As filed with the Securities and Exchange Commission on August 28, 1995.
Registration No. 33-_______
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
TEXOIL, INC.
(Exact name of registrant as specified in its charter)
NEVADA 88-0177083
(State or Other Jurisdiction (I.R.S. Employer
of Incorporation or Organization) Identification No.)
1600 SMITH STREET, SUITE 4000
HOUSTON, TEXAS 77002
(Address, including Zip Code, of Registrant's Principal Executive Offices)
TEXOIL, INC. 1994 STOCK OPTION PLAN
TEXOIL, INC. 1995 STOCK COMPENSATION PLAN
(Full Title of the Plans)
Name, Address and Telephone Copy of communications to:
Number of Agent for Service:
NICK D. NICHOLAS
WALTER L. WILLIAMS OR NORA J. DOBIN
TEXOIL, INC. PORTER & HEDGES, L.L.P.
1600 SMITH STREET, SUITE 4000 700 LOUISIANA STREET, 35TH FLOOR
HOUSTON, TEXAS 77002 HOUSTON, TEXAS 77002-2764
(713) 652-5741 (713) 226-0600
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
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PROPOSED MAXIMUM PROPOSED
AMOUNT TO OFFERING MAXIMUM AGGREGATE AMOUNT OF
TITLE OF SECURITIES TO BE REGISTERED BE REGISTERED PRICE PER UNIT(1) OFFERING PRICE(1) REGISTRATION FEE(1)
-----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, par value $.01 per share 350,000 $1.8125 $634,375 $219
=============================================================================================================================
</TABLE>
(1) Pursuant to Rule 457(c) and (h), the registration fee is calculated on
the basis of the last sale price for the Common Stock on the NASDAQ
SmallCap Market on August 24, 1995, $1.8125 per share.
<PAGE>
PROSPECTUS
30,620 SHARES
TEXOIL, INC.
COMMON STOCK
The shares of common stock offered hereby are shares of common stock, par
value $.01 per share ("Common Stock"), of Texoil, Inc., a Nevada corporation
(the "Company"), owned by certain stockholders of the Company. See "Selling
Stockholders." The Company will not receive any of the proceeds from the sale of
the Common Stock offered hereby.
The Company's Common Stock trades on the Boston Stock Exchange and NASDAQ
SmallCap Market under the symbol "TXLI." On August 24, 1995, the reported
closing sale price of the Common Stock on the NASDAQ SmallCap Market was $1.8125
per share.
The Common Stock may be offered and sold from time to time by Selling
Stockholders through brokers or dealers or directly to one or more purchasers in
negotiated transactions, at market prices prevailing at the time of sale or at
prices related to such market prices. The Selling Stockholders and brokers
executing selling orders on behalf of the Selling Stockholders may be deemed to
be "underwriters" within the meaning of the Securities Act of 1933, as amended
("Securities Act"), in which event commissions received by such brokers may be
deemed to be underwriting commissions under the Securities Act. Although each
Selling Stockholder may sell all or a portion of the shares of Common Stock
offered hereby, no Selling Stockholder is required to make any such sale. See
"Plan of Distribution" for further information concerning the plan of
distribution of the Common Stock.
The expenses of this offering, estimated at $10,000, will be paid by the
Company.
PROSPECTIVE PURCHASERS OF THE COMMON STOCK OFFERED HEREBY SHOULD CAREFULLY
CONSIDER THE MATTERS SET FORTH UNDER THE CAPTION "RISK FACTORS" ON PAGE 4 OF
THIS PROSPECTUS.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION
OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY
OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
THE DATE OF THIS PROSPECTUS IS AUGUST 28, 1995.
<PAGE>
AVAILABLE INFORMATION
The Company has filed with the Securities and Exchange Commission (the
"Commission") in Washington, D.C., a Registration Statement on Form S-8 under
the Securities Act with respect to the Common Stock offered by this Prospectus.
Certain portions of the Registration Statement have not been included in this
Prospectus. For further information, reference is made to the Registration
Statement and the Exhibits thereto. The Company is subject to the information
requirements of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and in accordance therewith files reports, proxy statements and other
information with the Commission. The Registration Statement (with exhibits), as
well as such reports, proxy statements and other information can be inspected
and copied at the public reference facilities maintained by the Commission at
its principal offices at Judiciary Plaza, 450 Fifth Street, N.W., Washington,
D.C. 20549, and its regional offices at Northwest Atrium Center, 500 Madison
Street, Suite 1400, Chicago, Illinois 60661 and 7 World Trade Center, 13th
Floor, New York, New York 10048. Copies of such material can be obtained at
prescribed rates from the Public Reference Section of the Commission at its
principal office at Judiciary Plaza, 450 Fifth Street, N.W., Room 1024,
Washington, D.C. 20549. Such materials also can be inspected at the offices of
the Boston Stock Exchange, Inc., One Boston Place, Boston, Massachusetts 02108.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company's (i) annual report on Form 10-KSB for the fiscal year ended
December 31, 1994, (ii) quarterly report on Form 10-QSB for the fiscal quarter
ended March 31, 1995, (iii) quarterly report on Form 10-QSB for the fiscal
quarter ended June 30, 1995, (iv) current report on Form 8-K dated July 10,
1995, and (v) the description of the Company's common stock, par value $.01 per
share, set forth under the caption "Description of Registrant's Securities to be
Registered" in the Company's registration statement on Form 8-A, dated February
12, 1994, Commission File No. 1-12834, and any amendment or report filed for the
purpose of updating such description, are hereby incorporated herein by
reference.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14
and 15(d) of the Exchange Act after the date of this Prospectus and before the
termination of the offering covered hereby shall be deemed to be incorporated by
reference in this Prospectus and to be a part hereof from the date of filing of
such documents. Any statement contained in this Prospectus, in any supplement to
this Prospectus or in a document incorporated or deemed to be incorporated by
reference in this Prospectus shall be deemed to be modified or superseded for
purposes of this Prospectus to the extent that a statement contained in this
Prospectus or in any other subsequently filed document which also is or is
deemed to be incorporated by reference modifies or replaces such statement. Any
such statement shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
The Company will provide without charge to each person to whom this
Prospectus is delivered, upon the written or oral request of such person, a copy
of any or all of the documents incorporated by reference in this Prospectus,
other than exhibits to such documents, unless such exhibits are specifically
incorporated by reference into the information that this Prospectus
incorporates. In addition, a copy of the Company's most recent annual report on
Form 10-KSB will be promptly furnished, without charge, upon written or oral
request. All such requests should be directed to Texoil, Inc., 1600 Smith
Street, Suite 4000, Houston, Texas 77002, Attention: Corporate Secretary,
telephone number (713) 652-5741.
