<PAGE>
As filed with the Securities and Exchange Commission on May 5, 1999
Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________
FORM S-3
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
_________________
PATINA OIL & GAS CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 75-2629477
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
1625 Broadway, Denver, Colorado 80202
Telephone No. (303) 389-3600
(Address, including zip code and telephone number, including area code, of
registrant's principal executive offices)
_________________
David J. Kornder
1625 Broadway
Denver, Colorado 80202
(303) 389-3600
(Name, address, including zip code and telephone number, including area code, of
agent for service)
_________________
PLEASE SEND COPIES OF COMMUNICATIONS TO:
J. MARK METTS, ESQ.
Vinson & Elkins L.L.P.
2300 First City Tower, 1001 Fannin
Houston, Texas 77002-6760
(713) 758-2222
Approximate date of commencement of proposed sale to the public: From time
to time after the effective date of this registration statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933 (the "Securities Act"), other than securities offered only in connection
with dividend or interest reinvestment plans, please check the following box.
[X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
_________________
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
=============================================================================================================
Title of each class of Proposed maximum Proposed maximum
securities to be Amount to be offering price per aggregate offering Amount of
registered registered unit price(1)(2)(3) registration fee
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Debt Securities(4) )
Common Stock )
Preferred Stock )..... $150,000,000 100% $150,000,000 $41,700
Depositary Shares )
Warrants )
=============================================================================================================
</TABLE>
(1) We have estimated the proposed maximum aggregate offering price solely to
calculate the registration fee under Rule 475(o) of the Securities Act. In
no event will the aggregate initial offering price of all securities we
issue exceed $150,000,000. The registered securities may be sold
separately or as units of the registered securities.
(2) The amount of securities and the principal amount of debt being registered
hereunder is presently indeterminable.
(3) The proposed maximum offering price for each class of securities we are
registering is not specified pursuant to General Instruction II.D. of Form
S-3.
(4) If any debt securities are issued at an original issue discount, then the
offering price of those debt securities shall be in an amount that will
result in an aggregate initial offering price not to exceed $150,000,000,
less the dollar amount of any registered securities previously issued.
We hereby amend this registration statement on such date or dates as may be
necessary to delay its effective date until we file a further amendment
specifically stating that this registration statement is effective in accordance
with Section 8(a) of the Securities Act. Otherwise, this registration statement
becomes effective on the date the Securities and Exchange Commission, acting
pursuant to said Section 8(a), determines.
================================================================================
Subject to Completion, Dated May 5, 1999
<PAGE>
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy them be accepted prior to the time the registration statement
becomes effective. This prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of these securities
in any State in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any such State.
================================================================================
PROSPECTUS
[LOGO]
Debt Securities
Common Stock
Preferred Stock
Depositary Shares
Warrants
PATINA OIL & GAS CORPORATION
_________________________
Throughout this prospectus we use the terms "we," "us" or "Patina" to refer
to Patina Oil & Gas Corporation. We are a publicly traded, independent energy
company that acquires, develops and produces oil and natural gas primarily in
the Wattenberg Field of Colorado's Denver-Julesburg Basin.
We currently have 15,925,731 shares of our common stock, 1,444,926 shares
of our 7.125% preferred stock, 1,735,031 shares of our 8.50% preferred stock and
2,919,451 $12.50 warrants outstanding. Our common stock trades on the New York
Stock Exchange under the symbol "POG." Our 7.125% preferred stock trades on the
New York Stock Exchange under the symbol "POGPr." Our 8.50% preferred stock was
privately placed and does not publicly trade. Our $12.50 warrants also trade on
the New York Stock Exchange under the symbol "POGWT."
_________________________
We will provide specific terms of offerings of our securities in prospectus
supplements. You should read this prospectus and any supplement to this
prospectus carefully before you invest. In particular, read the section of this
prospectus entitled "Risk Factors" on pages 3-4 to understand the risks that may
be associated with the purchase of our securities. You should also read the
documents we have referred you to in the "Where You Can Find More Information"
section of this prospectus for information about us and to find our financial
statements. Together these documents will provide you with the specific terms
of the offerings.
Neither the SEC nor any state securities commission has approved or
disapproved of these securities. This means that neither the SEC nor any state
securities commission has passed upon the accuracy, adequacy or completeness of
this prospectus. Any representation to the contrary is a criminal offense.
The date of this prospectus is May 5, 1999.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page No.
<S> <C>
ABOUT THIS PROSPECTUS..................................................................................... 1
WHERE YOU CAN FIND MORE INFORMATION....................................................................... 1
CAUTIONARY STATEMENT REGARDING FORWARD LOOKING STATEMENTS................................................. 1
OUR COMPANY AND OUR BUSINESS.............................................................................. 2
RISK FACTORS.............................................................................................. 3
RATIOS OF EARNINGS TO FIXED CHARGES AND EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS.. 5
DEBT SECURITIES........................................................................................... 5
COMMON STOCK.............................................................................................. 8
PREFERRED STOCK........................................................................................... 8
DEPOSITARY SHARES......................................................................................... 9
WARRANTS.................................................................................................. 9
USE OF PROCEEDS........................................................................................... 10
PLAN OF DISTRIBUTION...................................................................................... 10
LEGAL MATTERS............................................................................................. 11
EXPERTS................................................................................................... 11
</TABLE>
<PAGE>
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement (No. 333- ) that we
filed with the SEC using a "shelf" registration process. Under this shelf
process, we may offer from time to time any combination of the securities
described in this prospectus up to a total dollar amount of $150,000,000. Each
time we offer our securities we will provide you with a prospectus supplement
that will describe, among other things, the specific amounts and prices of the
securities being offered and the terms of the offering. The prospectus
supplement may also add, update or change information contained in this
prospectus. Therefore, before you invest in our securities, you should read
this prospectus, any prospectus supplements and all additional information
referenced in the next section.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and current reports and other information with
the SEC. You may read and copy any document we file at the SEC's public
reference room at Room 1024, Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549 and at the SEC's public reference rooms in New York, New
York and Chicago, Illinois. Please call the SEC at 1-800-SEC-0330 for further
information on their public reference rooms. In addition, the SEC maintains a
web site at http://www.sec.gov that contains reports, information statements and
other information regarding issuers that file electronically. Our SEC filings
are also available on this web site.
The SEC allows us to incorporate by reference information we file with it
into this prospectus. This procedure means that we can disclose important
information to you by referring you to documents on file or to be filed with the
SEC. The information we incorporate by reference is part of this prospectus,
and later information that we file with the SEC will automatically update and
supersede this information. Therefore, before you decide to invest in a
particular offering under this shelf registration, you should always check for
SEC reports we may have filed after the date of this prospectus. We incorporate
by reference the documents listed below and any future filings made with the SEC
under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934
(the "Exchange Act") until all offerings under this shelf registration are
completed:
* Annual Report on Form 10-K for the year ended December 31, 1998;
* Quarterly Reports on Form 10-Q for the quarters ended March 31, 1998, June
30, 1998, September 30, 1998 and March 31, 1999;
* The description of our common stock, our 7.125% preferred stock and our
$12.50 warrants set forth in the Patina Oil & Gas Corporation and Gerrity
Oil & Gas Corporation Proxy Statement/Prospectus dated April 2, 1996; and
* The description of our 8.50% preferred stock set forth in the Patina Oil &
Gas Corporation Proxy Statement dated September 19, 1997.
