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SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of
1934
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
Harken Energy Corporation
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(Name of Registrant as Specified In Its Charter)
Harken Energy Corporation
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(Name of Persons(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[ ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2).
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[x] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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<PAGE> 2
HARKEN ENERGY CORPORATION
5605 N. MACARTHUR BOULEVARD, SUITE 400
IRVING, TEXAS 75038
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD DECEMBER 10, 1996
Notice is hereby given that a Special Meeting of Stockholders (the
"Special Meeting") of Harken Energy Corporation, a Delaware corporation
("Harken"), will be held at the Adams Mark Hotel at 2900 Briar Park, Houston,
Texas 77042, on Tuesday, December 10, 1996, at 7:00 a.m., local time, for the
following purposes:
(1) To approve an amendment to Harken's Certificate of
Incorporation increasing the number of authorized shares of
common stock, $.01 par value per share (the "Common Stock"),
from 125,000,000 to 150,000,000;
(2) To transact such other business as may properly be brought
before the Special Meeting or any adjournment or postponement
thereof.
The Board of Directors has fixed the close of business on October 24,
1996 as the date of record for determining the stockholders entitled to notice
of and to vote, either in person or by proxy, at the Special Meeting and any
adjournment or postponement thereof.
A Proxy Statement containing information relating to the matters to be
acted upon at the Special Meeting and a form of Proxy accompany this Notice.
You are cordially invited to attend the Special Meeting. WHETHER OR
NOT YOU PLAN TO ATTEND, YOU ARE URGED TO DATE, SIGN AND PROMPTLY RETURN YOUR
PROXY SO THAT YOUR SHARES MAY BE VOTED IN ACCORDANCE WITH YOUR WISHES AND IN
ORDER THAT THE PRESENCE OF A QUORUM MAY BE ASSURED. The giving of such proxy
does not affect your right to revoke it later or vote your shares in person if
you should attend the Special Meeting.
By Order of the Board of Directors
Larry E. Cummings
Secretary
Irving, Texas
October 28, 1996
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HARKEN ENERGY CORPORATION
5605 N. MACARTHUR BOULEVARD, SUITE 400
IRVING, TEXAS 75038
PROXY STATEMENT
FOR
SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD DECEMBER 10, 1996
SOLICITATION OF PROXIES
The accompanying proxy is solicited on behalf of the Board of
Directors of Harken Energy Corporation, a Delaware corporation ("Harken"), in
connection with a Special Meeting of Stockholders (the "Special Meeting"),
which will be held at the Adams Mark Hotel at 2900 Briar Park, Houston, Texas
77042, on Tuesday, December 10, 1996, at 7:00 a.m., local time, and at any
adjournments or postponements thereof, for the purposes set forth in the
accompanying notice. This Proxy Statement and the accompanying Proxy will
first be mailed to stockholders of record on or about October 28, 1996.
RECORD DATE AND VOTING SECURITIES
The Board of Directors has fixed the close of business on October 24,
1996 as the Record Date (herein so called) for determining the holders of
common stock, $.01 par value per share, of Harken ("Common Stock") entitled to
notice of and to vote, either in person or by proxy, at the Special Meeting.
The shares of Common Stock are the only shares of capital stock entitled to
vote at the Special Meeting. On October 24, 1996, Harken had 93,345,476 shares
of Common Stock outstanding.
QUORUM AND VOTING
The presence, in person or by proxy, of the holders of a majority of
the outstanding shares of Common Stock entitled to vote is necessary to
constitute a quorum at the Special Meeting. Abstentions and broker non-votes
are counted for purposes of determining whether a quorum is present. If a
quorum is not present or represented by proxy, the stockholders entitled to
vote thereat, present in person or represented by proxy, have the power to
adjourn the meeting from time to time, without notice other than an
announcement at the meeting until a quorum is present or represented. At any
such adjourned meeting at which a quorum is presented or represented, any
business may be transacted that might have been transacted at the meeting as
originally called.
On all matters submitted to a vote of the stockholders at the Special
Meeting or any adjournment thereof, each stockholder will be entitled to one
vote for each share of Common Stock owned of record by such stockholder at the
close of business on October 24, 1996.
Abstentions and broker non-votes will be treated as a vote against the
proposed amendment to Harken's Certificate of Incorporation.