2
THE COMPANY
Texoil, Inc., a Nevada corporation ("Texoil" or the "Company"), explores
for, develops and produces oil and natural gas. Founded in 1964, the Company
currently is focusing its operations on exploratory drilling in South Louisiana
for natural gas reserves on large prospects, typically based on interpretations
of three-dimensional ("3-D") seismic surveys. The Company's executive offices
are located at 1600 Smith Street, Suite 4000, Houston, Texas 77002, telephone
number (713) 652-5741.
The Company's strategy is to apply cost effective business measures and
newer, more efficient prospecting technologies to its exploration and production
operations. The objective of the Company's near-term strategy is maximization of
the value of its existing exploratory prospect inventory while reducing its cost
and risk exposure. To reduce costs, the Company replaced much of its internal
geological and administrative staff with outside consultants. To lower the risk
of exploration, the Company generally limits its participation in exploratory
drilling to those prospects for which geological evaluation has been obtained
through an advanced and cost-effective technology -- 3-D seismic surveys. The
Company also endeavors to spread its potential risk and expense by participating
for a lower working ("cost") interest in wells, typically one-eighth to
one-fourth, and selling additional interests on a promoted basis such that the
Company will ultimately own a 20% to 30% working interest in each prospect that
it operates. Additionally, the Company is seeking to evaluate a wider array of
exploratory prospects than it has in the past and intends to participate in the
drilling of prospects operated by others where warranted.
As an initial step in implementing its new strategy, the Company entered
into a simultaneous prospect sale and participation agreement with Texas
Meridian Resources Corporation ("Texas Meridian") in December 1992 (the
"Texoil-Texas Meridian Agreement"). Under the terms of this agreement, the
Company transferred 14 of its unleased South Louisiana exploratory prospects to
Texas Meridian for $500,000 cash, while retaining a prospect-by-prospect option
(but no obligation) to acquire from Texas Meridian on an unpromoted basis up to
a 10% working interest in wells drilled within a defined area on the Texoil
generated prospects. The arrangement also provides Texoil with the opportunity
to review the 3-D seismic survey data and other prospect information assembled
by Texas Meridian before Texoil's commitment to participate in drilling and
prior to any expenditure on Texoil's part, thus decreasing Texoil's cost and
risk exposure prior to its decision to participate. The Company also received
overriding royalties ranging from 2.0% to 3.75% in production from wells drilled
within the defined area on the prospects. Texoil chose to market these prospects
to Texas Meridian based largely upon Texas Meridian's recent industry
acknowledged expertise and success in 3-D seismic controlled exploratory
drilling. Subject to positive results from a review of the 3-D seismic data, the
Company anticipates that it will participate for a full 10% working interest in
each exploratory well which Texas Meridian may propose to drill on any prospect
areas subject to the Texoil-Texas Meridian Agreement.
Texoil will continue to be the operator for a number of its South
Louisiana exploratory prospects that it did not convey to Texas Meridian and,
generally, for any additional third-party generated prospects that it may
acquire in the future. The Company currently is seeking industry and other
partners to participate in a new Texoil-operated exploration program covering
such prospects. In that regard, the Company entered into a strategic alliance
with 3DX Technologies, Inc. ("3DX") in September 1994 for the evaluation of
South Louisiana exploration prospects using 3-D seismic technology. Texoil has
committed to the strategic alliance seven exploration prospects from its
in-house inventory. In addition, Texoil will continue committing to the alliance
all third-party generated prospects which it purchases until at least six months
after joint venture arrangements are made with other prospective partners. 3DX
will provide technical expertise to advise Texoil which of its prospects are
candidates for further definition utilizing 3-D seismic data, design the 3-D
surveys on the selected prospects, provide quality control of the data
acquisition, supervise the processing and finally interpret the data. 3DX may
purchase a 12.5% working interest in prospects selected by it for 3-D seismic
definition, with Texoil and other prospective partners owning the remaining
interests. Texoil anticipates that it will retain a 20% to 25% working interest
in any exploratory wells which are drilled.
3
RISK FACTORS
AN INVESTMENT IN THE SECURITIES OFFERED HEREBY INVOLVES A HIGH DEGREE OF RISK.
PROSPECTIVE INVESTORS SHOULD CAREFULLY CONSIDER THE FOLLOWING FACTORS BEFORE
INVESTING.
OPERATING LOSSES AND WORKING CAPITAL DEFICIT; GOING CONCERN UNCERTAINTY
Texoil has incurred losses from operations for the past six years and has
an accumulated deficit of $4,762,230 as of June 30, 1995. At the same date, it
had a working capital deficit of $1,552,935. No assurance can be made that the
Company will operate profitably in the future. The likelihood of future
profitability of the Company must be considered in light of the business and
operating risks, expenses, difficulties, and delays frequently encountered in
connection with the oil and gas exploration, development, acquisition and
production business in which the Company will be engaged. The report of the
independent accountants on the Company's financial statements included in its
Form 10-KSB for the year ended December 31, 1994 incorporated by reference
herein includes a paragraph explaining that, because the Company has suffered
recurring operating losses as well as cash flow deficits and must extend or
otherwise refinance short-term notes payable, there is substantial doubt about
the Company's ability to meet the future expenditure obligations necessary to
fully evaluate and develop its oil and gas properties and to continue as a going
concern. The financial statements incorporated by reference herein do not
include any adjustments that may result from these uncertainties.
NEED FOR ADDITIONAL CAPITAL
The oil and gas industry is capital intensive. The Company's ability to
expand its reserve base and diversify its operations is dependent upon its
ability to obtain the necessary capital. As noted above, the Company has
suffered recurring operating losses as well as cash flow deficits that raise
substantial doubt about its ability to meet the future expenditure obligations
necessary to fully develop its oil and gas properties and to continue as a going
concern. There can be no assurance as to the Company's ability to obtain the
additional capital necessary to invest in future exploration, development and
acquisition opportunities.
DEPENDENCE ON EXPLORATORY DRILLING ACTIVITIES
The success of the Company will be materially dependent upon the success
of its exploratory drilling programs, specifically its participation in the
Texoil-operated and Texas Meridian-operated prospects in South Louisiana.
Exploratory drilling involves a high degree of financial and operating risk,
including the risk that no commercially productive natural gas and oil
reservoirs will be encountered. The cost of drilling, completing and operating
both exploratory and development wells is often uncertain, and drilling
operations may be curtailed, delayed or canceled as a result of a variety of
factors, including unexpected formations and drilling conditions, pressure or
mechanical irregularities in formations, equipment failures or accidents, as
well as weather conditions, compliance with governmental requirements and
shortages or delays in the delivery of equipment. The Company will depend on the
operator of wells in which it is a non-operating participant to properly conduct
leasing, drilling and completion activities and the failure of the operator to
properly perform activities could adversely affect the Company.
