.

     The Annual Report to  stockholders  respecting  the  Company's  fiscal year
ending March 31, 2002, and the Information Statement were mailed to stockholders
on or about July 24, 2002.

                  WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE
                        REQUESTED NOT TO SEND US A PROXY.

                                VOTING SECURITIES

     The close of  business  as of July 19,  2002 (the  "Record  Date") has been
fixed as the date of record for the  determination  of stockholders  entitled to
notice of and vote at the  Annual  Meeting.  As of the Record  Date,  there were
1,737,622   shares  of  common  stock  of  the  Company  (the  "Common   Stock")
outstanding.  Holders of shares of Common  Stock are entitled to one vote at the
Annual Meeting for each share of Common Stock held of record on the Record Date.

             PRINCIPAL STOCKHOLDERS AND STOCKHOLDINGS OF MANAGEMENT

     The following table sets forth information,  as of June 28, 2002 concerning
the Common Stock beneficially owned by each director and nominee of the Company,
by all  executive  officers,  directors  and  nominees  as a group,  and by each
stockholder  known by the Company to be the  beneficial  owner of more than five
percent (5%) of the outstanding Common Stock.

                                              Number of Shares           Percent
                                             of Common Stock               of
                                             Beneficially Owned (1)       Class
                                             ----------------------       -----
     Howard E. Cox, Jr                              213,400               12.28
     Thomas R. Craddick                              18,000                1.04
     Tamala L. McComic                                4,380                0.25
     William G. Duncan, Jr. (3)                       6,100                0.35
     Thomas Graham, Jr                              111,100                6.39
     Jack D. Ladd (3)                                 7,175                0.41
     Nicholas C. Taylor (3)                         883,811               50.86
     Donna Gail Yanko                                44,112 (2)            2.54
     Officers and directors as a group
        (7 persons)                               1,074,678               61.84

     (1)  Included in the number of shares of Common  Stock  Beneficially  Owned
          are shares that such persons have the right to acquire  within 60 days
          of June 28,  2002,  pursuant to options to purchase  such Common Stock
          (Mr.  Craddick,  12,500;  Ms. McComic,  2,500; Mr. Duncan,  2,500; Mr.
          Graham,  25,000;  Mr. Ladd,  5,000;  Mr. Taylor,  5,000 and Ms. Yanko,
          25,000).
     (2)  Of these shares,  Ms.  Yanko's spouse owns 944 shares and the right to
          acquire  7,500  shares  pursuant  to options to  purchase  such Common
          Stock.
     (3)  Denotes a non-employee Director.

<PAGE>

Compliance with Section 16(a) of the Securities Exchange Act of 1934
- --------------------------------------------------------------------

     Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors  and  executive  officers,  and  persons who own more than ten percent
(10%) of a registered  class of the Company's equity  securities,  (collectively
"Reporting  Persons"),  to file  with the  Securities  and  Exchange  Commission
("SEC") and the  National  Association  of  Securities  Dealers,  Inc.,  initial
reports of  ownership  and reports of changes in  ownership  of Common Stock and
other equity securities of the Company. Officers, Directors and greater than ten
percent (10%) shareholders are required by SEC regulation to furnish the Company
with copies of all Section 16(a) forms they file.

     Ownership of and  transactions  in Company  stock,  by executive  officers,
directors and beneficial  owners of more than 10% of the Company's common stock,
require reporting to the Securities and Exchange  Commission pursuant to Section
16(a) of the  Securities  Exchange Act of 1934.  Based  solely upon  information
provided  to  the  Company  by  individual  directors,  executive  officers  and
beneficial  owners, the Company believes that during the fiscal year ended March
31, 2002 all such reports were timely filed.

                                    DIRECTORS

     At the Annual Meeting to be held on August 8, 2002, seven persons are to be
elected  to serve on the  Board of  Directors  for a term of one year and  until
their  successors are duly elected and qualified.  All of the current  Directors
will be available for election to the Board of Directors.  The Company  nominees
for the seven directorships are set forth in the following table,  together with
certain  information  as to each  person  as of the  date  of  this  Information
Statement.