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ACTIONS TO BE TAKEN UNDER THE PROXY
Proxies which are properly executed and returned will be voted at the
meeting and any adjournment thereof in accordance with the instructions
thereon. Any proxy upon which no instructions have been indicated will be
voted FOR approval of an amendment to Harken's Certificate of Incorporation
increasing the authorized number of shares of Common Stock from 125,000,000 to
150,000,000.
Harken knows of no other matters, other than the amendment to Harken's
Certificate of Incorporation, to be presented for consideration at the meeting.
If, however, other matters properly come before the meeting or any adjournments
thereof, it is the intention of the persons named in the accompanying proxy to
vote such proxy in accordance with their judgement on any such matters. The
persons named in the accompanying proxy may also, if it is deemed advisable,
vote such proxy to adjourn the meeting from time to time.
PROXY SOLICITATION
The expense of the solicitation of proxies will be borne by Harken.
Solicitation of proxies may be made in person or by mail, telephone or
telegraph by directors, executive officers and other employees of Harken.
Harken will request banking institutions, brokerage firms, custodians, nominees
and fiduciaries to forward solicitation material to the beneficial owners of
Common Stock held of record by such persons, and Harken will reimburse such
entities for their reasonable out-of-pocket expenses. Harken has retained the
services of Georgeson & Company, Inc. to solicit proxies by mail, telephone,
telegraph or personal contact. The estimated cost of the professional
solicitation will be approximately $8,500 plus out-of-pocket expenses.
REVOCATION OF PROXY
Any stockholder returning the accompanying proxy may revoke such proxy
at any time prior to its exercise (a) by giving written notice to the Secretary
of Harken of such revocation; (b) by voting in person at the meeting; or (c)
by executing and delivering to the Secretary of Harken a later dated proxy.
PROPOSAL: INCREASE IN AUTHORIZED CAPITAL STOCK
Harken's Certificate of Incorporation authorizes the issuance of up to
125,000,000 shares of Common Stock. The proposed amendment to Harken's
Certificate of Incorporation would amend the first paragraph of Article Four of
the Certificate of Incorporation to increase the number of authorized shares of
Common Stock from 125,000,000 shares to 150,000,000 shares. The text of this
amended first paragraph of Article Four is set forth below:
"The aggregate number of shares which the Corporation shall
have the authority to issue is one hundred sixty million
(160,000,000), of which one hundred fifty million (150,000,000) shall
be designated as Common Stock of the par value of One Cent ($.01) per
share and ten million (10,000,000) shall be designated as Preferred
Stock of the par value of One Dollar ($1.00) per share."
At October 24, 1996, 93,345,476 shares of Common Stock were issued and
outstanding and an additional 28,910,044 shares of Common Stock were reserved
for future issuance, including issuance in connection with Harken's outstanding
stock options, outstanding warrants and Harken's 6.5% Senior Convertible Notes
which are convertible into Common Stock, leaving a balance of 2,744,480 shares
of Common Stock available for other purposes. The Board of Directors believes
that it is in the best interest of Harken to increase the authorized number of
shares of Common Stock at this time. If the amendment to Harken's Certificate
of Incorporation is adopted by the stockholders at the Special Meeting, Harken
will have 27,744,480 shares of Common Stock available for issuance in addition
to the shares of
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Common Stock currently reserved for future issuance. Although Harken has not
made any decision respecting the issuance of additional shares of Common Stock,
the Board of Directors believes that the proposed amendment to the Certificate
of Incorporation will provide Harken with the additional flexibility for
possible future financing transactions, acquisitions, employee benefit plans,
and other corporate purposes.
Harken currently controls approximately 1,000,000 acres in Colombia
through four separate Association Contracts with the Colombian state-owned oil
company. Exploration and development of such acreage will require a
substantial amount of funds, the exact amount of which cannot presently be
determined. One potential method of raising such funds is through the issuance
of additional shares of Common Stock or securities convertible into Common
Stock. Harken, however, does not have any agreements or understandings
regarding the issuance of any additional shares of Common Stock.
In addition, a principal strategy of Harken is to pursue opportunities
for expansion through acquisitions. Although Harken continues to review
numerous acquisition opportunities, Harken does not currently have any
agreements or understandings regarding any possible future acquisitions which
would require Harken to issue any shares of Common Stock. It is possible,
however, that prior to the date of the Special Meeting, Harken may reach
agreement on one or more acquisitions which could result in the issuance of up
to 2,500,000 shares of Common Stock (which amount is less than the available
number of unissued and unreserved shares of Common Stock). Harken does not
anticipate that such acquisitions individually or in the aggregate would be
material.