You may request a copy of these filings at no cost, by making written or
telephone requests for such copies to:
David J. Kornder
Patina Oil & Gas Corporation
1625 Broadway
Denver, Colorado 80202
Telephone: (303) 389-3600
You should rely only on the information incorporated by reference or provided
in this prospectus or any prospectus supplement. We have not authorized anyone
else to provide you with any information. We are not making an offer of these
securities in any state where the offer is not permitted. You should not assume
that the information in this prospectus or any prospectus supplement is accurate
as of any date other than the date on the front of each document.
CAUTIONARY STATEMENT REGARDING FORWARD LOOKING STATEMENTS
This prospectus contains statements that constitute "forward looking
statements" within the meaning of Section 27A of the Securities Act and Section
21E of the Exchange Act. In general, any statement other than a statement of
historical fact is a forward looking statement. These statements appear in a
number of places in this prospectus and include statements regarding our plans,
beliefs and expectations with respect to, among other things:
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* Estimates of oil and natural gas reserves and future production;
* Future acquisitions;
* Future oil and natural gas prices;
* Expected future development and operating costs;
* Future capital expenditures;
* Trends affecting our future financial condition or results of operation;
and
* Our business strategy regarding future operations.
Any such forward-looking statements are not assurances of future
performance and involve risks and uncertainties. Actual results may differ
materially from anticipated results for a number of reasons, including:
* Industry conditions;
* Future demand for oil and natural gas;
* Economic, political and administrative developments that impact federal,
state and local departments and agencies that regulate the oil and natural
gas industry;
* Competitive developments in the oil and gas industry;
* Conditions of the capital markets;
* Our ability to successfully acquire and efficiently integrate new
properties into our exploration and development activities; and
* Our ability to successfully implement our Year 2000 readiness program.
The information we set forth under the heading "Risk Factors" details these
and other facts that could affect our operating results. You should carefully
consider all this information before you invest.
OUR COMPANY AND OUR BUSINESS
We are an independent energy company that acquires, develops, exploits and
produces oil and natural gas primarily in the Wattenberg Field ("Wattenberg" or
the "Field") of Colorado's Denver-Julesburg Basin. We were formed in early 1996
to hold the Wattenberg assets of Snyder Oil Corporation ("SOCO") and facilitate
the acquisition of Gerrity Oil & Gas Corporation in May 1996, which owned other
Wattenberg assets. At that time, SOCO owned 70% of our 20.0 million common
shares. In October 1997, SOCO sold 10.9 million shares of its Patina common
stock in a public offering and then we repurchased the remaining 3.0 million of
our common shares owned by SOCO. We financed this transaction through the
issuance of $40.0 million of 8.50% convertible preferred stock and the issuance
of 160,000 of our common shares to certain institutional investors.
We are one of the largest producers in the Wattenberg Field and currently
account for over 30% of the field's total production. The Wattenberg Field,
discovered in the early 1970's, is located approximately 35 miles northeast of
Denver. It stretches over portions of Adams, Boulder and Weld counties in
Colorado. As of December 31, 1998, we had $351.5 million in assets and
interests in 3,600 wells with net proved reserves of 372 billion cubic feet of
gas equivalent having an estimated pre-tax present value of $225.1 million based
on unescalated year-end prices. Approximately 77% of these reserves were
natural gas and 95% of the reserve value was attributed to proved developed
reserves. Our average daily production during 1998 consisted of 4,654 barrels
of oil and 69,923 Mcfs of gas, or 97.8 MMcfe per day on an equivalent basis.
Our business strategy is straightforward. We believe our sizeable asset
base and cash flow, along with our low production costs and efficient operating
structure, provide us with a competitive advantage in Wattenberg and other
analogous basins. We believe that our operational economies of scale and solid
financial condition, combined with our management team's acquisition experience,
positions us to increase our reserves, production and cash flow in a cost-
efficient manner through:
* Further development and exploitation of our Wattenberg properties;
* Selectively pursuing consolidation and acquisition opportunities; and
* The generation of grassroots drilling prospects with the potential to add
significant reserves and production.
During 1998, we expanded our properties beyond the Wattenberg Field with
the acquisition of a drilling prospect of approximately 90,000 gross acres in
Wyoming. Our executive offices and operating headquarters are located at 1625
Broadway, Denver, Colorado 80202 and our telephone number is (303) 389-3600.
2
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RISK FACTORS
In addition to the other information in this prospectus, you should
carefully consider and evaluate all of the information relating to risk factors
set forth below.
Demand for Our Oil and Gas from Our Customer Base
We sell our oil and natural gas production to end-users, marketers and
refiners and other similarly situated purchasers that have access to natural gas
pipeline facilities near our properties or the ability to truck oil to local
refineries or pipeline delivery points. The demand for oil and natural gas
production and our ability to market it to our customers may be affected by a
number of factors that are beyond our control and that we cannot accurately
predict at this time. These factors include:
* The performance of the U.S. and world economies;
* Retail customers demand for oil and natural gas;
* The competitive position of alternative energy sources;
* The price of our oil and natural gas production as compared to that for
similar product grades from other producing basins;
* The availability of pipeline and other transportation facilities that may
make oil and natural gas production from other producing areas competitive
for our customers to use; and
* Our ability to maintain and increase our current level of production over
the long term.
Fluctuations in Profitability of the Oil and Gas Industry
The oil and natural gas industry is highly cyclical and historically has
experienced severe downturns characterized by oversupply and weak demand. Many
factors affect our industry, including general economic conditions, consumer
preferences, personal discretionary spending levels, interest rates and the
availability of credit and capital to pursue new production opportunities. We
cannot guarantee that our industry will not experience sustained periods of
decline in the future. Any such decline could have a material adverse affect on
our business.
Competition for the Acquisition of New Properties
The oil and natural gas industry is very competitive. Other exploration
and production companies compete with us for the acquisition of new properties.
Among them are some of the largest oil companies in the United States and other
substantial independent oil and natural gas companies. Many of these companies
have greater financial and other resources than we do. Our ability to increase
our reserves in the future will depend upon our ability to select and acquire
suitable oil and gas properties in this competitive environment.
Operating Risks of Oil and Natural Gas Operations
The oil and natural gas business involves certain operating hazards such as
well blowouts, cratering, explosions, uncontrollable flows of oil, natural gas
or well fluids, fires, formations with abnormal pressures, pollution, releases
of toxic gas and other environmental hazards and risks. As customary with
industry practice, we maintain insurance against some, but not all, of these
hazards and risks. The occurrence of such an event or events not fully covered
by insurance could have a material adverse affect on our business.
The Effect of Regulation
Our business is heavily regulated by federal, state and local agencies.
This regulation increases our cost of doing business, decreases our flexibility
to respond to changes in the market and lengthens the time it may take for us to
gain approval of and complete capital projects. We may be subject to
substantial penalties if we fail to comply with any regulation. In particular,
the Colorado Oil & Gas Conservation Commission has promulgated regulations to
protect ground water, conserve soil, provide for site reclamation, ensure
setbacks in urban areas, generally promote safety concerns and mandate financial
assurance for companies in the industry. To date, these rules and regulations
have not adversely affected us. We continue to take an active role in the
development of rules and regulations that directly impact our operations.
