As filed with the Securities and Exchange Commission on November 4, 1996
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. AMENDED AND RESTATED 1996 STOCK COMPENSATION PLAN
(Full Title of the Plan)
Name, Address and Telephone Copy of communications to:
Number of Agent for Service:
NICK D. NICHOLAS
RUBEN MEDRANO 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 200,000 $1.50 $300,000 $104
=======================================================================================================================
</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 October 31, 1996, $1.50 per share.
<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, 1995, (ii) the Company's quarterly
report on Form 10-QSB for the fiscal quarter ended March 31, 1996, (iii) the
Company's quarterly report on Form 10-QSB for the fiscal quarter ended June 30,
1996, (iv) the Company's current report on Form 8-K dated February 5, 1996, (v)
the Company's current report on Form 8-K dated April 17, 1996, (vi) the
Company's current report on Form 8-K dated September 6, 1996, and (vii) 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 the Company's Amended and Restated 1996 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.
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.
<PAGE>
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 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.
2
<PAGE>
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not Applicable.
ITEM 8. EXHIBITS
The following is a list of all exhibits filed as part of this
Registration Statement.
Exhibit
No. Description
- ------- -----------
4.1 Texoil, Inc. Amended and Restated 1996 Stock Compensation Plan
(filed herewith).
5 Opinion of Porter & Hedges, L.L.P. with respect to legality of
securities (filed herewith).
23.1 Consent of Porter & Hedges, L.L.P. (included in Exhibit 5).
23.2 Consent of BDO Seidman, LLP (filed herewith).
23.3 Consent of Price Waterhouse LLP (filed herewith)
24 Powers of Attorney (included on signature page).
3
<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) Reflect in the prospectus any facts or events which,
individually or together, represent a fundamental change in the
information in the registration statement; and
(iii) Include any additional or changed material
information on the plan of distribution;
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 under the
Exchange Act.
(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) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to section 13(a) or section 15(d) of the
Exchange Act that is incorporated by reference in the registration statement
shall be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
(c) 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.
4
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints T. W. Hoehn, Jr. or Ruben Medrano, 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 the date indicated
beneath the undersigned's signature.
TEXOIL, INC.
By: /s/ RUBEN MEDRANO
Ruben Medrano,
President and Chief Executive Officer
Date Signed: OCTOBER 23, 1996
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 date indicated.
SIGNATURE TITLE
/s/ T. W. HOEHN, III Director, and
T. W. Hoehn, III Chairman of the Board
Date Signed: OCTOBER 28, 1996
/s/ RUBEN MEDRANO Director, and
Ruben Medrano President and Chief Executive
Date Signed: OCTOBER 23, 1996 Officer
5
<PAGE>
SIGNATURE TITLE
/s/ GARY J. MILAVEC Director, and Treasurer
Gary J. Milavec (principal financial and accounting
Date Signed: OCTOBER 28, 1996 officer)
/s/ T. W. HOEHN, JR. Director
T. W. Hoehn, Jr.
Date Signed: OCTOBER 28, 1996
/s/ JOE C. RICHARDSON, JR. Director
Joe C. Richardson, Jr.
Date Signed: OCTOBER 29, 1996
/s/ WILLIAM F. SEAGLE Director
William F. Seagle
Date Signed: OCTOBER 29, 1996
/s/ WALTER L. WILLIAMS
Walter L. Williams
Date Signed: OCTOBER 25, 1996 Director
6
<PAGE>
INDEX TO EXHIBITS
Exhibit
No. Description
- ------- -----------
4.1 Texoil, Inc. Amended and Restated 1996 Stock Compensation Plan
(filed herewith).
5 Opinion of Porter & Hedges, L.L.P. with respect to legality of
securities (filed herewith).
23.1 Consent of Porter & Hedges, L.L.P. (included in Exhibit 5).
23.2 Consent of BDO Seidman, LLP (filed herewith).
23.3 Consent of Price Waterhouse LLP (filed herewith)
24 Powers of Attorney (included on signature page).
EXHIBIT 4.1
TEXOIL, INC.