CONSEQUENCES OF FUTURE NON-PAYMENT OF DRILLING COSTS
If the Company lacks and is unable to obtain cash sufficient to pay its
proportionate share of the estimated costs to drill the initial exploratory well
on a Texas Meridian-operated prospect within 30 days after Texas Meridian
recommends the drilling of the prospect, the terms of the Company's agreement
with Texas Meridian provide that the Company will lose its right to participate
in that initial well and in all wells subsequently drilled on the prospect. If,
after electing to participate in an exploratory or development well on a Texas
Meridian-operated prospect and paying the initial cost to do so, the Company
subsequently becomes unable to pay additional costs of the well, it will be
subject to contractual "non-consent" and other penalties, the operation of which
may substantially reduce or eliminate the Company's interest in wells for which
it fails to pay its full share of costs.
4
DEPENDENCE ON 3-D SEISMIC AND OTHER GEOLOGICAL AND GEOPHYSICAL DATA
The decision of the Company to participate in the drilling of exploratory
wells on the Texoil-operated and Texas-Meridian operated exploratory prospects
in South Louisiana and, ultimately, the success of the Company's participation
depends largely on the results of 3-D seismic surveys being conducted or planned
by Texoil or Texas Meridian on such prospects. The acquisition and
interpretation of 3-D and conventional seismic survey data and other geological
and geophysical data involves subjective professional judgment. Reliance on such
data and interpretations therefore poses the risk that a decision to participate
in the drilling of a well may be founded on incorrect data, erroneous
interpretations of data, or both. Although management believes that Texoil or
Texas Meridian's use of 3-D seismic surveys will increase the probability of
success of such exploratory wells and will reduce average finding costs through
the elimination of prospects that might otherwise be drilled solely on the basis
of 2-D seismic surveys and other traditional methods, there can be no assurance
as to the success of the Company's participation in the Texoil or Texas Meridian
drilling programs. Further, while 3-D seismic surveys have been credited by
various companies in the industry and in industry reports as significantly
improving success rates for exploratory and development wells once a field with
potential reserves has been identified, Texas Meridian has been utilizing the
technology for only a relatively short period of time (believed to be
approximately three years) and its only significant discoveries to date using
this technology known to Texoil have been at the Chocolate Bayou Field in
Brazoria County, Texas, in early 1993, at the Bayou Lafourche Prospect in
Lafourche Parish, Louisiana, in April 1994 and at the Lake Boeuf Prospect in
Lafourche Parish, Louisiana, in October 1994. Texoil has never before used 3-D
seismic on any of its Company-operated exploratory prospects. Therefore, there
can be no assurance that Texoil or Texas Meridian's use of the technology
actually will reduce exploration risks and finding costs in the areas of
proposed additional operations in South Louisiana.
OIL AND GAS PRICE VOLATILITY
The revenues generated by the Company are highly dependent upon the prices
of oil and gas. Market conditions make it difficult to estimate future prices of
oil and natural gas. A substantial portion of the Company's estimated future net
revenues attributable to its proved reserves as of December 31, 1994 is from oil
based on an average price of approximately $16.13 per barrel and the balance of
such revenues is natural gas based on prices of $1.67 per Mcf. In the past, the
Company's average annual sales price for oil and natural gas has been erratic,
and it is likely that oil and gas prices will continue to fluctuate in the
future. Various factors beyond the control of the Company affect prices of oil
and natural gas, including worldwide and domestic supplies of oil and natural
gas, the ability of the members of the Organization of Petroleum Exporting
Countries ("OPEC") to agree to and maintain oil price and production controls,
political instability or armed conflict in oil-producing regions, the price of
foreign imports, the level of consumer demand, the price and availability of
alternative fuels, the availability of pipeline capacity and changes in existing
federal regulation and price controls.
POSSIBLE WRITEDOWN OF OIL AND GAS PROPERTIES
At June 30, 1995, the Company's discounted future net revenues from
estimated proved oil and natural gas reserves on an after-tax basis was
approximately equal to the net capitalized cost in its full cost pool.
Accordingly, under the full-cost method of accounting for oil and gas operations
employed by the Company, so long as this situation continues, the Company may be
required to incur additional charges to operations if certain operating events
or financial conditions occur, including the following: (i) the Company is
required to write-down or write-off additional oil and gas reserves; (ii) oil
and gas prices decline; (iii) the costs of undeveloped drilling prospects are
required to be added to its full cost pool under generally accepted accounting
principles; or (iv) if the Company's related provision for federal income taxes
increases.
Worldwide prices of oil, including prices received by the Company for its
oil production, declined during 1994 and have continued to fluctuate in 1995. At
June 30, 1995, the average prices received by the Company for its oil and gas
production were $17.83 per barrel of oil and $1.98 per Mcf of gas ($16.22 on a
weighted average BOE basis), reflecting an increase of approximately $1.70 per
BOE from its December 31, 1994 average price. Should the trend of oil and gas
prices reverse and decline below the level experienced by the Company as of
December 31, 1994, the Company estimates that for each $1.00 per BOE decline in
the average price of oil and gas received by it below that level, its full cost
ceiling limitation will be reduced by approximately $320,000 (assuming all other
factors remain constant). It should be noted, however, that such ceiling
limitation is applied
5
only when the Company publicly issues its financial statements (usually
quarterly), and that, generally, the prices of oil and gas used in the
computation are those received by the Company on the last day of the month of
the period for which financial statements are issued. Based on oil and gas
prices as of March 31 and June 30, 1995, the Company determined that there was
no full cost ceiling adjustment required to be made in its financial statements
for the first two quarters of 1995. Therefore, the next ceiling test
"measurement date" is not expected to occur until the Company issues its
financial statements for the third quarter ended September 30, 1995.
LIMITATIONS ON ACCURACY OF RESERVE ESTIMATES
The reports of the Company incorporated by reference herein contain
estimates of reserves and of future net revenue which have been prepared by
independent petroleum engineers and the Company. Estimates of reserves and of
future net revenue prepared by various independent petroleum engineers may vary
substantially depending, in part, on the assumptions made and may be subject to
material adjustment, either upward or downward, in the future. This is
particularly true in the case of proved developed non-producing and proved
undeveloped reserves, which comprise approximately 46% and 0%, respectively, of
total proved reserves in the Company's independent reserve report as of December
31, 1994. The actual amounts of production, revenue, taxes, development
expenditures, operating expenses, and quantities of oil and gas reserves to be
recovered may vary substantially from the engineers' estimates. Oil and gas
reserve estimates are necessarily inexact and involve matters of subjective
engineering judgment. In addition, any estimates of future net revenue and the
present value thereof are based on period ending prices and on cost assumptions
made by the Company which only represent its best estimate. If these estimates
of quantities, prices and costs prove inaccurate, the Company is unsuccessful in
expanding its oil and gas reserves base with its capital expenditure program,
and/or declines in oil and gas prices occur, then writedowns in the capitalized
costs associated with the Company's oil and gas assets may be required.