However, we cannot assure you that regulatory changes enacted by the Colorado
Oil & Gas Conservation Commission or other regulatory agencies that have
jurisdiction over us will not increase our operating costs or otherwise
negatively impact the results of our operations.
3
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The Potential for Environmental Liabilities
We are subject to numerous laws and regulations governing the discharge of
materials into the environment or otherwise relating to environmental
protection. We currently own or lease numerous properties that have been used
for many years for oil and natural gas production. Although we believe that we
and previous owners used operating and disposal practices that were standard in
the industry at the time, hydrocarbons and other waste products may have been
disposed of or released on or under the properties owned or leased by us. In
connection with our most significant acquisitions, we have conducted
environmental assessments and have found no instances of material environmental
non-compliance or any material clean-up liabilities requiring action in the near
future. However, we have not performed such environmental assessments on all of
our properties. As to all of our properties, we cannot assure you that past
disposal practices, including those that were state-of-the-art at the time
employed, will not result in significant future environmental liabilities. In
addition, we cannot assure you that in the future regulatory agencies with
jurisdiction over us will not enact additional environmental regulations that
will negatively affect properties we currently own or acquire in the future.
We also operate exploration and production waste management facilities that
enable us to treat, bioremediate and otherwise dispose of tank sludge and
contaminated soil generated from our operations. We cannot assure you that
these facilities or other commercial disposal facilities operated by third
parties that we have used from time to time will not in the future give rise to
environmental liabilities for which we will be responsible. The trend toward
stricter standards in environmental regulation could have a significant adverse
impact on our operating costs as well as our industry in general.
Hedging of Oil and Natural Gas Prices
From time to time, we hedge a portion of our oil and natural gas production
using a variety of instruments, including fixed price swaps and options and
exchange-traded futures contracts and options thereon. These activities, while
intended to reduce our sensitivity to changes in market prices of oil and
natural gas, are subject to a number of risks including (i) our production is
less than we expected; (ii) there is a widening of price differentials between
delivery points required by fixed price delivery contracts, to the extent they
differ from those points we typically deliver our production; or (iii) our
customers or the counterparties fail to purchase or deliver the contracted
quantities of oil or natural gas. Also, fixed price sales and hedging contracts
limit the benefits we will realize if actual prices rise above the hedging
contract prices.
Short Length of Our Operating History and Reliance on Key Personnel
As discussed above, we were formed in 1996. We do not have a long track
record of operation as an independent company. We believe we have in place
efficient and effective management controls. Particularly in light of our short
operating history, we cannot provide you with any assurance that our success
will continue over the long term.
By industry standards, we are a small, independent company. We depend to a
large extent on the abilities and continued efforts of our executive officers
and senior management. We believe we have in place a strong management team
that is committed to us over the long term. However, we cannot assure you that
the departure of one or more of our key personnel would not adversely affect our
business.
Year 2000
Year 2000 issues result from the inability of computer programs or
computerized equipment to accurately calculate, store or use date sensitive
information. The Year 2000 problem arises because computers and embedded chips
in other devices use two digit rather than four digit codes. Therefore,
computer devices may interpret "00" as 1900 rather than 2000. This error could
result in a system failure or miscalculations causing disruptions in operations,
including among other things, the failure of our operations and production
equipment and interference with our ability to market our oil and natural gas.
We have recognized the need to ensure that our internal computer systems
and equipment relying on embedded chips are not adversely impacted by the Year
2000 problem. We have taken steps to identify potential areas of risk and have
begun addressing these in our planning and daily operations. The total costs
incurred to date in the assessment, evaluation and remediation of the Year 2000
compliance matters have been nominal and we estimate that total future third
party, software and equipment costs, based upon information developed to date,
will be less than $100,000. In connection with acquisitions of future
properties, we may need to review and address those properties' Year 2000
readiness.
We are currently reviewing the potential adverse impact on us of the
failure of our third party service providers or vendors to address their Year
2000 issues through written inquiries. While we do not believe that any one
third party service provider or vendor's failure to become Year 2000 compliant
would have a material adverse affect on our business, in the aggregate the Year
2000 problem could materially and adversely affect our business because we are
dependent on our third party service providers and vendors
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for the successful operation of our business. Although we have no reason to
believe that our third party service providers and vendors will not be Year 2000
ready, at this time we have not obtained written assurance from all of our
significant third parties that their systems are Year 2000 compliant. If the
follow-up assessment of any significant third party responses indicates that
they will not be Year 2000 compliant, we may find it necessary to develop
contingency plans to minimize disruption of our business.
RATIOS OF EARNINGS TO FIXED CHARGES AND EARNINGS TO COMBINED FIXED CHARGES AND
PREFERRED STOCK DIVIDENDS
<TABLE>
<CAPTION>
Years Ended December 31,
1994 1995 (a) 1996 1997 (a) 1998 (a)
------ --------- ------ --------- ---------
<S> <C> <C> <C> <C> <C>
Ratio of earnings to fixed
charges......................... 2.17 0.40 1.22 (0.06) 0.65
Ratio of earnings to combined
fixed charges and preferred
stock dividends................. 2.17 0.40 1.08 (0.05) 0.43
</TABLE>
For an explanation of the computation of these ratios, please see Exhibit
12.1 attached to this prospectus.
a. The ratio indicates a less than one-to-one coverage because the earnings
were inadequate to cover the fixed charges for the period. Our historical
earnings for the years ended December 31, 1995, 1997 and 1998 were insufficient
to cover our fixed charges. The amounts of the deficiencies were $3.2 million,
$16.9 million and $4.5 million respectively, for the ratio of earnings to fixed
charges and $3.2 million, $20.2 million and $10.9 million respectively, for the
ratio of earnings to combined fixed charges and preferred stock dividends.
DEBT SECURITIES
Description of Debt Securities
The following are the general terms and conditions that could apply to debt
securities we may issue under this shelf registration statement. If and when we
offer debt securities, a prospectus supplement will state the particular terms
and conditions that actually apply to the debt securities included under the
prospectus supplement.
The Debt Securities may be:
* Unsecured general obligations; and
* Either senior debt securities or subordinated debt securities.
If we offer senior debt securities, we will issue them under a senior
indenture. If we offer subordinated debt securities, we will issue them under a
subordinated indenture. In this prospectus, we refer to the senior indenture
and the subordinated indenture as an "Indenture" and collectively as the
"Indentures." We will enter into the Indentures with a trustee that is
qualified to act under the Trust Indenture Act of 1939, (the "TIA") (together
with any other trustee(s) chosen by us and appointed in a supplemental indenture
with respect to a particular series of Debt Securities, the "Trustee"). We will
identify the Trustee for each series of Debt Securities in the applicable
prospectus supplement. We will file the form of the Indentures and any
supplemental indentures from time to time by means of an exhibit to a Current
Report on Form 8-K. These filings will be available for inspection at the
corporate trust office of the Trustee, or as described above under "Where You
Can Find More Information." The Indentures will be subject to, and governed by,
the TIA. We will execute an Indenture and supplemental indenture if and when we
issue any Debt Securities.