                       NOMINEES FOR ELECTION AS DIRECTORS

                                                                 Director of the
           Name               Age    Position with the Company    Company Since
     ----------------------   ---    -------------------------   ---------------
     Thomas R. Craddick        58    Director                          1998
     William G. Duncan, Jr.    59    Director                          1994
     Thomas Graham, Jr.        68    Director and Chairman             1997
                                     of the Board
                                     Director                      1990 to 1994
     Arden R. Grover           76    Director                          2001
     Jack D. Ladd              52    Director                          1998
     Nicholas C. Taylor        64    President and Director            1983
     Donna Gail Yanko          58    Vice President,                   1990
                                     Secretary, Director

     THOMAS R.  CRADDICK was elected to the Board of Directors of the Company in
March  1998.  Since  1968 to the  present,  Mr.  Craddick  has  served  as State
Representative  for the State of  Texas.  Throughout  his  tenure of the past 18
sessions  of the  Legislature,  Representative  Craddick  has  served on various
committees and conferences, most recently serving on the State Affairs Committee
and the House Ways and Means  Committee.  For more than the past seven years Mr.
Craddick has been sales  representative  for Mustang Mud,  Inc.,  as well as the
owner of Craddick Properties and owner and President of Craddick,  Inc., both of
which invest in oil and gas properties and real estate.

     WILLIAM G. DUNCAN,  JR., in November 2000,  co-founded  First Bankers Trust
Company,  currently  serving as Executive  Trust Officer of the new company.  He
previously  held  several  positions,  including  President,  with  Southeastern
Financial Services,  Louisville,  Kentucky since 1991, and served as Chairman of
the Board of Kentucky Home Trust Co., both companies  purchased in March 2000 by
National  Guardian Life  Insurance,  Madison,  Wisconsin.  Mr. Duncan has been a
Director  of the  Company  since  1994  and  is a  member  of  the  compensation
committee.

<PAGE>

     THOMAS GRAHAM, JR. was appointed Chairman of the Board of Directors, by the
Directors  of the Company in July 1997,  having  served as a director  from 1990
through 1994.  From 1994 through May 1997,  Mr. Graham served as a United States
Ambassador.  For more than ten years prior  thereto,  Mr.  Graham  served as the
General Counsel,  United States Arms Control and Disarmament  Agency, as well as
Acting  Director and as Acting Deputy Director of such agency  successively,  in
1993 and 1994.  Since  July  1997,  he has served as  President  of the  Lawyers
Alliance  for  World  Security,  and as a board  member  and  subsequently  Vice
Chairman of Thorium Power Inc. In 2000, Ambassador Graham assumed the Presidency
of a wholly owned subsidiary of Thorium Power Inc., Thorium Power  Technologies,
and was  selected as Chairman of the United  States  Committee  for the National
Laboratories.

     ARDEN R.  GROVER was  elected to the Board of  Directors  of the Company in
September 2001. Mr. Grover has been an independent oil and gas producer for more
than 40 years  and  managing  partner  of  Grover  Family  L.P.,  an oil and gas
producing company. He is a Director of Glencoe Resources Ltd., Calgary,  Alberta
Canada and Parker & Parsley Operating Company, Midland, Texas. He is an advisory
Director of Caithness  Resources Inc., a Geothermal  Energy Company,  N.Y.C. and
Clear Lake National Bank, San Antonio.  Mr. Grover is also past President of the
Permian Basin Petroleum Association.

     JACK D. LADD was elected to the Board of  Directors of the Company in March
1998 and is a member of the compensation  committee.  For 25 years, Mr. Ladd has
been a  shareholder  of the law firm of  Stubbeman,  McRae,  Sealy,  Laughlin  &
Browder,  Inc,  Midland,  Texas.  Mr. Ladd was a partner in various  real estate
partnerships  and is an arbitrator  for the National  Association  of Securities
Dealers, and a mediator certified by the Attorney Mediation Institute.  Mr. Ladd
also serves as director for Map Resources,  Inc., a company which invests in oil
and gas minerals and royalties.  In 2002, Mr. Ladd was appointed by the Governor
of Texas as a member of the State Securities Board to serve a six year term.

