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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):
[x] No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) 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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[ ] 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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HARKEN ENERGY CORPORATION
5605 N. MACARTHUR BOULEVARD, SUITE 400
IRVING, TEXAS 75038
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD DECEMBER 16, 1997
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 Westin Hotel Galleria, 13340 Dallas Parkway,
Dallas, Texas 75240, on Tuesday, December 16, 1997, at 9:00 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 150,000,000 to 175,000,000;
(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 31,
1997 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
November 7, 1997
<PAGE> 3
HARKEN ENERGY CORPORATION
5605 N. MACARTHUR BOULEVARD, SUITE 400
IRVING, TEXAS 75038
PROXY STATEMENT
FOR
SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD DECEMBER 16, 1997
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 Westin Hotel Galleria, 13340 Dallas Parkway, Dallas,
Texas 75240, on Tuesday, December 16, 1997, at 9:00 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 November 7, 1997.
RECORD DATE AND VOTING SECURITIES
The Board of Directors has fixed the close of business on October 31,
1997 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 31, 1997, Harken had 119,660,484
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 31, 1997.
Abstentions and broker non-votes will be treated as a vote against the
proposed amendment to Harken's Certificate of Incorporation.
<PAGE> 4
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 150,000,000 to
175,000,000.
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 ChaseMellon Shareholder Services to solicit proxies by mail,
telephone, telegraph or personal contact. The estimated cost of the
professional solicitation will be approximately $6,000 plus out-of-pocket
expenses.
REVOCATION OF PROXY
Any stockholder returning the accompanying proxy may revoke such proxy
at any time prior to its exercise (a) by giving written notice to the Secretary
of Harken of such revocation; (b) by voting in person at the meeting; or (c)
by executing and delivering to the Secretary of Harken a later dated proxy.
PROPOSAL: INCREASE IN AUTHORIZED CAPITAL STOCK
Harken's Certificate of Incorporation authorizes the issuance of up to
150,000,000 shares of Common Stock. The proposed amendment to Harken's
Certificate of Incorporation would amend the first paragraph of Article Four of
the Certificate of Incorporation to increase the number of authorized shares of
Common Stock from 150,000,000 shares to 175,000,000 shares. The text of this
amended first paragraph of Article Four is set forth below:
"The aggregate number of shares which the Corporation shall
have the authority to issue is one hundred eighty-five million
(185,000,000), of which one hundred seventy-five million (175,000,000)
shall be designated as Common Stock of the par value of One Cent
($.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 31, 1997, 119,660,484 shares of Common Stock were issued
and outstanding and an additional 20,885,536 shares of Common Stock were
reserved for future issuance, including issuance in connection with Harken's
outstanding stock options, outstanding warrants and Harken's 5.5% Senior
Convertible Notes which are convertible into Common Stock, leaving a balance of
9,453,980 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
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stockholders at the Special Meeting, Harken will have 34,453,980 shares of
Common Stock available for issuance in addition to the shares of 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 significant acreage in Colombia through
certain 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 which would be in excess of the number
of Harken's currently authorized unissued and unreserved shares.
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 which would be in
excess of the number of Harken's currently authorized unissued and unreserved
shares.
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 and for
general corporate purposes. 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 31, 1997. 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
--------------------
NAME AND ADDRESS OF BENEFICIAL OWNER OWNERSHIP PERCENT OF CLASS
- ------------------------------------ --------- ----------------
<S> <C> <C>
Ryback Management Corporation 9,981,400 (1) 8.34%
7711 Carondelet Avenue
Box 16900
St. Louis, Missouri 63105
Abdullah Taha Bakhsh 6,735,364 (2) 5.63%
c/o Traco International, N.V.
P. O. Box 459
Jeddah, Saudi Arabia
</TABLE>
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(1) Includes shares of Common Stock held by the Lindner Dividend Fund and
shares of Common Stock managed by Ryback Management Corporation. The
basis for certain of this information is an amendment to Schedule 13G
filed with the Securities and Exchange Commission (the "Commission") on
April 25, 1997 by Ryback Management Corporation.