Specific Terms of Each Series of Debt Securities in the Prospectus Supplement
A prospectus supplement and a supplemental indenture relating to any series
of Debt Securities we offer will include specific terms relating to such Debt
Securities. These terms will include some or all of the following:
* The form and title of the Debt Securities;
* The total principal amount of the Debt Securities;
* The assets, if any, that are pledged as security for the payment of the
Debt Securities;
* The portion of the principal amount that will be payable if the maturity of
the Debt Securities is accelerated;
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* Any right we may have to defer payments of interest by extending the dates
payments are due whether interest on those deferred amounts will be payable
as well;
* The dates on which the principal of the Debt Securities will be payable;
* The interest rate that the Debt Securities will bear and the interest
payment dates for the Debt Securities;
* Any conversion or exchange provisions;
* Any optional redemption provisions;
* Any sinking fund or other provisions that would obligate us to repurchase
or otherwise redeem the Debt Securities;
* Any Events of Default or covenants; and
* Any other terms of the Debt Securities.
Provisions only in the Senior Indenture
The senior debt securities will rank equally in right of payment with all
of our other senior and unsubordinated debt and senior in right of payment to
any of our subordinated debt (including the Subordinated Debt Securities). The
senior indenture may contain provisions that:
* Limit our ability to put liens on our principal assets; and
* Limit our ability to sell and lease back our principal assets.
The Subordinated Indenture may not contain any similar provisions. We have
described below these provisions and some of the defined terms used in them.
Provisions only in the Subordinated Indenture
Subordinated Debt Securities Subordinated to Senior Debt
The Subordinated Debt Securities will rank junior in right of payment to
all of our Senior Debt. "Senior Debt" is defined to include all notes or other
evidences of indebtedness, including our guarantees for money we borrowed, not
expressed to be subordinate or junior in right of payment to any of our other
indebtedness.
Payment Blockages
The Subordinated Indenture may provide that no payment of principal,
interest or any premium on the Subordinated Debt Securities may be made in the
event that we fail to pay when due any amounts on any Senior Debt and in other
instances specified in an Indenture.
No Limitation on Amount of Senior Debt
The Subordinated Indenture may or may not limit the amount of Senior Debt
that we may incur.
Modification of Indentures
Under each Indenture, generally we and the Trustee may modify our rights
and obligations and the rights of the holders with the consent of the holders of
a specified percentage of the outstanding holders of each series of debt
affected by the modification. No modification of the principal or interest
payment terms, and no modification reducing the percentage required for
modifications, is effective against any holder without its consent. In
addition, we and the Trustee may amend the Indentures without the consent of any
holder of the Debt Securities to make certain technical changes.
Events of Default and Remedies
"Event of Default" will be defined in an Indenture.
Registration of Notes; Global Securities
We may issue Debt Securities of a series in whole or part in registered,
bearer, coupon or global form. A global security is a security, typically held
by a depositary, that represents the beneficial interest of a number of
purchasers of the security.
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Book Entry, Delivery and Form
Unless otherwise stated in any prospectus supplement, The Depositary Trust
Company, New York, New York ("DTC") will act as depositary. Book-entry notes of
a series will be issued in the form of a global note that will be deposited with
DTC. This means that we will not issue certificates to each holder. One global
note will be issued to DTC who will keep a computerized record of its
participants (for example, your broker) whose clients have purchased the notes.
The participant will then keep a record of its clients who purchased the notes.
Unless it is exchanged in whole or in part for a certificate note, a global note
may not be transferred; except that DTC, its nominees and their successors may
transfer a global note as a whole to one another.
Beneficial interests in global notes will be shown on, and transfers of
global notes will be made only through, records maintained by DTC and its
participants.
DTC has provided us the following information: DTC is a limited-purpose
trust company organized under the New York Banking Law, a "banking organization"
within the meaning of the New York Banking Law, a member of the United States
Federal Reserve System, a "clearing corporation" within the meaning of the New
York Uniform Commercial Code and a "clearing agency" registered under the
provisions of Section 17A of the Exchange Act. DTC holds securities that its
participants ("Direct Participants") deposit with DTC. DTC also records the
settlement among Direct Participants of securities transactions, such as
transfers and pledges, in deposited securities through computerized records for
Direct Participant's accounts. This eliminates the need to exchange
certificates. Direct Participants include securities brokers and dealers,
banks, trust companies, clearing corporations and certain other organizations.
DTC's book-entry system is also used by other organizations such as
securities brokers and dealers, banks and trust companies that work through a
Direct Participant. The rules that apply to DTC and its participants are on file
with the SEC.
DTC is owned by a number of its Direct Participants and by the New York
Stock Exchange, Inc., The American Stock Exchange, Inc. and the National
Association of Securities Dealers, Inc.
We will wire principal and interest payments to DTC's nominee. We and the
Trustee will treat DTC's nominee as the owner of the global notes for all
purposes. Accordingly, we, the Trustee and any paying agent will have no direct
responsibility or liability to pay amounts due on the global notes to owners of
beneficial interests in the global notes.
It is DTC's current practice, upon receipt of any payment of principal or
interest, to credit Direct Participants' accounts on the payment date according
to their respective holdings of beneficial interests in the global notes as
shown on DTC's records. In addition, it is DTC's current practice to assign any
consenting or voting rights to Direct Participants whose accounts are credited
with notes on a record date, by using an omnibus proxy. Payments by participants
to owners of beneficial interests in the global notes, and voting by
participants, will be governed by the customary practices between the
participants and owners of beneficial interests, as is the case with notes held
for the account of customers registered in "street name." However, payments
will be the responsibility of the participants and not of DTC, the Trustee or
us.
Notes represented by a global note will be exchangeable for certificated
notes with the same terms in authorized denominations only if:
* DTC notifies us that it is unwilling or unable to continue as depositary or
if DTC ceases to be a clearing agency registered under applicable law and a
successor depositary is not appointed by us within 90 days; or
* We determine not to require all of the notes of a series to be represented
by a global note and notify the Trustee of our decision.
The Trustee
The Trustee will have duties, responsibilities and rights as specified in
the Indenture.
7
<PAGE>
COMMON STOCK
Description of Common Stock
For a full description of our common stock, please see the documents
identified in the section "Where You Can Find More Information" in this
registration statement. As of the date of this prospectus, we are authorized to
issue up to 100,000,000 shares of our common stock. As of May 4, 1999, we had
15,925,731 shares of common stock issued and had reserved an additional
15,500,532 shares of common stock for issuance under our various stock and
compensation incentive plans, upon conversion of our 7.125% preferred stock and
8.50% preferred stock and exercise of our $12.50 warrants. Each share of common
stock is entitled to one vote in the election of directors and other matters.