BUSINESS RISKS
The Company must continually acquire and explore for and develop new oil
and gas reserves to replace those being depleted by production. Without
successful drilling or acquisition of reserves, Texoil's assets, properties and
revenues will decline. Oil and gas exploration and development operations are
speculative, involve a high degree of risk and are subject to all the hazards
typically associated with the search for, development of and production of oil
and gas. The cost of drilling, completing and operating wells is often
uncertain. Moreover, drilling may be curtailed, delayed or canceled as a result
of many factors, including title problems, weather conditions, shortages of or
delays in delivery of equipment, as well as the financial instability of well
operators, major working interest owners and well servicing companies. The
availability of a ready market for the Company's oil and gas depends on numerous
factors beyond its control, including the demand for and supply of oil and gas,
the proximity of the Company's natural gas reserves to pipelines, the capacity
of such pipelines, fluctuations in production and seasonal demand, the effects
of inclement weather and governmental regulation. New gas wells may be shut-in
for lack of a market until a gas pipeline or gathering system with available
capacity is extended into the area. New oil wells may have production curtailed
until production facilities and delivery arrangements are acquired or developed.
Texoil's business will always be subject to these types of risks.
OPERATING HAZARDS AND UNINSURED RISKS
The Company's operations are subject to all of the risks incident to
exploration for and production of oil and gas, including blow-outs, cratering,
pollution and fires, each of which could result in damage to or destruction of
oil and gas wells or production facilities or damage to persons and property.
The Company's insurance may not fully cover certain of these risks and the
occurrence of a significant event not fully insured against could have a
material adverse effect on the Company's financial position.
TITLE TO PROPERTIES
Until such time as an oil and gas exploration company acquires leases
covering its "prospects", its prospects are geological ideas rather than
recordable title interests in real property and are subject to prior lease in
whole or in part by others. Certain of the Texas Meridian-operated prospects and
the prospects in the Company's inventory are unleased. Until such time as all of
the lands within these prospects are leased by either the Company or Texas
Meridian as the case may be, it is possible that all or a portion of such
prospects could be leased by others.
6
GOVERNMENTAL REGULATION AND ENVIRONMENTAL RISKS
The production and sale of oil and gas are subject to a variety of
federal, state and local government regulations, including regulations
concerning the prevention of waste, the discharge of materials into the
environment, the conservation of natural gas and oil, pollution, permits for
drilling operations, drilling bonds, reports concerning operations, the spacing
of wells, the unitization and pooling of properties, the clean-up of well sites,
and various other matters, including taxes. Laws and regulations protecting the
environment have generally become more stringent in recent years, and may in
certain circumstances impose "strict liability," rendering a person liable for
environmental damage without regard to negligence or fault on the part of such
person. Such laws and regulations may expose the Company to liability for the
conduct of operations or conditions caused by others, or for acts of the Company
which were in compliance with all applicable laws at the time such acts were
performed. An increase in federal, state or local production or property taxes,
the modification of existing laws or regulations or the adoption of new laws or
regulations relating to environmental matters could have a material adverse
effect on the Company's operations.
Federal and state laws and regulations presently prohibit discharge of
produced water into coastal waters at many locations and, within three years,
are generally expected to prohibit all such discharge. The Company presently
discharges produced water from wells at three of its properties. When the
prohibition becomes effective, the Company will be required to install
underground disposal facilities for the affected properties or abandon the
remaining portion of reserves in those properties. Management expects, however,
that compliance with these regulations will not have a material impact on the
Company's financial position.
DEPENDENCE ON KEY PERSONNEL
The loss of the services of any of the Company's officers may adversely
affect the Company's business. The success of the Company will particularly be
dependent upon the efforts and active participation of Walter L. Williams, the
Chairman and Chief Executive Officer of the Company. The Company presently
maintains no key person life insurance on the life of Mr. Williams.
COMPETITION
The oil and gas industry is highly competitive in many respects, including
identification of attractive oil and gas properties for acquisition, drilling
and development, securing financing for such activities and obtaining the
necessary equipment and personnel to conduct such operations and activities. In
seeking suitable opportunities, the Company competes with a number of other
companies, including large oil and gas companies and other independent operators
with greater financial resources and, in some cases, with more experience. Many
other oil and gas companies in the industry have financial resources, personnel
and facilities substantially greater than those of the Company and there can be
no assurance that the Company will continue to be able to compete effectively
with these larger entities.
DIVIDENDS
Under the General Corporation Law of Nevada, a corporation's board of
directors may declare and pay dividends only to the extent that after giving
effect thereto, the corporation can pay its debts as they become due in the
ordinary course, and its total assets exceed its liabilities plus amounts
payable upon dissolution to stockholders with preferential rights. There can be
no assurance that at any given time, the Company will be permitted under such
provisions of Nevada law to pay dividends on the Common Stock.
The Company does not currently pay cash dividends on its Common Stock and
does not anticipate paying such dividends in the foreseeable future. The
Company's loan agreement with First Interstate Bank of Texas, N.A. and the terms
of its Series A Preferred Stock restrict the payment of dividends on the Common
Stock.
The Company has issued 23,000 shares of its Series A Preferred Stock which
bears annual, cumulative dividends of $12 per share (a total annual dividend of
$276,000), payable quarterly. The Company has from time to time, and may in the
future, experience cash flow shortages. Payment of cash dividends on the
Series A
7
Preferred Stock outstanding will reduce the Company's cash which would otherwise
be available for other corporate purposes.
LISTING AND MAINTENANCE CRITERIA FOR NASDAQ SECURITIES; PENNY STOCK RULES
The Company's Common Stock and Class A Warrants and Class B Warrants have
been listed on the NASDAQ Small-Cap Market since May 27, 1994. For continued
inclusion of those securities on the NASDAQ Small-Cap Market, the Company must
meet several maintenance requirements including total assets of at least
$2,000,000, capital and surplus of at least $1,000,000, a public float of at
least 100,000 shares of Common Stock with a market value of at least $200,000,
and if market value of public float is less than $1,000,000 and capital and
surplus are less than $2,000,000, a minimum bid price per share of Common Stock
of $1.00. There is no assurance that the Company will be able to meet these
maintenance requirements. If the Company's securities fail to maintain NASDAQ
Small-Cap Market listing, the market value of the securities likely would
decline and purchasers in this offering likely would find it more difficult to
dispose of, or to obtain accurate quotations as to the market value of the
Common Stock.