     NICHOLAS C. TAYLOR was elected  President,  Treasurer  and  Director of the
Company in April 1983 and continues to serve as President and Director on a part
time basis,  as required.  Mr. Taylor served as Treasurer until March 1999. From
July 1993 to the  present,  Mr.  Taylor  has been  involved  in the  independent
practice of law and other business activities including  independent oil and gas
production.  For more than the prior 19 years, he was a director and shareholder
of the law firm of Stubbeman,  McRae, Sealy, Laughlin & Browder,  Inc., Midland,
Texas,  and a partner of the predecessor  firm. In 1995, he was appointed by the
Governor  of Texas to the  State  Securities  Board  through  January  2001.  In
addition  to serving as  chairman  for four years,  he  continues  to serve as a
member pending the appointment of his successor.

     DONNA GAIL YANKO  served  part-time as Vice  President  and Director of the
Company  since 1990.  She also has served as Corporate  Secretary of the Company
since 1992 and from 1986 to 1992 as Assistant  Secretary  of the  Company.  From
1986 to the present, on a part-time basis, she has assisted the President of the
Company in his personal business activities.

     During the year ended March 31, 2002,  the Board of Directors met at eleven
regularly  scheduled  Board  meetings.  The  Board of  Directors  has  Audit and
Compensation  committees each composed of three members.  The Board of Directors
does not have a nominating committee.

     The Compensation  Committee currently consists of Messrs.  Duncan, Ladd and
Taylor,  all of whom are  non-employee  directors.  The Committee met five times
during the last fiscal  year.  The purpose of the  Compensation  Committee is to
establish  and  execute  compensation  policy  and  programs  for the  Company's
executives and employees.

     The Company has an Audit  Committee  composed of independent  directors for
which  information  regarding  the  functions  performed by the  Committee,  its
membership, and the number of meetings held during the fiscal year, is set forth

<PAGE>

in the "Report of the Audit Committee," included in this information  statement.
The Audit  Committee is governed by a written  charter  approved by the Board of
Directors. A copy of this charter is included in Appendix A.

     Management  has  presented  to the Board  that the  Company's  consolidated
financial  statements  were prepared in accordance  with  accounting  principles
generally  accepted in the United States of America.  The Company's  independent
accountants  have  provided  to the Board the written  independence  disclosures
required by Independence Standards Board Standard No. 1. Based on communications
with  management  and  the  independent  accountants,  and  the  report  of  the
independent  accountants,  the Board included the audited consolidated financial
statements in the Company's  Annual Report on Form 10-K for the year ended March
31, 2002 filed with the Securities and Exchange Commission.

                          REPORT OF THE AUDIT COMMITTEE

The primary  function of the Audit  Committee is oversight of the  corporation's
financial reporting process,  public financial reports,  internal accounting and
financial  controls,  and  the  independent  audit  of the  annual  consolidated
financial  statements.  In  fulfilling  its  oversight   responsibilities,   the
Committee reviewed the audited financial statements in the Annual Report on Form
10-K  with  management  including  a  discussion  of the  quality,  not just the
acceptability,  of the accounting principles,  the reasonableness of significant
judgments, and the clarity of disclosures in the financial statements.

The Committee reviewed with the independent auditors,  Grant Thornton, LLP (GT),
who are responsible for expressing an opinion on the conformity of those audited
financial  statements  with  generally  accepted  accounting  principles,  their
judgments  as to the  quality,  not just  the  acceptability,  of the  Company's
accounting  principles  and such other  matters as are  required to be discussed
with the Committee under generally accepted auditing standards. In addition, the
Committee has discussed with GT the auditors'  independence  from management and
the Company  including  the matters in the written  disclosures  required by the
Independence  Standards  Board and  considered  the  compatibility  of non-audit
services with the auditors' independence.

The Committee meets with the independent  auditors,  with and without management
present, to discuss the results of their examinations,  their evaluations of the
Company's internal controls,  and the overall quality of the Company's financial
reporting.