PREFERRED STOCK
Description of Preferred Stock
For a full description of our existing preferred stock issues, please see
the documents identified in the section "Where You Can Find More Information" in
this registration statement. As of the date of this prospectus, we are
authorized to issue up to 5,000,000 shares of our preferred stock. As of May 4,
1999, we had issued 1,444,926 shares of our 7.125% preferred stock and 1,735,031
shares of our 8.50% preferred stock. Our 7.125% preferred stock is convertible
into common stock at $8.61 per share, or 2.9036 common shares while the 8.50%
preferred stock is convertible into common stock at $9.50 per share, or 2.6316
common shares. Each preferred issue has a $25.00 per share liquidation
preference, plus accrued and unpaid dividends. The holders of the 7.125%
preferred are not generally entitled to vote, while holders of the 8.50%
preferred are entitled to vote with the common stock, based upon the number of
shares of common stock into which the shares of the 8.50% preferred stock are
convertible. If we issue preferred stock under this shelf registration
statement, we will describe the particular terms of that preferred stock in a
prospectus supplement. With regard to each series of preferred stock that we
may issue, those terms may include:
* The purchase price;
* The number of shares offered;
* The title and liquidation preference
* The dividend rate;
* The method by which dividends will be calculated and the dates on which
dividends will be paid or the date from which dividends will begin to
accumulate;
* Any redemption or sinking fund provisions;
* Any conversion provisions;
* Any voting rights; and
* Any additional right, preferences, privileges, limitations and
restrictions.
The preferred stock will be, when issued, fully paid and nonassessable.
You should also refer to the certificate of designation establishing a
series of preferred stock that we will file with the Secretary of State of the
State of Delaware and the SEC in connection with any offering of preferred
stock.
General Dividend Rights
Any preferred stock we issue under this registration statement will be
preferred over our common stock as to the payment of dividends. The holder of
shares of each series of our preferred stock will be entitled to receive
dividends when, as and if declared by our board of directors. We will pay those
dividends in cash, shares of common stock or preferred stock or otherwise at the
rate and on the date or dates set forth in the prospectus supplement
accompanying the offer of that series of our preferred stock. Accruals of
dividends will not bear interest. Unless we set forth otherwise in a prospectus
supplement with respect to each series of preferred stock, the dividends of each
share will be cumulative from the date of issue of the share.
8
<PAGE>
Rights on Liquidation
Any preferred stock we issue under this shelf registration will also be
preferred over common stock as to asset distributions. Holders of each series
of preferred stock issued under this registration statement will be entitled to
be paid upon our voluntary or involuntary liquidation, dissolution or winding up
before any distribution is made to the holders of common stock. This
liquidation preference may be limited to a set amount as set forth in any
applicable prospectus supplement. Upon liquidation, holders of our preferred
stock will not be entitled to any form of payment other than the liquidation
preference attached to the preferred shares.
Redemption
We may redeem shares of our preferred stock as set forth in any prospectus
supplement accompanying any offer of our preferred stock. All shares or any
series of shares of our preferred stock may be convertible into shares of our
common stock or into shares of other series of our preferred stock to the extent
set forth in applicable prospectus supplements.
DEPOSITARY SHARES
Description of Depositary Shares
We may elect to offer fractional rather than full shares of our serial
preferred stock. If we do, we will issue receipts for depositary shares and
each of these depositary shares will represent a fraction of a share of a
particular series of preferred stock. The shares of any series of preferred
stock underlying the depositary shares will be deposited under a deposit
agreement between us and a depositary we select. At a minimum, the depositary
will be a bank or trust company with a principal office in the United States and
a combined capital and surplus of at least $50,000,000. Subject to the terms of
the deposit agreement, each owner of a depositary share will be entitled, in
proportion to the applicable fractional interest in shares of preferred stock
underlying the depositary share, to all the rights and preferences of the
preferred stock underlying that depositary share, including dividend, voting,
redemption, conversion and liquidation rights. If and when we issue depositary
shares, we will specify the particular terms and conditions of our depositary
shares and depositary agreement in a prospectus supplement. Those terms may
include:
* Dividend and other distribution rights;
* Redemption rights;
* Voting rights;
* Amendment and termination of the deposit agreement;
* Charges of the depositary for which we will be responsible;
* The terms and conditions on which the depositary may resign or be removed;
and
* Any other terms of the depositary shares.
WARRANTS
Description of Securities Warrants
For a full description of our existing warrants, please see the documents
identified in the section "Where You Can Find More Information" in this
registration statement. As of May 4, 1999, we had 2,919,451 warrants
exercisable at $12.50 per common share outstanding. These warrants expire in
May 2001. Under this registration statement, we may issue securities warrants
for the purchase of debt securities, preferred stock or common stock. We may
issue securities warrants independently or together with debt securities,
preferred stock or common stock and they may be attached to or separate from any
offered securities. If we issue securities warrants, we will issue them under a
warrant agreement that we will enter into with a bank or trust company as
warrant agent. This securities warrant agent will act solely as our agent in
connection with the securities warrants and will not assume any obligation or
relationship of agency or trust for or with any registered holder or beneficial
owner of the securities warrants. In addition to this summary and any
information concerning warrants in applicable prospectus supplements, you should
refer to the securities warrant agreement to understand fully the terms and
conditions of any securities warrants we issue. We will file any securities
warrant agreement with the SEC if we offer securities warrants under this shelf
registration statement.
We will describe the particular terms of any securities warrants in a
prospectus supplement if and when we issue securities warrants under this shelf
registration statement. Those terms may include:
9
<PAGE>
* The title and price of the warrants;
* The terms upon which the securities warrants may be exercised for the
purchase of the security to which they relate;
* The price at which the security to which the warrant relates may be
purchased upon exercise;
* The date(s) on which the right to exercise the security warrants will
commence and the date on which it will expire;
* If applicable, any U.S. federal income tax consequences applicable to the
securities warrants and any other terms of the securities warrant; and
* Any other terms of the warrants.
Our securities warrants will be issued in registered form only. The holder
of each securities warrant will be entitled to purchase the principal amount of
a security or a number of shares of that security set forth in the applicable
prospectus supplement. The exercise price may be adjustable dependent upon
occurrence of events as may be set forth in the prospectus supplement. If
securities warrants we issue expire before they are exercised, they will become
void. In the prospectus supplements, we will specify the place or places where
and the manner in which securities warrants may be exercised. Prior to the
exercise of our securities warrants, the holder thereof will not have any rights
in the underlying securities.
USE OF PROCEEDS
Unless otherwise indicated to the contrary in an accompanying prospectus
supplement, we will use the net proceeds from the sale of the shares of our
securities covered by this shelf registration for general corporate purposes,
which may include:
* Repayment of indebtedness;
* The acquisition of oil or natural gas properties and other capital
expenditures; and
* Additions to working capital.
PLAN OF DISTRIBUTION
Under this prospectus, we intend to offer our securities to the
public through:
* One or more broker-dealers;
* Underwriters; or
* Directly to investors.
We will fix a price or prices, and we may change the price of the
securities offered from time to time:
* At market prices prevailing at the time of any sale under this shelf
registration statement;
* Prices related to such market prices; or
* Negotiated prices.
We will pay or allow distributors' or sellers' commissions that will not
exceed those customary in the types of transactions involved. Broker-dealers
may act as agent or may purchase securities as principal and thereafter resell
such securities from time to time:
* In or through one or more transactions (which may involve crosses and block
transactions) or distributions;
* On the New York Stock Exchange;
* In the over-the-counter market; or
* In private transactions.
Broker-dealers or underwriters may receive compensation in the form of
underwriting discounts or commissions and may receive commissions from
purchasers of the securities for whom they may act as agents. If any broker-
dealer purchases the securities as principal, it may effect resales of the
securities from time to time to or through other broker-dealers, and other
broker-dealers may receive compensation in the form of concessions or
commissions from the purchasers of securities for whom they may act as agents.