In addition, if the Company fails to maintain NASDAQ Small-Cap Market
listing for its securities, and no other exclusion from the definition of a
"penny stock" under the Securities Exchange Act of 1934, as amended, is
available, then transactions in the Company's securities would become subject to
a Securities and Exchange Commission rule pertaining to trading of penny stocks.
This rule imposes additional sales practice requirements on broker-dealers who
sell such securities to persons other than established customers and accredited
investors (generally institutions with assets in excess of $5,000,000, or
individuals with net worth in excess of $1,000,000 or annual income exceeding
$200,000 or $300,000 jointly with their spouse). For transactions covered by the
rule, the broker-dealer must make a special suitability determination for the
purchaser and receive the purchaser's written agreement to the transaction prior
to the sale. Consequently, the rule may affect the ability of broker-dealers to
sell the Company's securities and also may affect the ability of purchasers in
this Offering to sell their shares in the secondary market.
CONCENTRATION OF OWNERSHIP
The Company's officers and directors and their respective family members
own, and after giving effect to this offering will continue to own, beneficially
approximately 61% of all classes of the Company's outstanding voting capital
stock. Accordingly, these stockholders, if they voted together, will continue to
have the ability to control or significantly influence the election of the
Company's directors and other matters requiring action by its stockholders.
PREFERRED STOCK; NEVADA TAKEOVER STATUTE
The 23,000 shares of the Company's outstanding Series A Preferred Stock
are held by T. W. Hoehn, Jr. who is a director of the Company, a charitable
trust established by him, and by his son. The Company has available for issuance
9,977,000 shares of preferred stock, par value $.01 per share. The Company's
Articles of Incorporation empower the Board of Directors to authorize the
issuance of preferred stock in series and to fix the rights, powers, preferences
and limitations of each series. As a result, the Board of Directors has the
power to afford the holders of any series of preferred stock preferences, powers
and rights, voting or otherwise, senior to, or greater than the rights of
holders of Common Stock. The Company therefore may issue a series of preferred
stock in the future with greater voting rights than the Common Stock, and
preference over the Common Stock with respect to the payment of dividends and
upon liquidation, dissolution or winding up. Issuance of shares of such
preferred stock or issuance of rights to acquire such shares could have the
effect of delaying, deferring, or preventing a change in control of the Company,
and could make more difficult a merger, tender offer or proxy contest involving
the Company, even if such events would be beneficial to the interests of its
stockholders.
Provisions of Nevada law requiring disinterested director or stockholder
approval of certain business combinations between the Company and holders of 10%
or more of its voting securities also could have the effect of delaying,
deferring, or preventing a change in control of the Company, and make more
difficult a merger, tender offer or proxy contest involving the Company.
Although in August 1994 the Company's stockholders approved an
8
<PAGE>
amendment to the Company's Articles of Incorporation pursuant to which the
Company has elected not to be governed by such provisions of Nevada law, the
amendment will not become effective until February 29, 1996.
LIMITATION OF MANAGEMENT LIABILITY
As permitted by Nevada law, the Company's Articles of Incorporation allow
the Company and its stockholders only equitable remedies for most breaches of
fiduciary duty by its directors and officers. Elimination of monetary damages as
a remedy may discourage litigation against the Company's directors and officers
for such breaches. In addition, equitable remedies may be ineffective in
situations where the only remedy is to enjoin an act or omission which already
has occurred, possibly leaving the Company and its stockholders with no
effective remedy against the subject directors or officers. See
"Indemnification."
SELLING STOCKHOLDERS
The following table sets forth certain information concerning the Selling
Stockholders:
<TABLE>
<CAPTION>
SHARES SHARES TO SHARES TO PERCENT
NAME AND ADDRESS OWNED BE SOLD(1) BE OWNED OF CLASS
-------------------------------------------- --------------------- -------------- ------------- -----------
<S> <C> <C> <C> <C>
Walter L. Williams(2)....................... 427,977(3) 7,103 420,874(3) 10.2%
1600 Smith Street, Suite 4000
Houston, Texas 77002
John L. Graves(4)........................... 383,951(5) 5,329 376,775(6) 8.7%
Lynn W. Graves(4)........................... (5) 1,847 (6)
1600 Smith Street, Suite 4000
Houston, Texas 77002
Ruben Medrano(7)............................ 25,683(8) 5,683 20,000(8) Less than 1%
1600 Smith Street, Suite 4000
Houston, Texas 77002
D. Hughes Watler, Jr(9)..................... 45,329(10) 5,329 40,000(10) Less than 1%
23 Woodsborough Circle
Houston, Texas 77055
Dennis Drake(11)............................ 5,329 5,329 0 Less than 1%
1819 Hamlin Valley
Houston, Texas 77090
</TABLE>
------------
(1) All shares to be sold were acquired pursuant to the Company's 1995
Stock Compensation Plan. Effective April 1, 1995, the Company's Board
of Directors reduced the base compensation of certain of the Company's
employees and consultants by 30% to conserve the Company's financial
resources. In order to provide such employees and consultants the
opportunity to be paid the amount by which their compensation has been
so reduced in shares of Common Stock, the Board adopted the 1995 Stock
Compensation Plan effective April 1, 1995.
(2) Mr. Williams has been a director of the Company since he co-founded it
in 1964, has been Chairman and Chief Executive Officer of the Company
since July 1995, and served as its President from 1971 to July 1995.
Betty B. Williams, wife of Mr. Williams, loaned $50,000 to the Company
that is due November 1, 1995, and in connection therewith, was issued a
warrant exercisable for 5,000 shares of Common Stock at any time before
May 27, 1996 at a per share price of $3.00. The loan is evidenced by a
promissory note bearing interest at an annual rate of 2% over the prime
rate charged by the Company's bank lender, First Interstate Bank of
Texas, N.A., which was 9% at June 30, 1995.
9
(3) Includes 50,000 shares issuable pursuant to a presently exercisable
option. Includes 35,268 shares owned by Mrs. Williams, and 5,000 shares
issuable to her pursuant to a presently exercisable warrant.
Mr. Williams disclaims beneficial ownership of such shares.