The Board of Directors believes that it is desirable to have
additional authorized shares of Common Stock available for issuance in
connection with possible future acquisitions or financing transactions.
Having additional authorized shares of Common Stock available for issuance
provides Harken with greater flexibility should opportunities arise that
require prompt action and may allow such shares to be issued without the delay
and expense of seeking stockholder approval each time. Further authorization
for the issuance of such Common Stock by a vote of the stockholders would not
be solicited prior to such issuance unless required by law or regulation of
applicable authority. In the event that shares of such Common Stock were
issued, other than pursuant to a stock split or stock dividend, the percentage
ownership of Harken of each stockholder would be proportionately reduced. No
other rights of stockholders would be affected. Stockholders have no
preemptive right to subscribe for or purchase any additional shares of Common
Stock issued by Harken.
VOTE REQUIRED TO APPROVE AMENDMENT TO HARKEN'S CERTIFICATE OF INCORPORATION
The adoption of the proposal to amend Harken's Certificate of
Incorporation to increase the authorized number of shares of Common Stock
requires the affirmative vote of the holders of a majority of the issued and
outstanding shares of Common Stock entitled to vote.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE APPROVAL OF AN
AMENDMENT TO HARKEN'S CERTIFICATE OF INCORPORATION TO INCREASE THE NUMBER OF
AUTHORIZED SHARES OF COMMON STOCK.
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OWNERSHIP OF COMMON STOCK
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table sets forth information regarding each person who
is known by Harken to beneficially own five percent (5%) or more of the
outstanding shares of Common Stock as of October 24, 1996. Unless otherwise
indicated, such persons have sole voting and investment power with respect to
such shares and all such shares are owned beneficially and of record by the
person indicated.
<TABLE>
<CAPTION>
Amount of Beneficial
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Name and Address of Beneficial Owner Ownership Percent of Class
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<S> <C> <C>
Aeneas Venture Corporation 9,085,723 (1) 9.73 %
Phemus Corporation
Harvard Master Trust
Harvard Yenching Institute
c/o Harvard Management Company, Inc.
600 Atlantic Ave., 26th Floor
Boston, Massachusetts 02210-2203
Abdullah Taha Bakhsh 6,735,364 (2) 7.22 %
% Traco International, N.V.
P. O. Box 459
Jeddah, Saudi Arabia
</TABLE>
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(1) All shares of Common Stock beneficially owned by Aeneas Venture
Corporation ("Aeneas"), Phemus Corporation ("Phemus"), Harvard Master
Trust and Harvard Yenching Institute have been aggregated together as
such entities may be considered a group for purposes of Rule 13d-5
promulgated under the Securities and Exchange Act of 1934. Such
amount also includes 25,000 shares of Common Stock issuable upon the
exercise of options at an exercise price of $5.625 per share, which
options were transferred to Aeneas from Michael R. Eisenson, a
director of Harken, effective April 1, 1991. Aeneas and Phemus are
wholly-owned subsidiaries of the President and Fellows of Harvard
College ("Harvard") which assist in the management of the Harvard
University endowment fund. Michael R. Eisenson is the President and
Chief Executive Officer of Harvard Private Capital Group, Inc. ("HPC")
which is a wholly-owned subsidiary of Harvard Management Company, Inc.
("HMC") and the investment advisor for Aeneas and Phemus. Although
Mr. Eisenson has primary investment responsibility for the Aeneas and
Phemus shares, he does not possess either sole investment or sole
voting power over the shares. Instead, Mr. Eisenson shares such
authority with Jack Meyer, President and Chief Executive Officer of
HMC. Investment and voting power over the Harvard Master Trust and
Harvard-Yenching Institute shares is shared by Jane Mendillo, Jack
Meyer and Verne Sedlacek.
(2) Includes shares of Common Stock owned of record by Traco
International, NV ("Traco") and Atherstone Corporation NV
("Atherstone"). Traco is wholly-owned by Mr. Bakhsh, and Atherstone
is indirectly owned by Mr. Bakhsh. The basis for certain of this
information is Amendment 8 to Schedule 13D filed with the Securities
and Exchange Commission (the "Commission") on August 7, 1992 by
Abdullah Taha Bakhsh.