10
<PAGE>
To the extent required, the names of the specific managing underwriter or
underwriters, if any, as well as other important information, will be set forth
in prospectus supplements. In such event, the discounts and commissions we will
allow or pay to the underwriters, if any, and the discounts and commissions the
underwriters may allow or pay to dealers or agents, if any, will be set forth
in, or may be calculated from, the prospectus supplements.
Any underwriters, brokers, dealers and agents who participate in any sale
of the securities may also engage in transactions with, or perform services for,
us or our affiliates in the ordinary course of their businesses.
In connection with offerings under this shelf registration, underwriters,
brokers or dealers may over-allot or effect transactions that stabilize or
maintain the market place of the securities at levels above those which might
otherwise prevail in the open market. Such transactions may be effected on the
New York Stock Exchange, in the over-the-counter market or otherwise. Such
stabilizing, if commenced, may be discontinued at any time.
LEGAL MATTERS
Vinson & Elkins L.L.P. will pass upon the validity of the securities
offered under this registration statement.
EXPERTS
The consolidated financial statements as of December 31, 1998 and 1997 and
for each of the three years in the period ended December 31, 1998, incorporated
by reference in this prospectus and elsewhere in the registration statement have
been audited by Arthur Andersen LLP, independent public accountants, as
indicated in their report thereto, and are included herein in reliance upon
their authority as experts in accounting and auditing in giving their report.
11
<PAGE>
________________________________________________________________________________
[LOGO]
Debt Securities
Common Stock
Preferred Stock
Depositary Shares
Warrants
Patina Oil & Gas Corporation
__________________
PROSPECTUS
__________________
________________________________________________________________________________
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
We estimate that we will incur the following expenses in connection with
the issuance and distribution of the securities registered.
<TABLE>
<CAPTION>
<S> <C>
Filing Fee for Registration Statement $ 41,700
Legal Fees and Expenses 150,000
Accounting Fees and Expenses 25,000
Printing Expenses 40,000
Miscellaneous 60,000
--------
Total $316,700
========
</TABLE>
Item 15. Indemnification of Officers and Directors
Under Section 145 of the Delaware General Corporation Law (the "DGCL"), a
Delaware corporation has the power, under specified circumstances, to indemnify
its directors, officers, employees and agents in connection with threatened,
pending or completed actions, suits or proceedings, whether civil, criminal,
administrative or investigative (other than an action by or in right of the
corporation), brought against them by reason of the fact that they were or are
such directors, officers, employees or agents, against expenses, judgments,
fines and amounts paid in settlement actually and reasonably incurred in any
such action, suit or proceeding because such person is or was an officer or
director of the company or is a person who is or was serving at the request of
the company as a director, officer, employee or agent of another corporation or
of a partnership, joint venture, trust or other enterprise, including service
relating to employee benefit plans, to the fullest extent permitted by the DGCL
as it existed at the time the indemnification provisions of a company's
Certificate of Incorporation and the Bylaws were adopted or as may be thereafter
amended. Each of Article VI of our Bylaws and Article Nine of our Certificate
of Incorporation expressly provide that it is not the exclusive method of
indemnification.
Article VI of our Bylaws also provides that we may maintain insurance, at
our expense, to protect us and any director, officer, employee or agent of ours
or of another entity against any expense, liability or loss, regardless of
whether we would have the power to indemnify such person against such expense,
liability or loss under the DGCL.
Section 102(b)(7) of the DGCL provides that a certificate of incorporation
may contain a provision eliminating or limiting the personal liability of a
director to the corporation or its stockholders for monetary damages for breach
of fiduciary duty as a director provided that such provision shall not eliminate
or limit the liability of a director (i) for any breach of the director's duty
of loyalty to the corporation or its stockholders, (ii) for acts or omissions
not in good faith or that involve intentional misconduct or a knowing violation
of law, (iii) under Section 174 of the DGCL (relating to liability for
unauthorized acquisitions or redemptions of, or dividends on, capital stock) or
(iv) for any transaction from which the director derived an improper personal
benefit. Article Eight of our Certificate of Incorporation contains such a
provision.
We have entered into indemnification agreements with each of our officers
and directors and may in the future enter into such indemnification agreements
with our directors, officers, employees and agents. These indemnification
agreements provide a contractual right to indemnification, to the extent
permitted by law, for expenses (including attorneys' fees and disbursements),
judgments, penalties, fines and amounts paid in settlement actually and
reasonably incurred by the person to be indemnified in connection with any
proceeding (including, to the extent permitted by law, any derivative action) to
which they are, or are threatened to be made, a party by reason of their status
in such positions. These indemnification agreements do not change the basic
legal standards for indemnification set forth in the DGCL or in our Certificate
of Incorporation. We have furthered, not limited, the general right to
indemnification provided in our Certificate of Incorporation and Bylaws.
<PAGE>
Item 16. Exhibits.
*5.1 Legal Opinion of Vinson & Elkins L.L.P.
*12.1 Computation of Ratio of Earnings to Fixed Charges and Combined Fixed
Charges and Preferred Stock Dividends
*23.1 Consent of Arthur Andersen LLP
23.2 Consent of Vinson & Elkins L.L.P. (included in the opinion filed as
Exhibit 5.1 to this registration statement)
24.1 Powers of Attorney of Directors and Officers of Patina Oil & Gas
Corporation (included in signature page to this registration
statement)
___________________
*Filed herewith.
Item 17. Undertakings.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) To include any prospectus required in Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent post-
effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
registration statement;
(iii) To include any material information with respect to the "Plan
of Distribution" not previously disclosed in the registration statement or
any material change to such information in the registration statement;
provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by Patina Oil & Gas
Corporation pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in the registration
statement;
(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof;
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering; and
(4) That, for purposes of determining any liability under the Securities
Act of 1933, each filing of Patina Oil & Gas Corporation's annual report
pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of
1934 that is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the provisions described under Item 15 above, or
otherwise, the registrant has been advised that in the opinion of the SEC such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses incurred
or paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
The undersigned registrants hereby undertake to file an application for the
purpose of determining the eligibility of the trustee to act under subsection
(a) of Section 310 of the Trust Indenture Act of 1939 in accordance with the
rules and regulations prescribed by the SEC under Section 305(b)(2) of the Trust
Indenture Act of 1939.
<PAGE>
Signatures
Pursuant to the requirements of the Securities Act of 1933, as amended, the
registrant has duly caused this registration statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on
the 5th day of May, 1999.