(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 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 31, 1997 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
1996, and all of Harken's Directors and executive officers as a group.
<TABLE>
<CAPTION>
NUMBER OF SHARES PERCENT
NAME BENEFICIALLY OWNED OF CLASS
- ---- ------------------ ---------
<S> <C> <C>
Michael M. Ameen, Jr. 15,500 (1)
Larry E. Cummings 220,989 (2) (1)
Michael R. Eisenson 3,805,514 (3) 3.18%
Mikel D. Faulkner 862,329 (4) (1)
Bruce N. Huff 306,250 (5) (1)
Gary R. Petersen 202,000 (6) (1)
Donald W. Raymond 122,500 (1)
Richard H. Schroeder 525,000 (5) (1)
Hobart A. Smith 44,000 (1)
Stephen C. Voss 296,250 (5) (1)
Gary B. Wood 111,535 (7) (1)
All Directors and Executive 6,633,617 (8) 5.43%
Officers as a Group (14 Persons)
</TABLE>
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(1) Less than one percent (1%).
(2) Includes 191,314 shares issuable upon exercise of options held by Mr.
Cummings which are either exercisable or will be exercisable within 60
days of October 31, 1997.
(3) Includes 3,780,514 shares held by Aeneas Venture Corporation ("Aeneas")
and 25,000 shares issuable upon exercise of options held by Aeneas
which are either exercisable or will be exercisable within 60 days of
October 31, 1997. Although Mr. Eisenson has no direct pecuniary
interest in the shares held by Aeneas, Mr. Eisenson may be deemed to
be the beneficial owner of such shares as a result of his position as
President and Chief Executive Officer of Harvard Private Capital
Group, Inc., the investment advisor for Aeneas.
(4) Includes 859,992 shares issuable upon exercise of options held by Mr.
Faulkner which are either exercisable or will be exercisable within 60
days of October 31, 1997.
(5) Represents shares issuable upon exercise of options which are either
exercisable or will be exercisable within 60 days of October 31, 1997.
(6) Includes 100,000, 75,169 and 24,831 shares issuable upon exercise of
warrants held by EnCap Investments LC ("EnCap"), EnCap Equity 1994
Limited Partnership ("EnCap Equity") and ECIC Corporation ("ECIC"),
respectively. Mr. Petersen may be deemed to beneficially own such
shares as a result of his position as a Managing Director of EnCap
(which is the general partner of EnCap Equity) and director of ECIC.
(7) Includes 47,858 shares held by Concorde Financial Corporation, which
is 90% owned by Dr. Wood.
(8) Includes 2,530,556 shares issuable upon exercise of options or
warrants which are either exercisable or will be exercisable within 60
days of October 31, 1997.
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<PAGE> 8
STOCKHOLDER PROPOSALS FOR 1998 ANNUAL MEETING
Any stockholder desiring to present a proposal to the stockholders at
the 1998 Annual Meeting of Stockholders, which currently is expected to be
scheduled in June 1998, 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, 1997. 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
November 7, 1997
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HARKEN ENERGY CORPORATION
PROXY SOLICITED BY THE BOARD OF DIRECTORS
FOR THE SPECIAL MEETING OF STOCKHOLDERS TO BE HELD DECEMBER 16, 1997
The undersigned hereby (1) acknowledges receipt of the Notice of
Annual Meeting of Stockholders of Harken Energy Corporation ("Harken") to be
held December 16, 1997, 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.
PROPOSAL: Approval of an amendment to Harken's Certificate of
Incorporation increasing the authorizing number of shares of Common
Stock from 150,000,000 to 175,000,000.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
<PAGE> 10
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.
- ------------------------- -------------------------- ------------
(Signature) (Signature) (Date)
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.