Based  on the  reviews  and  discussions  referred  to  above,  in  reliance  on
management  and GT, and subject to the  limitations  of our role,  the Committee
recommended  to the Board of  Directors,  and the Board  has  approved  that the
audited  financial  statements be included in the Annual Report on Form 10-K for
the year  ended  March 31,  2002 for filing  with the  Securities  and  Exchange
Commission.

The Committee has also recommended to the Board, and the Board has appointed, GT
to audit the Company's  financial  statements  for 2002,  subject to shareholder
ratification of that appointment.

William G. Duncan, Jr., Audit Committee Chair
Arden R. Grover, Audit Committee Member
Jack D. Ladd, Audit Committee Member

                 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     The  Company  owned  working  interests  in and served as the  operator  of
properties in which the President of the Company also owned a working  interest.
The Company operated these wells on a contract basis charging the same

<PAGE>

administrative  overhead fees as the previous  operator.  The billings for lease
operating expenses related to these properties totaled approximately $43,827 for
the year ended March 31, 2002. All of such properties were sold in October 2001.

     During  the year  ending  March  31,  2002  the  Company  entered  into two
transactions  respectively,  with a Company  director  and  employee and a Trust
related  to but not  controlled  by said  director  and  employee.  In the first
transaction the Company purchased oil and gas lease rights  representing 369 net
acres for cash  consideration of $83,000.  In the second transaction the Company
exchanged  18,400  shares of its $0.50  par value  common  stock for oil and gas
lease rights  representing 368 net acres with a value of approximately  $83,000.
Such acreage is available for exploration and production of oil and gas.

                             EXECUTIVE COMPENSATION

     The following table sets forth information  concerning annual and long-term
compensation  paid  or  accrued  to  executive  officers  for  services  in  all
capacities to the Company for the fiscal year ended March 31, 2002.

                           Summary Compensation Table

                                                        Securities      All
      Name and                                          Underlying     Other
  Principal Position       Year    Salary      Bonus     Options    Compensation
- ------------------------   ----   --------   --------   ---------   ------------
Nicholas C. Taylor         2002   $   -      $   -           -        $  1,000
   President & CEO         2001   $   -      $   -           -        $    900
                           2000   $   -      $   -         10,000     $  1,100
Donna Gail Yanko           2002   $ 10,200   $  4,605        -        $   -
   Vice President &        2001   $  9,300   $  4,599      10,000     $   -
   Secretary               2000   $  9,100   $  2,051      10,000     $    200
Tamala L. McComic          2002   $ 41,600   $  6,215      10,000     $   -
   Treasurer, Controller   2001   $   -      $   -           -        $   -
   & Assistant Secretary   2000   $   -      $   -           -        $   -
Thomas Graham, Jr.         2002   $ 24,000   $   -           -        $   -
   Chairman                2001   $ 24,000   $   -         10,000     $   -
                           2000   $  2,400   $   -         10,000     $   -
Thomas R. Craddick         2002   $  1,200   $   -           -        $   -
   Director                2001   $  1,200   $   -           -        $   -
                           2000   $  1,200   $   -         10,000     $   -

o    All  other  compensation  is  comprised  of  director  fees.  There  are no
     employment agreements or retirement benefit plans.  Currently  non-employee
     directors are paid $100 per meeting. The sole compensation  received by the
     President  and CEO of the Company for such period  consisted of  director's
     fees.

Compensation Committee Report on Executive Compensation
- -------------------------------------------------------

     The Compensation  Committee of the Board of Directors is solely responsible
for setting executive  compensation including base pay and Directors' fees. Such
payment is based on performance, including hours worked and effectiveness.

Employee Incentive Stock Option Plan
- ------------------------------------

     The Company adopted an employee  incentive  stock plan effective  September
15, 1997. Under the plan, 350,000 shares are available for distribution. Awards,
granted at the discretion of the  compensation  committee of the Board,  include
stock options and restricted stock. Stock options may be incentive stock options
or  non-qualified  stock options.  The exercise price of each option will not be
less than the  market  price of the  Company's  stock on the date of grant.  The
maximum term of the options is ten years. Restricted stock may be granted with a
condition to attain a specified  goal. The purchase price will be at least $5.00
per share of restricted  stock.  The awards of restricted stock must be accepted
within  sixty  days  and  will  vest as  determined  by  agreement.  Holders  of
restricted  stock have all rights of a shareholder of the Company.  At March 31,
2002, no restricted stock had been granted under the plan.