PATINA OIL & GAS CORPORATION
(A Delaware Corporation)
By: /s/ Thomas J. Edelman
------------------------
Name: Thomas J. Edelman
----------------------
Title: Chairman of the Board
---------------------
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Brian J. Cree and David J. Kornder, or either of
them, his true and lawful attorney-in-fact and agent, with full power of
substitution, for him and in his name, place and stead, in any and all
capacities, to sign this registration statement and any and all amendments
(including post-effective amendments) to this registration statement, and to
file the same with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorney-in-fact and agent full power and authority to do and perform each and
every act and thing requisite and ratifying and confirming all that said
attorney-in-fact and agent or his substitute or substitutes may lawfully do or
cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement or amendment has been signed by the following persons in
the capacities indicated on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
<S> <C> <C>
/s/ Thomas J. Edelman Chairman of the Board May 5, 1999
- ---------------------------------------------- (Principal Executive Officer)
Thomas J. Edelman
/s/ Jay W. Decker President and Director May 5, 1999
- ----------------------------------------------
Jay W. Decker
/s/ Brian J. Cree Director, Executive Vice President and May 5, 1999
- ---------------------------------------------- Chief Operating Officer
Brian J. Cree
/s/ David J. Kornder Vice President and Chief Financial Officer May 5, 1999
- ----------------------------------------------
David J. Kornder
/s/ Christopher C. Behrens Director May 5, 1999
- ----------------------------------------------
Christopher C. Behrens
/s/ Robert J. Clark Director May 5, 1999
- ----------------------------------------------
Robert J. Clark
/s/ Thomas R. Denison Director May 5, 1999
- ----------------------------------------------
Thomas R. Denison
/s/ Elizabeth K. Lanier Director May 5, 1999
- ----------------------------------------------
Elizabeth K. Lanier
/s/ Alexander P. Lynch Director May 5, 1999
- ----------------------------------------------
Alexander P. Lynch
</TABLE>
<PAGE>
Index To Exhibits
*5.1 Legal Opinion of Vinson & Elkins L.L.P.
*12.1 Computation of Ratio of Earnings to Fixed Charges and Combined
Fixed Charges and Preferred Stock Dividends
*23.1 Consent of Arthur Andersen LLP
23.2 Consent of Vinson & Elkins L.L.P. (included in the opinion filed as
Exhibit 5.1 to this registration statement)
24.1 Powers of Attorney of Directors and Officers of Patina Oil & Gas
Corporation (included in signature page to this registration
statement)
___________________
*Filed herewith.
<PAGE>
EXHIBIT 5.1
[VINSON & ELKINS L.L.P. LETTERHEAD]
(713) 758-2222 (713) 615-5605
May 4, 1999
Patina Oil & Gas Corporation
1625 Broadway
Denver, Colorado 80202
Patina Oil & Gas Corporation
Registration Statement on Form S-3
Debt Securities
Common Stock
Preferred Stock
Depositary Shares
Warrants
Ladies and Gentlemen:
We have acted as counsel for Patina Oil & Gas Corporation, a Delaware
corporation (the "Company"), in connection with the registration under the
Securities Act of 1933 (the "Securities Act"), on a Registration Statement on
Form S-3 (the "Registration Statement") of the offer and sale from time to time
pursuant to Rule 415 under the Securities Act of the following securities for an
aggregate initial offering price not to exceed $150,000,000: (i) shares of
common stock, par value $.01 per share, of the Company ("Common Stock"); (ii)
shares of preferred stock, par value $.01 per share, of the Company ("Preferred
Stock"); (iii) debt securities of the Company ("Debt Securities"); (iv)
depositary shares representing fractional interests in Preferred Stock
("Depositary Shares"); and (v) warrants to purchase Debt Securities, Preferred
Stock or Common Stock (the "Warrants") (together the "Securities").
For purposes of rendering the opinions contained in this letter, we have
reviewed agreements, records and documents as we have deemed relevant in order
to render the opinions set forth herein, including but not limited to the
Certificate of Incorporation and the Bylaws of the Company.
As to certain questions of fact material to our opinions that we have not
independently established, we have relied upon certificates from officers of the
Company and upon certificates of public officials.
In rendering the following opinions, we have assumed (a) all information
contained in all documents reviewed by us is true and correct, (b) the
genuineness of all signatures on all documents reviewed by us, (c) the
authenticity and completeness of all documents submitted to us as originals, (d)
the conformity to authentic originals of all documents submitted to us as
certified or photostatic copies, (e) each natural person signing any document
reviewed by us had the legal capacity to do so, and (f) each person signing in a
representative capacity any document reviewed by us had authority to sign in
such capacity.
Based on the foregoing, and subject to the assumptions, exceptions and
qualifications stated below, we are of the opinion that:
1. With respect to Debt Securities, when (a) the indenture has been duly
authorized and validly executed and delivered by the Company to the trustee, (b)
the indenture has been duly qualified under the Trust Indenture Act of 1939, (c)
the Company's Board of Directors or, to the extent permitted by Section 141(c)
of the General Corporation Law of the State of Delaware, a duly constituted and
acting committee thereof (such Board of Directors or committee being hereinafter
referred to as the "Board") has taken all necessary corporate action to approve
the issuance and terms of such Debt Securities, the terms of the offering
thereof and related matters, and (d) such Debt Securities have been duly
executed, authenticated, issued and delivered in accordance with the provisions
of the indenture and the applicable definitive purchase, underwriting or similar
agreement approved by the Board upon payment of the consideration therefor
provided for therein, such Debt Securities will be legally issued and will
constitute valid and binding obligations of the Company, enforceable against the
Company in accordance with their terms.
<PAGE>
2. With respect to shares of Common Stock, when both (a) the Board has
taken all necessary corporate action to approve the issuance of and the terms of
the offering of the shares of Common Stock and related matters and (b)
certificates representing the shares of Common Stock have been duly executed,
countersigned, registered and delivered either (i) in accordance with the
applicable definitive purchase, underwriting or similar agreement approved by
the Company's Board upon payment of consideration therefor (not less than the
par value of the Common Stock) provided for therein or (ii) upon conversion or
exercise of any other Security, in accordance with the terms of such Security or
the instrument governing such Security providing for such conversion or exercise
as approved by the Board, for the consideration approved by the Board (not less
than the par value of the Common Stock), then the shares of Common Stock will be
legally issued, fully paid and non assessable.
3. With respect to shares of Preferred Stock, when both (a) the Board has
taken all necessary corporate action to approve the issuance and terms of the
shares of Preferred Stock, the terms of the offering thereof, and related
matters, including the adoption of a Certificate of Designation relating to such
Preferred Stock (a "Certificate") and the filing of the Certificate with the
Secretary of State of the State of Delaware, and (b) certificates representing
the shares of Preferred Stock have been duly executed, countersigned, registered
and delivered either (i) in accordance with the applicable definitive purchase,
underwriting or similar agreement approved by the Board upon payment of the
consideration therefor (not less than the par value of the Preferred Stock)
provided for therein or (ii) upon conversion or exercise of any other Security,
in accordance with the terms of such Security or the instrument governing such
Security providing for such conversion or exercise as approved by the Board, for
the consideration approved by the Board (not less than the par value of the
Preferred Stock), then the shares of Preferred Stock will be legally issued,
fully paid and non assessable.
4. With respect to Depositary Shares, when (a) the Board has taken all
necessary corporate action to approve the issuance and terms of the Depositary
Shares, the terms of the offering thereof, and related matters, including the
adoption of a Certificate relating to the Preferred Stock underlying such
Depositary Shares and the filing of the Certificate with the Secretary of State
of the State of Delaware, (b) the Depositary Agreement or Agreements relating to
the Depositary Shares and the related Depositary Receipts have been duly
authorized and validly executed and delivered by the Company and the Depositary
appointed by the Company, (c) the shares of Preferred Stock underlying such
Depositary Shares have been deposited with a bank or trust company (which meets
the requirements for the Depositary set forth in the Registration Statement)
under the applicable Depositary Agreements, and (d) the Depositary Receipts
representing the Depositary Shares have been duly executed, countersigned,
registered and delivered in accordance with the appropriate Depositary Agreement
and the applicable definitive purchase, underwriting or similar agreements
approved by the Board upon payment of the consideration therefore provided for
therein, the Depositary Shares will be legally issued.