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SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth as of October 24, 1996 information
regarding the number of shares of Common Stock beneficially owned by each
Director, Harken's Chief Executive Officer and Harken's four most highly
compensated executive officers other than the Chief Executive Officer during
1995, and all of Harken's Directors and executive officers as a group.
<TABLE>
<CAPTION>
Amount of Shares
Beneficial Subject to Percent
Name Ownership (1) Options (2) of Class
---- ------------- ----------- ---------
<S> <C> <C> <C>
Michael M. Ameen, Jr. 11,000 3,750 (5)
Larry E. Cummings 172,239 152,564 (5)
Michael R. Eisenson 8,383,152 (3) 25,000 8.98%
Mikel D. Faulkner 562,329 559,992 (5)
Bruce N. Huff 187,500 187,500 (5)
Talat M. Othman 25,000 0 (5)
Donald W. Raymond 242,500 0 (5)
Richard H. Schroeder 268,750 268,750 (5)
Stephen C. Voss 177,500 177,500 (5)
Gary B. Wood 108,305 (4) 2,500 (5)
All Directors and Executive 10,169,525 1,411,806 10.73%
Officers as a Group (13 Persons)
</TABLE>
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(1) Includes shares that may be acquired through the exercise of certain
options.
(2) Includes shares issuable upon exercise of currently exercisable
options and options exercisable within 60 days of October 24, 1996.
(3) Includes 8,036,473 shares of Common Stock held of record by Aeneas and
321,679 shares of Common Stock held of record by Phemus.
(4) Includes 47,858 shares owned by Concorde Financial Corporation, which
is 90% owned by Dr. Wood.
(5) Less than one percent (1%)
5
<PAGE> 8
STOCKHOLDER PROPOSALS FOR 1997 ANNUAL MEETING
Any stockholder desiring to present a proposal to the stockholders at
the 1997 Annual Meeting of Stockholders, which currently is expected to be
scheduled in June 1997, must transmit such proposal to Harken so that it is
received by Harken at its principal executive offices to the attention of the
Secretary of Harken on or before December 24, 1996. All such proposals should
be in compliance with applicable Securities and Exchange Commission
regulations.
By Order of the Board of Directors
Larry E. Cummings,
Secretary
Irving, Texas
October 28, 1996
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HARKEN ENERGY CORPORATION
PROXY SOLICITED BY THE BOARD OF DIRECTORS
FOR THE SPECIAL MEETING OF STOCKHOLDERS TO BE HELD DECEMBER 10, 1996
The undersigned hereby (1) acknowledges receipt of the Notice of Special
Meeting of Stockholders of Harken Energy Corporation ("Harken") to be held
December 10, 1996, and (2) constitutes and appoints Mikel D. Faulkner, Bruce N.
Huff and Larry E. Cummings, and each of them, attorneys and proxies of the
undersigned, with full power of substitution to each, for and in the name,
place, and stead of the undersigned, to vote, and to act in accordance with the
instructions set forth below with respect to, all of the shares of Common Stock
of Harken standing in the name of the undersigned or with respect to which the
undersigned is entitled to vote and act at that meeting and at any meetings to
which that meeting is adjourned. In their discretion, the proxies may vote upon
such other matters as may properly come before the meeting.
Approval of an amendment to Harken's Certificate of Incorporation increasing
the authorized number of shares of Common Stock from 125,000,000 to 150,000,000.
/ / FOR / / AGAINST / / ABSTAIN
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You are encouraged to specify your choices by marking the appropriate boxes
(SEE REVERSE SIDE), but you need not mark any boxes if you wish to vote in
accordance with the Board of Directors' recommendations. This Proxy will be
voted as specified. If no specification is made this Proxy will be voted FOR the
proposal. Your shares cannot be voted unless you sign and return this card.
(Change of Address)
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DATED: , 1996
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(Signature)
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(Signature)
NOTE: PLEASE SIGN EXACTLY AS
NAME APPEARS HEREON, JOINT
OWNERS SHOULD EACH SIGN. WHEN
SIGNING AS ATTORNEY, EXECUTOR,
ADMINISTRATOR, TRUSTEE OR
GUARDIAN, PLEASE GIVE FULL
TITLE AS SUCH.
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