<PAGE>

                     OPTION GRANTS IN LAST FISCAL YEAR TABLE

<TABLE>
<CAPTION>
                                                                                    Potential Realizable
                                                                                    Value After 10 Years
                                     Individual                                      Based on Assumed
                      Number of        Grants                                        Compounded Annual
                      Securities    Percentage of                                        Rates of
                      Underlying    Total Options   Exercise                     Stock Price Appreciation
                       Options       Granted to       Price       Expiration    --------------------------
     Name             Granted(1)      Employees    (per Share)       Date       5% per Year   10% per Year
- -----------------     ----------      ---------    -----------     --------     -----------   ------------
<S>                     <C>              <C>        <C>            <C>            <C>           <C>
Tamala L. McComic       10,000           100%       $   4.00       07/23/11       $25,156       $63,750
</TABLE>

(1)  Options have a 10-year term and are vested 25% per year on the  anniversary
     date of the grant. The exercise price is a fair market value on the date of
     grant.

                 AGGREGATE OPTIONS EXERCISES IN LAST FISCAL YEAR
                     AND FISCAL YEAR END OPTION VALUES TABLE

<TABLE>
<CAPTION>
                                                   Number of Securities           Value of Unexercised
                                                  Underlying Unexercised              In-the-Money
                        Shares                         Options at                      Options at
                       Acquired                      March 31, 2002                  March 31, 2002
                          On        Value      ----------------------------    ----------------------------
      Name             Exercise    Realized    Exercisable    Unexercisable    Exercisable    Unexercisable
- -------------------    --------    --------    -----------    -------------    -----------    -------------
<S>                        <C>      <C>           <C>             <C>            <C>             <C>
Donna Gail Yanko           0        $     0       22,500          17,500         $     0         $     0
Tamala L. McComic          0        $     0            0          10,000         $     0         $     0
Thomas Graham, Jr          0        $     0       22,500          17,500         $     0         $     0
Thomas R. Craddick         0        $     0       12,500           7,500         $     0         $     0
</TABLE>

                             STOCK PERFORMANCE GRAPH

     The  following  graph  shows  how an  initial  investment  of  $100  in the
Company's Common Stock would have compared to an equal investment in the S&P 500
Index or in an index of Peer Group Competitors over a five-year period beginning
March 31, 1997 and ending March 31, 2002.  The selected  Peer Group  consists of
several larger independent oil and gas producers:  Noble Affiliates,  Inc., Pogo
Producing  Company,  Anadarko Petroleum  Corporation,  Apache  Corporation,  and
Parallel Petroleum  Corporation.  This group of companies is used by the Company
for certain comparisons.

<PAGE>

                               [GRAPHIC OMITTED]

MEXCO
S&P 500
PEER GROUP

- --------------------------------------------------------------------------------

     ======================================================================
                     1997      1998      1999      2000      2001      2002
     ----------------------------------------------------------------------
     MEXCO           $100      $139      $138      $ 97      $ 89      $ 83
     ----------------------------------------------------------------------
     S&P 500         $100      $146      $170      $198      $153      $152
     ----------------------------------------------------------------------
     PEER GROUP      $100      $107      $ 76      $108      $140      $134
     ======================================================================

                         INDEPENDENT PUBLIC ACCOUNTANTS

     The Board of  Directors  of the Company,  by  resolution,  has approved the
selection  of Grant  Thornton  LLP as the  accountants  for the  Company for the
fiscal year beginning April 1, 2002. A  representative  of that firm will not be
present at the Annual Meeting,  but will be available by telephone,  and have an
opportunity  to  make  a  statement  if  they  desire  to do so and  respond  to
appropriate  questions.  The Company  paid Grant  Thornton LLP $18,809 for audit
services  during  fiscal  2002.  This firm  provides  no other  services  to the
Company.