AMENDED AND RESTATED
1996 STOCK COMPENSATION PLAN
1. PURPOSE OF THE PLAN
Effective April 1, 1995, the Board of Directors of Texoil, Inc., a
Nevada corporation (the "COMPANY"), reduced the base salary or compensation of
certain of the Company's employees and consultants by 30% (the "SALARY
REDUCTION") to conserve the Company's financial resources. The Company adopted
the 1995 Stock Compensation Plan to provide the Company's employees and
consultants the opportunity to be paid the amount by which their compensation
has been so reduced in shares of the Company's common stock, par value $.01 per
share ("COMMON STOCK"). The 1995 Stock Compensation Plan expired March 31, 1996
with an insufficient number of shares of Common Stock reserved for issuance
thereunder remaining to cover issuances which otherwise would have been made in
respect of March 1996.
By consent dated June 10, 1996, the Company's Board of Directors adopted
the 1996 Stock Compensation Plan to provide the Company's employees and
consultants the opportunity to continue to be paid the amount of their Salary
Reduction in shares of Common Stock. The 1996 Stock Compensation Plan required
shareholder approval thereof before shares could be issued thereunder.
Shareholder approval was a requirement of Rule 16b-3 promulgated under Section
16 of the Securities Exchange Act of 1934, as amended (the "1934 ACT"). After
the Board's adoption of the 1996 Stock Compensation Plan, Rule 16b-3 was amended
and shareholder approval no longer is mandatory thereunder. Since the 1996 Stock
Compensation Plan has not been implemented and no Common Stock issued
thereunder, the Company's Board of Directors desires to amend and restate the
1996 Stock Compensation Plan to make it more consistent with amended Rule 16b-3.
Accordingly, this Amended and Restated 1996 Stock Compensation Plan (the "PLAN")
supersedes the 1996 Stock Compensation Plan in its entirety.
2. ADMINISTRATION
The Plan shall be administered by the Company's Board of Directors (the
"BOARD"), or the Compensation Committee of the Board or such other committee as
the Board shall appoint from time to time to administer the Plan (the
"COMMITTEE"). The Committee shall consist of two or more persons each of whom
shall be a "Non-Employee Director" within the meaning of Rule 16b-3 under the
1934 Act.
The Board or Committee shall have full authority to administer the Plan,
including authority to interpret and construe any provision of the Plan or any
Participation Agreement (defined below) entered into pursuant hereto, and to
adopt such rules and regulations for administering the Plan as it may deem
necessary. Decisions of the Board or Committee shall be final and binding on all
parties.
No member of the Board or Committee shall be liable for any action,
omission, or determination relating to the Plan, and the Company shall indemnify
and hold harmless each member of the Board and Committee and each other director
or employee of the Company to whom any duty or power relating to the
administration or interpretation of the Plan has been delegated from and against
any cost or expense (including attorneys' fees) or liability (including any sum
paid in settlement of a claim with the approval of the Board or Committee)
arising out of any action, omission or determination relating to the Plan,
unless, in either case, such action, omission or determination was taken or made
by such member, director or employee in bad faith and without reasonable belief
that it was in the best interests of the Company.
-1-
<PAGE>
3. STOCK RESERVED FOR THE PLAN
The shares subject to the Plan shall consist of 200,000 authorized but
unissued shares of Common Stock or previously issued shares reacquired and held
by the Company, and such number of shares shall be and hereby is reserved for
issuance pursuant to the Plan. Any of such shares which may remain unissued upon
the Plan's termination shall cease to be reserved for purposes of the Plan. If
and whenever the Company shall effect a subdivision or consolidation of shares
of Common Stock or the payment of a stock dividend on Common Stock without
receipt of consideration by the Company, the number of shares of Common Stock
subject to the Plan shall be proportionately increased or reduced, respectively.
4. PLAN PARTICIPATION
Any employee or consultant of the Company whose compensation has been
reduced by the Board to conserve the Company's financial resources is eligible
to participate in the Plan. Each such employee and consultant may participate in
the Plan for so long as he or she is employed or engaged by the Company and the
Plan is in effect. Such election to participate must be made by entering into an
agreement with the Company to be bound by the Plan's terms and conditions, and
containing such other provisions as the Board or Committee deems necessary or
appropriate (the "PARTICIPATION AGREEMENT"). Each eligible employee or
consultant who is a party to an effective Participation Agreement is referred to
herein as a "PARTICIPANT."