5. With respect to the Warrants, when (a) the Board has taken all
necessary corporate action to approve the creation of and the issuance and terms
of the Warrants, the terms of the offering thereof, and related matters (b) the
warrant agreement or agreements relating to the Warrants have been duly
authorized and validly executed and delivered by the Company and the warrant
agent appointed by the Company, and (c) the Warrants or certificates
representing the Warrants have been duly executed, countersigned, registered and
delivered in accordance with the appropriate warrant agreement or agreements and
the applicable definitive purchase, underwriting or similar agreement approved
by the Company's Board upon payment of the consideration therefor provided for
therein, the Warrants will be legally issued.
The opinions expressed above are subject in all respects to the following
assumption, exceptions and qualifications:
a. We have assumed that (a) the Registration Statement and any amendments
thereto (including post-effective amendments) will have become effective and
comply with all applicable laws; (b) the Registration Statement will be
effective and will comply with all applicable laws at the time the Securities
are offered or issued as contemplated by the Registration Statement (if such
offering or issuance requires the delivery of a prospectus under the Securities
Act or pursuant to any other law); (c) a prospectus supplement will have been
prepared and filed with the Securities and Exchange Commission describing the
Securities offered thereby and will comply with all applicable laws; (d) all
Securities will be issued and sold in compliance with applicable federal and
state securities laws and in the manner stated in the Registration Statement and
the appropriate prospectus supplement; (e) a definitive purchase, underwriting
or similar agreement with respect to any Securities offered or issued will have
been duly authorized and validly executed and delivered by the Company and the
other parties thereto; and (f) any Securities issuable upon conversion, exchange
or exercise of any Security being offered or issued will be duly authorized,
created and, if appropriate, reserved for issuance upon such conversion,
exchange or exercise.
b. In rendering the opinion in paragraph 1, we have assumed that
the trustee is or, at the time an indenture is signed, will be qualified to act
as trustee under the indenture and that the trustee has or will have duly
executed and delivered the indenture.
c. The enforceability of the indenture and provisions thereof may be
limited by bankruptcy, insolvency, reorganization, fraudulent transfer,
moratorium or other similar laws now or hereinafter in effect relating to or
affecting enforcement of creditors'
<PAGE>
rights generally and by general principles of equity (regardless of whether such
enforcement is considered in a proceeding in equity or at law). Such principles
or equity include, without limitation, concepts of materiality, reasonableness,
good faith and fair dealing, and also to the possible unavailability of specific
performance or injunctive relief.
d. We express no opinion with respect to (a) the enforceability of any
provision in any agreement or instrument with respect to delay or omission of
enforcement of rights or remedies, or waivers of notices or defenses, or waivers
of benefits of, or other rights that cannot be effectively waived under,
applicable laws or (b) the enforceability of indemnification provisions to the
extent they purport to relate to liabilities resulting from or based upon
negligence or any violation of federal or state securities or blue sky laws.
e. We note that the terms of an indenture, the warrants or other
agreements, when determined, may be governed by the laws of a jurisdiction other
than the State of Texas or other than the General Corporation Law of the State
of Delaware. While we express no opinion with respect to the laws of the State
of New York or such other jurisdictions in rendering these opinions, we have
assumed that the internal laws of the State of New York and such other
jurisdictions are the same as the internal laws of the State of Texas. We have
not conducted any analysis to determine whether that assumption is correct.
f. The opinions expressed in this letter are limited to the laws of the
State of Texas, the General Corporation Law of the State of Delaware, and the
federal laws of the United States of America.
We consent to the filing of this opinion of counsel as Exhibit 5.1 to the
Registration Statement. We also consent to the reference to this firm under the
heading "Legal Matters" in the prospectus forming a part of the Registration
Statement. In giving this consent, we do not admit that this firm is in the
category of persons whose consent is required under Section 7 of the Securities
Act or the rules and regulations of the Securities and Exchange Commission
promulgated thereunder.
This opinion is rendered on the date hereof and we disclaim any duty to
advise you regarding any changes in the matters addressed herein.
Very truly yours,
/s/ VINSON & ELKINS L.L.P.
<PAGE>
EXHIBIT 12.1
COMPUTATION OF RATIOS OF EARNINGS TO FIXED CHARGES AND
EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
(UNAUDITED)
(dollars in thousands, except ratios)
<TABLE>
<CAPTION>
1994 1995 (a) 1996 1997 (a) 1998 (a)
------ --------- ------- ---------- ---------
<S> <C> <C> <C> <C> <C>
Net income (loss) before taxes $4,539 $(3,222) $ 3,168 $(16,903) $(4,524)
Interest expense 3,869 5,409 14,275 15,939 12,867
------ ------- ------- -------- -------
Earning before fixed charges 8,408 2,187 17,443 (964) 8,343
====== ======= ======= ======== =======
Fixed charges:
Interest expense 3,869 5,409 14,275 15,939 12,867
Total fixed charges 3,869 5,409 14,275 15,939 12,867
====== ======= ======= ======== =======
Ratio of earnings to fixed charges 2.17 0.40 1.22 (0.06) 0.65
====== ======= ======= ======== =======
Net income (loss) before taxes $4,539 $(3,222) $ 3,168 $(16,903) $(4,524)
Interest expense 3,869 5,409 14,275 15,939 12,867
------ ------- ------- -------- -------
Earning before fixed charges 8,408 2,187 17,443 (964) 8,343
====== ======= ======= ======== =======
Preferred stock dividends -- -- 2,129 3,346 6,335
Ratio of pretax income to net income 1.54 1.54 0.89 1.00 1.00
------ ------- ------- -------- -------
Preferred stock dividend factor -- -- 1,895 3,346 6,335
Fixed charges:
Interest expense 3,869 5,409 14,275 15,939 12,867
------ ------- ------- -------- -------
Preferred stock dividend factor -- -- 1,895 3,346 6,335
Total fixed charges and preferred
Stock dividends 3,869 5,409 16,170 19,285 19,202
====== ======= ======= ======== =======
Ratio of earnings to combined fixed
Charges and preferred stock dividends 2.17 0.40 1.08 (0.05) 0.43
====== ======= ======= ======== =======
</TABLE>
a. The ratio indicates a less than one-to-one coverage because the earnings
were inadequate to cover the fixed charges for the period. Our historical
earnings for the years ended December 31, 1995, 1997 and 1998 were insufficient
to cover our fixed charges. The amounts of the deficiencies were $3.2 million,
$16.9 million and $4.5 million respectively, for the ratio of earnings to fixed
charges and $3.2 million, $20.2 million and $10.9 million respectively, for the
ratio of earnings to combined fixed charges and preferred stock dividends.
<PAGE>
EXHIBIT 23.1
ARTHUR ANDERSEN LLP
Arthur Andersen LLP
___________________
Denver, Colorado
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation
by reference in this registration statement of our report dated February 12,
1999 included in Patina Oil & Gas Corporation's Form 10-K for the year ended
December 31, 1998 and to all references to our Firm included in this
registration statement.
/s/ ARTHUR ANDERSEN LLP
Denver, Colorado
May 4, 1999