                               NEXT ANNUAL MEETING

     The next Annual  Meeting of the Company's  stockholders  is scheduled to be
held on August 8, 2002.  Appropriate  proposals of  stockholders  intended to be
presented  at the 2002  Annual  Meeting  must be  received  by Ms.  Gail  Yanko,
Secretary, no later than June 28, 2002, in order to be included in the Company's
Information Statement relating to such meeting.

                                  OTHER MATTERS

     Management  knows of no other business that will be presented at the Annual
Meeting other than as explained herein.

<PAGE>

     A majority in interest of the issued and outstanding  Common Stock entitled
to vote shall  constitute a quorum at the Annual  Meeting and shall be necessary
to elect the Board of Directors and transact any business.

     The cost of preparing and mailing this Information  Statement will be borne
by the Company.  The Company will, upon request,  reimburse brokers for the cost
incurred by them in mailing  copies of this  Statement  and the Annual Report of
the Company to such of their  customers as are  beneficial  owners of the Common
Stock of the Company registered in the names of such brokers.

     STOCKHOLDERS  MAY  OBTAIN  WITHOUT  CHARGE A COPY OF THE  COMPANY'S  ANNUAL
REPORT ON FORM 10-K,  INCLUDING THE FINANCIAL  STATEMENTS AND SCHEDULES THERETO,
FILED WITH THE  SECURITIES  AND  EXCHANGE  COMMISSION  FOR THE FISCAL YEAR ENDED
MARCH 31, 2002, BY WRITING THE SECRETARY, MEXCO ENERGY CORPORATION,  SUITE 1101,
214 WEST TEXAS AVENUE, MIDLAND, TEXAS 79701.

<PAGE>

                                    EXHIBIT A
                            MEXCO ENERGY CORPORATION
                    AUDIT COMMITTEE OF THE BOARD OF DIRECTORS
                                     CHARTER

PURPOSE

     The  primary  function  of the Audit  Committee  is to assist  the Board of
Directors  in  fulfilling  its  oversight  responsibilities  with respect to the
financial reports and other financial information provided by the Corporation to
the stockholders and others,  the Corporation's  system of internal controls and
the  Corporation's   audit,   accounting,   and  financial  reporting  processes
generally.

     In  carrying  out this  function,  the Audit  Committee  shall  serve as an
independent  and  objective  monitor  of the  performance  of the  Corporation's
financial reporting process and system of internal control;  review and appraise
the audit efforts of the Corporation's independent accountants;  and provide for
open, ongoing  communication  among the independent  accountants,  financial and
senior  management,  and the Board of  Directors  concerning  the  Corporation's
financial position and affairs.

COMPOSITION

     The Audit  Committee  shall be  comprised  of three or more  directors,  as
determined  by the  Board of  Directors,  each of whom  shall be an  independent
director, as determined in accordance with NASD rules. An "independent director"
means any  person  other  than an  officer  or  employee  of the  Company or its
subsidiaries or any other individual having a relationship, which in the opinion
of the  Company's  Board of  Directors,  would  interfere  with the  exercise of
independent  judgment  in carrying  out the  responsibilities  of a director.  A
director is not independent if he or she:

1)   is currently employed by the Corporation or an affiliate or has been in the
     past three years

2)   accepted  compensation  in excess of $60,000  from the  Corporation  or its
     affiliates in the prior year,  other than  compensation  for board service,
     qualified pension plan benefits, or non-discretionary compensation

3)   is a member of the immediate family, i.e. spouse,  parent,  child, sibling,
     mother-in-law,  father-in-law,  brother-in-law,  sister-in-law, son-in-law,
     daughter-in-law, or anyone who resides in the same home, of a person who is
     or has been an executive  officer of the  Corporation  or its affiliates in
     the past three years

<PAGE>

4)   is a partner or controlling  shareholder or executive officer of a business
     entity that made or  received  payments in any of the last three years from
     the Corporation that exceeded 5% of the  Corporation's or business entity's
     consolidated gross revenues or $200,000, whichever is higher

5)   is a director who is employed as an  executive of another  entity where any
     of the Company's executives serve on that entity's compensation committee.