(4) Mr. Graves and Ms. Graves are husband and wife, and the son-in-law and
daughter, respectively, of Mr. Williams. Mr. Graves has been a director
of the Company since 1990, has been President and Chief Operating
Officer of the Company since July 1995, and was its Executive Vice
President from December 1992 to July 1995. He has been employed by the
Company since joining it as a field landman in 1981, becoming Vice
President-Land in 1987. Mrs. Graves has been Secretary of the Company
since October 1992.
(5) Includes 281,384 shares issuable to Mr. Graves pursuant to a presently
exercisable option and 94,140 shares owned by Mrs. Graves. Mr. Graves
disclaims beneficial ownership of such shares.
(6) Includes 281,384 shares issuable to Mr. Graves pursuant to a presently
exercisable option and 92,293 shares owned by Mrs. Graves. Mr. Graves
disclaims beneficial ownership of such shares.
(7) Mr. Medrano has been Vice President--Operations of the Company since
July 1994 and was a consultant to the Company from November 1992 until
July 1994.
(8) Includes 20,000 shares issuable pursuant to a presently exercisable
option.
(9) Mr. Watler has been the Company's Chief Financial Officer since
November 1992 and is resigning from such position effective August 31,
1995.
(10) Includes 40,000 shares issuable pursuant to a presently exercisable
option.
(11) Mr. Drake has been a consultant to the Company since August 1994.
PLAN OF DISTRIBUTION
All or part of the Common Stock offered hereby may be sold by the
Selling Stockholders from time to time on the NASDAQ SmallCap Market or the
Boston Stock Exchange or otherwise at prices current at the time of sale or at
prices related to such market prices, either directly or through brokers or to
dealers, to the extent that such prices are obtainable and satisfactory to the
Selling Stockholders. It is anticipated that any commissions with respect to
such sales will not exceed regular brokerage commissions. The Selling
Stockholders, and brokers executing selling orders on behalf of the Selling
Stockholders and dealers to whom the Selling Stockholders may sell, may be
deemed "underwriters" within the meaning of the Securities Act. Any profit
represented by the excess of the selling price over the cost of the shares sold
in the case of dealers, or any commission received in the case of brokers, may
be deemed to be underwriting discounts or commissions under the Securities Act.
The Selling Stockholders may sell all or part of the Common Stock
offered hereby pursuant to Rule 144 under the Securities Act.
INDEMNIFICATION
LIABILITY LIMITATION. As permitted by Section 78.037 of the General
Corporation Law of Nevada (the "NGCL"), the Company's Articles of Incorporation
eliminate the liability of its directors and officers to the Company and its
stockholders for damages for breach of fiduciary duty, except for acts or
omissions which involve intentional misconduct, fraud or a knowing violation of
law, or for the payment of distributions in violation of the NGCL. To the extent
that this provision limits the remedies of the Company and its stockholders to
equitable remedies, it might reduce the likelihood of derivative litigation and
discourage the Company's management or stockholders from initiating litigation
against its directors or officers for breach of their fiduciary duties.
Additionally, equitable remedies may not be effective in many situations. If a
stockholder's only remedy is to enjoin the completion of an act, such remedy
would be ineffective if the stockholder does not become aware of a transaction
or event until after it has been completed. In such a situation, it is possible
that the Company and its stockholders would have no effective remedy against
directors or officers.
10
INDEMNIFICATION. The Company's Amended and Restated Bylaws contain
indemnification provisions which are consistent with those contained in the
NGCL. Accordingly, the Company generally may indemnify its directors and
officers against liabilities and expenses to which they may become subject or
which they may incur as a result of being or having been a director, officer,
employee or agent of the Company. Pursuant to an Agreement and Plan of Merger,
dated as of November 4, 1992, as amended (the "Agreement"), by and between the
Company, Comet Acquisition Subsidiary, Inc. and Texoil Company, the Company must
indemnify Texoil Company (which, as a result of consummation of the transactions
contemplated by the Agreement, now is a wholly-owned subsidiary of the Company)
and its directors, officers and shareholders (many of whom, as a result of
consummation of the transactions contemplated by the Agreement, now are
directors, officers and shareholders of the Company), from liabilities relating
to the Company's breach of its representations, warranties and covenants,
including, without limitation, liabilities under the Securities Act. Insofar as
indemnification for liabilities arising under the Securities Act may be
permitted to directors, officers and controlling persons of the Company pursuant
to the foregoing provisions, or otherwise, the Company has been advised that in
the opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Securities Act and is, therefore,
unenforceable.
COUNSEL
The validity of the Common Stock offered hereby has been passed upon
for the Company by Porter & Hedges, L.L.P., Houston, Texas.
11
<PAGE>
No person is authorized to give any information or to make any representation
not contained in this Prospectus; any information or representation not
contained herein must not be relied upon as having been authorized by the
Company. This Prospectus does not constitute an offer of any securities other
than those to which it relates or an offer to any person in any state where such
offer would be unlawful. Neither the delivery of this Prospectus nor any sale
hereunder shall under any circumstances create any implication that there has
been no change in the affairs of the Company since the date hereof.
TABLE OF CONTENTS
PAGE
Available Information ................................................... 2
Incorporation of Certain Documents by Reference ......................... 2
The Company ............................................................. 3
Risk Ractors ............................................................ 4
Selling Stockholders .................................................... 9
Plan of Distribution .................................................... 10
Indemnification ......................................................... 10
Counsel ................................................................. 11
------------
30,620 SHARES
TEXOIL, INC.
COMMON STOCK
-------------------
P R O S P E C T U S
-------------------
AUGUST 28, 1995
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The contents of the following documents filed by Texoil, Inc., a Nevada
corporation (the "Company" or "Registrant"), with the Securities and Exchange
Commission ("Commission") are incorporated into this registration statement
("Registration Statement") by reference: (i) the Company's annual report on Form
10-KSB for the fiscal year ended December 31, 1994, (ii) the Company's quarterly
report on Form 10-QSB for the fiscal quarter ended March 31, 1995, (iii) the
Company's quarterly report on Form 10-QSB for the fiscal quarter ended June 30,
1995, (iv) the Company's current report on Form 8-K dated July 10, 1995, and (v)
the description of the Company's common stock, par value $.01 per share, set
forth under the caption "Description of Registrant's Securities to be
Registered" in the Company's registration statement on Form 8-A, dated February
12, 1994, Commission File No. 1-12834, and any amendment or report filed for the
purpose of updating such description.
All documents filed by the Company with the Commission pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), subsequent to the filing date of this Registration
Statement and prior to the filing of a post-effective amendment to this
Registration Statement which indicates that all securities offered have been
sold or which deregisters all securities then remaining unsold shall be deemed
to be incorporated by reference in this Registration Statement and to be a part
hereof from the date of filing such documents. The Company will provide without
charge to each participant in each of the Company's 1994 Stock Option Plan and
1995 Stock Compensation Plan, upon written or oral request of such person, a
copy (without exhibits, unless such exhibits are specifically incorporated by
reference) of any or all of the documents incorporated by reference pursuant to
this Item 3.