     In  appropriate,  exceptional and limited  circumstances  and in accordance
with "NASD"'s listing standards, one Director who does not meet the independence
requirements  of NASD and who is not an employee nor an immediate  family member
of an  employee,  may be  appointed  to the Audit  Committee,  if the full Board
determines  that  membership on the  Committee by the  individual is in the best
interests of the Company and its  stockholders,  provided that the circumstances
that cause the  Director  not to meet the  independence  requirements  would not
interfere with the Director's exercise of independent judgment.  Disclosure will
be made of the nature of the relationship  that prevents the Director from being
independent  and  the  reasons  for  the  appointment  of  the  Director  to the
Committee,  in the next annual proxy or information statement subsequent to such
determination.

     In accordance  with NASD rules and as determined by the Board of Directors,
all  members  of the  Audit  Committee  shall be  "financially  literate,"  i.e.
familiar  with  basic  finance  and  accounting  practices  and able to read and
understand  fundamental financial statements,  including a balance sheet, income
statement  and cash  flow  statement,  or shall  become  able to do so  within a
reasonable  period  of time  after  appointment.  At  least  one  member  of the
Committee  shall have past  employment  experience  in  finance  or  accounting,
requisite  professional  certification  in accounting,  or any other  comparable
experience  or  background   which   results  in  the   individual's   financial
sophistication,  including being or having been a chief executive officer, chief
financial   officer  or  other   senior   officer   with   financial   oversight
responsibilities.

MEETINGS

     The Committee shall meet at least four times  annually,  or more frequently
as circumstances  dictate. The Committee shall meet at least annually,  and more
often as warranted, with the independent accountants to discuss any matters that
the Committee or independent auditors believe should be discussed privately. The
Committee shall maintain a high degree of independence  both in establishing its
agenda and directly  accessing  various  members  Mexco Energy  Corporation  and
subsidiary  management.  The  Committee  shall  meet  annually  with  management
regarding their system of

<PAGE>

internal control, results of audits, and accuracy of financial reporting.

RESPONSIBILITIES AND DUTIES

     The  Committee's  responsibility  is oversight,  and it recognizes that the
Corporation's   management  is  responsible  for  preparing  the   Corporation's
financial  statements.  Additionally,  the Committee  recognizes  that financial
management,  as well as the independent  auditors,  have more knowledge and more
detailed information about the Corporation than do the members of the Committee;
consequently,  in carrying out its oversight  responsibilities  the Committee is
not providing any expert or special assurance as to the Corporation's  financial
statements or any professional  certification as to the independent accountants'
work.

     The following  functions  shall be the common  recurring  activities of the
Committee in carrying out its oversight responsibility.  These functions are set
forth as a guide with the understanding that the Committee may diverge from this
guide as appropriate given the circumstances.

1)   Make regular reports to the full Board as the Committee deems appropriate.

2)   Review with a  representative  of financial  management and the independent
     accountants both the financial  information  contained in the Corporation's
     Quarterly Report on Form 10-Q prior to its filing, the Corporation earnings
     announcements  prior  to  release,  and  the  results  of  the  independent
     accountants' review of Interim Financial  Information  (pursuant to SAS No.
     71). The Chair may represent the entire Audit  Committee,  either in person
     or by telephone conference call, for purposes of this review.

3)   Review with management and the independent accountants at the completion of
     the annual audit of the  Corporation's  consolidated  financial  statements
     included  in the Annual  Report on Form 10-K for the last fiscal year prior
     to its filing:

     a)   the Corporation's annual consolidated financial statements and related
          footnotes;

     b)   the  independent  accountants'  audit  of the  consolidated  financial
          statements and their report;

     c)   any  significant  changes  required  in  the  independent  accountants
          statements and their report;

     d)   any serious  difficulties  or  disputes  with  management  encountered
          during the course of the audit; and

<PAGE>

     e)   other  matters  related to the  conduct  of the audit  which are to be
          communicated to the Audit Committee under generally  accepted auditing
          standards,   including   discussions   relating  to  the   independent
          accountants' judgments about such matters as the quality, not just the
          acceptability,  of the  Corporation's  accounting  practices and other
          items set forth in SAS 61  (Communication  with Audit  Committees)  or
          other such auditing standards that may in time modify,  supplement, or
          replace SAS 61.

4)   On an annual  basis,  the Audit  Committee  should  ensure  receipt of, and
     review with the independent  accountants,  a written statement  required by
     Independence  Standards  Board (ISB)  Standard No. 1, as may be modified or
     supplemented,  and discuss with the  accountants  their  independence.  The
     Committee  will  recommend  that the Board of  Directors  take  appropriate
     action on any  disclosed  relationships  that may  reasonably be thought to
     bear on the  independence  of the  accountants  and satisfy itself that the
     Corporation  has  engaged  independent   accountants  as  required  by  the
     Securities Acts administered by the Securities and Exchange Commission.

5)   On an annual basis,  the Audit Committee should review the types and extent
     of  non-audit  services to be provided by the  independent  accountants  to
     ensure they are  compatible  with  maintaining  the principal  accountants'
     independence.

6)   The Committee will have prepared the Audit Committee Report,  for inclusion
     in the annual  stockholders'  meeting proxy or information  statement.  The
     Audit Committee Report must state whether the Audit Committee:

     a)   has  reviewed  and  discussed  the  audited   consolidated   financial
          statements with management;

     b)   has discussed with the independent accountants the matters required to
          be discussed by SAS 61, as may be modified, supplemented, or replaced;

     c)   has received the written disclosures from the independent  accountants
          required by ISB  Standard  No. 1, as may be modified or  supplemented,
          and has discussed with the accountants their independence; and

     d)   has  recommended  to the Board of  Directors,  based on the review and
          discussions  referred  to in  above  items  a)  through  c),  that the
          Corporation's  consolidated  financial  statements  be included in the
          Annual  Report on Form 10-K for the last  fiscal  year for filing with
          the Commission.

<PAGE>

7)   The  Audit  Committee  and  Board  of  Directors  are  responsible  for the
     selection,   evaluation   and,  where   appropriate,   replacement  of  the
     independent  accountants.  Selection for the ensuing  calendar year will be
     submitted to the  stockholders  for ratification or rejection at the annual
     meeting of  stockholders.  Consistent  with these  responsibilities,  it is
     recognized that the independent  accountants are ultimately  accountable to
     the Board of Directors and the Audit Committee.

8)   Review and reassess the  adequacy of this Charter on an annual  basis,  and
     make  recommendations  for  change  to the  full  Board  of  Directors,  as
     appropriate.  The  charter  will be  included  as an appendix to the annual
     stockholders'  meeting proxy or information statement triennially or in the
     next annual stockholders'  meeting proxy or information statement after any
     significant amendment to the charter.

9)   In consultation  with the  independent  accountants,  regularly  review the
     integrity of the  Corporation's  financial  reporting process and system of
     internal control.

10)  Review policies and procedures with respect to officers'  expense  accounts
     and  perquisites,  including their use of corporate assets and consider the
     results  of any  review  of  these  areas by the  independent  accountants.
     Conduct an appropriate  review of related party  transactions on an ongoing
     basis. Review potential conflict of interest situations where appropriate.

11)  Review legal and regulatory  matters that may have a material impact on the
     Corporation's   consolidated   financial  statements,   related  compliance
     policies and programs and reports received from regulators.

     In addition to the activities  described  above,  the Audit  Committee will
perform  such other  functions  as  necessary  or  appropriate  under  law,  the
Corporation's  charter and By-laws,  and the resolutions and other directives of
the Board of Directors.

     The  Audit   Committee  shall  have  the  power  to  conduct  or  authorize
investigations into any matters within its scope of  responsibilities  and shall
be empowered to retain independent  counsel,  accountants or others to assist it
in the conduct of any investigation.

     The duties and  responsibilities  of a member of the Audit Committee are in
addition  to those  duties  generally  pertaining  to a member  of the  Board of
Directors.

     The Audit  Committee will report its actions to the Board of Directors with
such recommendations as the Audit Committee may deem appropriate.

</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
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