ITEM 4. DESCRIPTION OF SECURITIES
Not Applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
Not Applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Article VII of Registrant's Amended and Restated Bylaws contains
indemnification provisions which are consistent with those contained in Section
78.751 of the General Corporation Law of Nevada ("NGCL"). Accordingly,
Registrant generally may indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative, by
reason of the fact that he is or was a director, officer, employee or agent of
Registrant or is or was serving at the request of Registrant as a director,
officer, employee or agent of another corporation, partnership, joint venture,
trust or other enterprise, against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably incurred
by him in connection with such action, suit or proceeding. However, with respect
to an action or suit brought to obtain a judgment in Registrant's favor, whether
by Registrant itself or derivatively by a stockholder, (i) such indemnification
is limited to expenses, including amounts paid in settlement and attorneys' fees
actually and reasonably incurred by him in connection with the defense or
settlement of the action or suit, and (ii) indemnification may not be made for
any claim, issue or matter as to which such a person has been adjudged by a
court of competent jurisdiction, after exhaustion of all appeals therefrom, to
be liable to Registrant or for amounts paid in settlement to Registrant, unless
and only to the extent that the court in which the action or suit was brought or
other court of competent jurisdiction determines upon application that in view
of all the circumstances of the case, the person is fairly and reasonably
entitled to indemnity for such expenses as the court deems proper.
II-1
In all cases, the person seeking indemnification must have acted in
good faith and in a manner he reasonably believed to be in, or not opposed to,
Registrant's best interests. In the case of criminal actions or proceedings, the
person must also have had no reasonable cause to believe his conduct was
unlawful. The determination as to whether a person seeking indemnification has
met the required standard of conduct must be made by Registrant's stockholders,
by a majority vote of a quorum of its disinterested directors, or by independent
legal counsel in a written opinion if such a quorum does not exist or if the
disinterested directors so direct.
To the extent that a director, officer, employee or agent of Registrant
has been successful on the merits or otherwise in defending any action, suit or
proceeding for which indemnification is permissible under the NGCL, or in
defending any claim, issue or matter therein, Registrant must, under both the
NGCL and its Bylaws, indemnify him against expenses, including attorneys' fees,
actually and reasonably incurred by him in connection with the defense. As
permitted by the NGCL, Registrant's Articles of Incorporation and Bylaws require
it to advance expenses which its officers and directors incur in defending any
civil or criminal action, suit or proceeding upon receipt of an undertaking by
him or on his behalf to repay such amounts if it is ultimately determined by a
court of competent jurisdiction that he is not entitled to be indemnified by
Registrant.
The NGCL and Registrant's Bylaws provide that the indemnification and
advancement of expenses authorized therein are not exclusive. Accordingly,
Registrant could provide for other indemnification of its directors and officers
acting in either or both of their official capacities or other capacities while
holding office. However, excepting advancement of expenses and court-ordered
indemnification explicitly provided for by the NGCL, the NGCL and Registrant's
Bylaws prohibit Registrant from indemnifying any director or officer if a final
adjudication establishes that his acts or omissions involved intentional
misconduct, fraud or a knowing violation of the law and was material to the
cause of action.
Consistent with Section 78.752 of the NGCL, Registrant's Bylaws empower
it to procure and maintain insurance or make other financial arrangements on
behalf of any person who is or was a director, officer, employee or agent of
Registrant, or at Registrant's request, of another entity, against any liability
asserted against him and liability and expenses incurred by him in such
capacity, or arising out of his status as such, regardless of whether Registrant
could indemnify him against such liability and expenses. However, financial
arrangements other than insurance cannot provide protection for a person
adjudged by a court of competent jurisdiction, after exhaustion of all appeals
therefrom, to be liable for intentional misconduct, fraud or a knowing violation
of law, except with respect to the advancement of expenses and court-ordered
indemnification. The Company maintains insurance covering its directors and
officers for liabilities which they may incur in their capacities as such.
As permitted by Section 78.037 of the NGCL, Registrant's Articles of
Incorporation eliminate the liability of its directors and officers to
Registrant and its stockholders for damages for breach of fiduciary duty, except
for acts or omissions which involve intentional misconduct, fraud or a knowing
violation of law, or for the payment of distributions in violation of Section
78.300 of the NGCL. To the extent that this provision limits the remedies of
Registrant and its stockholders to equitable remedies, it might reduce the
likelihood of derivative litigation and discourage Registrant's management or
stockholders from initiating litigation against its directors or officers for
breach of their fiduciary duties. Additionally, equitable remedies may not be
effective in many situations. If a stockholder's only remedy is to enjoin the
completion of an action, such remedy would be ineffective if the stockholder
does not become aware of a transaction or event until after it has been
completed. In such a situation, it is possible that Registrant and its
stockholders would have no effective remedy against directors or officers.
The above discussion of the NGCL and Registrant's Articles of
Incorporation and Bylaws is not intended to be exhaustive and is qualified in
its entirety by such Articles, Bylaws and statute.
Pursuant to that certain Agreement and Plan of Merger, dated as of
November 4, 1992, as amended (the "Agreement"), by and between Registrant, Comet
Acquisition Subsidiary, Inc. and Texoil Company, Registrant must indemnify and
hold harmless Texoil Company (which, as a result of consummation of the
transactions contemplated by the Agreement, now is a wholly-owned subsidiary of
Registrant) and each director, officer and shareholder thereof (many of whom, as
a result of consummation of the transactions contemplated by the
II-2
Agreement, now are directors, officers and shareholders of Registrant), from and
against any and all losses, claims, damages, expenses or liabilities
(collectively, "Claims"), joint or several, to which they or any of them may
become subject under the Securities Act of 1933, as amended, or any other
statute or at common law or otherwise, and generally must reimburse Texoil
Company and each such director, officer or shareholder for any legal or other
expenses reasonably incurred by them or any of them in connection with
investigating or defending any actions whether or not resulting in any
liability, insofar as such Claims result from a breach or alleged breach of the
representations, warranties or covenants contained in the Agreement, or arise
out of or are based upon any untrue statement or alleged untrue statement of a
material fact contained in the Agreement, or arise out or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, but
only insofar as the untrue statement or omission or alleged untrue statement or
omission was made with respect to the description of Registrant.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Of the 350,000 shares of Common Stock covered by this registration
statement, 30,620 shares were issued as restricted securities (within the
meaning of Rule 144(a)(3) under the Securities Act of 1933, as amended
("Securities Act")) in reliance upon the exemption from registration provided by
Section 4(2) of the Securities Act. The 30,620 shares were issued under the
Company's 1995 Stock Compensation Plan ("1995 Plan") to a total of six persons
without any general solicitation or advertising. Of these six persons, five are
employees of the Company and one is a consultant to the Company. Each of the
five employees is an officer of the Company, and two of such employees also are
directors of the Company. At the time of issuance, each of these persons had a
preexisting personal or business relationship with the Company or its officers
of such nature or duration as to enable him or her to be aware of the character,
business acumen and general business and financial circumstances of the Company
or such officers. The terms of the 1995 Plan and related participation
agreements provide that (i) participants who acquire unregistered shares
thereunder acquire them subject to transfer restrictions imposed by applicable
securities laws and for their own account for investment purposes and not with a
view to distribution, and (ii) certificates evidencing such shares will bear a
conspicuous restrictive legend as to their unregistered status and limitations
on their transferability under applicable securities laws. Each outstanding
certificate evidencing such shares bears such a legend.
ITEM 8. EXHIBITS
The following is a list of all exhibits filed as part of this
Registration Statement.
Exhibit
No. Description
------- -----------
5 Opinion of Porter & Hedges, L.L.P. with respect to legality of
securities.
23-A Consent of Porter & Hedges, L.L.P. (included in Exhibit 5).
23-B Consent of Price Waterhouse LLP.
24 Powers of Attorney (included on signature page).
ITEM 9. UNDERTAKINGS
(a) 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 to:
(i) Include any prospectus required by section 10(a)(3) of the
Securities Act of 1933, as amended (the "Securities Act");
II-3
<PAGE>
(ii) 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, and notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in
the aggregate, the changes in the volume and price represent no more
than a 20% change in the maximum aggregate offering price set forth in
the "Calculation of Registration Fee" table in the effective
registration statement; and
(iii) 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 (a)(1)(i) and (a)(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 the registrant pursuant to
Section 13 or Section 15(d) of the Exchange Act that are incorporated by
reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act, 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.
(b) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities 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 Securities Act and will be governed by the final
adjudication of such issue.
II-4
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Walter L. Williams or John L. Graves, and
each of them, either of whom may act without joinder of the other, his true and
lawful attorneys-in-fact and agents, with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign any or all 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 such
attorneys-in-fact and agents, and each of them, full power and authority to do
and perform each and every act and thing requisite and necessary to be done in
and about the premises, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, and each of them, or the substitute or substitutes
of either of them, may lawfully do or cause to be done by virtue hereof.
SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Houston, State of Texas, on August 25, 1995.
TEXOIL, INC.
By: /s/ WALTER L. WILLIAMS
Walter L. Williams,
Chairman and Chief Executive Officer
Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed by the following persons in the indicated capacities
and on the 25th day of August 1995.
SIGNATURE TITLE
/s/ WALTER L. WILLIAMS Director, and
Walter L. Williams Chairman and Chief Executive Officer
/s/ JOHN L. GRAVES Director, and
John L. Graves President and Chief Operating Officer
/s/ D. HUGHES WATLER, JR. Chief Financial Officer
D. Hughes Watler, Jr. (principal financial and
accounting officer)
/s/ T. W. HOEHN, JR. Director
T. W. Hoehn, Jr.
II-5
/s/ JOE C. RICHARDSON, JR. Director
Joe C. Richardson, Jr.
/s/ WILLIAM F. SEAGLE Director
William F. Seagle
/s/ T. W. HOEHN, III Director
T. W. Hoehn, III
II-6
INDEX TO EXHIBITS
Exhibit
No.
-------
*5 Opinion of Porter & Hedges, L.L.P. with respect to legality of
securities.
*23-A Consent of Porter & Hedges, L.L.P. (included in Exhibit 5).
*23-B Consent of Price Waterhouse LLP.
*24 Powers of Attorney (included on signature page).
------------
* Filed herewith
<PAGE>
EXHIBIT 5
PORTER & HEDGES, L.L.P.
ATTORNEYS AT LAW
700 LOUISIANA, 35th FLOOR
HOUSTON, TEXAS 77002-2764 MAILING ADDRESS:
P.O. BOX 4744
HOUSTON, TX 77210-4744
August 28, 1995
Texoil, Inc.
1600 Smith Street, Suite 4000
Houston, Texas 77002
Re: TEXOIL, INC. REGISTRATION STATEMENT ON FORM S-8
1994 STOCK OPTION PLAN
1995 STOCK COMPENSATION PLAN
Gentlemen:
We have acted as counsel to Texoil, Inc., a Nevada corporation
("Company"), in connection with the preparation for filing with the Securities
and Exchange Commission of a Registration Statement on Form S-8 ("Registration
Statement") under the Securities Act of 1933, as amended. The Registration
Statement relates to an aggregate of 350,000 shares ("Shares") of the Company's
common stock, par value $.01 per share ("Common Stock"), of which 250,000 are
issuable under the Company's 1994 Stock Option Plan ("1994 Plan"), 69,380 are
issuable under the Company's 1995 Stock Compensation Plan (the "1995 Plan"), and
30,620 have been issued under the 1995 Plan. The 1994 Plan and 1995 Plan are
referred to collectively as the "Plans."
We have examined each of the Plans and such corporate records,
documents, instruments and certificates of the Company, and have reviewed such
questions of law as we have deemed necessary, relevant or appropriate to enable
us to render the opinion expressed herein. In such examination, we have assumed
without independent investigation the authenticity of all documents submitted to
us as originals, the genuineness of all signatures, the legal capacity of all
natural persons, and the conformity of any documents submitted to us as copies
to their respective originals. As to certain questions of fact material to this
opinion, we have relied without independent investigation upon statements or
certificates of public officials and officers of the Company.
Based upon such examination and review, we are of the opinion that the
Shares have been duly and validly authorized and are, or upon issuance and
delivery as contemplated by the Plans will be, validly issued, fully paid and
nonassessable outstanding shares of Common Stock.
We hereby consent to the reference to our firm under the caption
"Counsel" in the prospectus included in the Registration Statement and to the
filing of this opinion as an exhibit to the Registration Statement.
Very truly yours,
/s/ Porter & Hedges, L.L.P.
PORTER & HEDGES, L.L.P.
<PAGE>
EXHIBIT 23-B
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this
Registration Statement on Form S-8 of our report dated March 20, 1995, which
appears on page F-2 of the 1994 Annual Report of Texoil, Inc. on Form 10-KSB.
/s/ Price Waterhouse LLP
Price Waterhouse LLP
Houston, Texas
August 28, 1995