5. STOCK PAYMENTS
Each Participant shall be issued a number of shares of Common Stock
equal to the quotient of 30% of the amount of his or her gross base salary for a
given month before giving effect to the Salary Reduction, divided by the Fair
Market Value of one share of Common Stock for that month. Subject to the
provisions of Section 12 below, Common Stock issuable under the Plan shall be
issued as of the last day of each calendar month during the term of the Plan.
Each issuance of Common Stock under the Plan is referred to as a "STOCK
PAYMENT." "FAIR MARKET VALUE" of one share of Common Stock for any given month
shall be:
(a) the quotient of (i) the total sum, for all business days during the
subject month, of the product of (1) the last reported sales price for a
share of Common Stock on each business day of the month in respect of
which a Stock Payment is to be made, as such price is quoted on the
National Association of Securities Dealers Automated Quotation System
("NASDAQ") in respect of NASDAQ Small Cap Market securities, multiplied
by (2) the NASDAQ trading volume of the Common Stock on each such
business day, divided by (ii) the total sum of the NASDAQ trading volume
of the Common Stock for all such business days during the subject month;
or
(b) if not so quoted, the average of the average of the closing bid and
asked prices for a share of Common Stock on each business day of the
month in respect of which a Stock Payment is to be made, as quoted by
the National Quotation Bureau's "Pink Sheets" or the National
Association of Securities Dealers' OTC Bulletin Board System; or
(c) if the price of a share of Common Stock shall not be so reported,
the Fair Market Value of a share of Common Stock shall be determined by
the Board or Committee in its absolute discretion.
-2-
<PAGE>
6. TRANSFER RESTRICTIONS
No right of any Participant hereunder is assignable except by will or by
the laws of descent and distribution. Transactions under the Plan are intended
to comply with all applicable conditions of Rule 16b-3 or its successors under
the 1934 Act. To the extent any provision of the Plan or action by the Board or
Committee fails to so comply, such provision or action shall be deemed null and
void to the extent permitted by applicable law and deemed advisable by the Board
or Committee. Notwithstanding any other provision of the Plan, until the
expiration of six months and one day after the date upon which Common Stock is
issued under the Plan, no such Common Stock issued to any person subject to
Section 16(b) in a transaction which has not been approved by the Board,
Committee or stockholders shall be sold, assigned, transferred, pledged,
hypothecated or otherwise disposed of except by will or by the laws of descent
and distribution. Any stock certificate(s) issued in respect of a Stock Payment
to a person who is subject to Section 16(b) will set forth these transfer
restrictions. Any attempted disposition in violation of this Section 6 shall be
null and void.
7. RIGHTS AS A STOCKHOLDER
No person shall have any rights as a stockholder with respect to any
shares of Common Stock issuable under the Plan until the date of the issuance of
a stock certificate with respect to such shares.
8. CERTAIN SECURITIES MATTERS
(a) Notwithstanding any other provision of the Plan,
(i) the Company shall not be obligated to cause to be issued or
delivered any certificate evidencing shares of Common Stock issuable under the
Plan unless and until the Company is advised by its counsel that the issuance
and delivery of such certificate is in compliance with all applicable laws and
regulations promulgated by governmental authority and all requirements of any
securities exchange or quotation system on which shares of Common Stock are then
traded or quoted; and
(ii) the Company shall be under no obligation to register,
qualify or perfect an exemption from registration under federal or applicable
state securities laws and regulations any shares of Common Stock issuable under
the Plan. The Board or Committee may require, as a condition to the issuance and
delivery of certificates evidencing shares of Common Stock issuable under the
Plan, that the recipient of such shares make such covenants, agreements and
representations, and that such certificates bear such legends, as the Board or
Committee, in its sole discretion, deems necessary or desirable to comply with
federal and applicable state securities laws and regulations.
(b) Without limiting the generality of Section 8(a)(ii), to the extent
that the issuance of shares of Common Stock under the Plan has not been
registered under the Securities Act of 1933, as amended (the "1933 ACT"), each
Participant, by executing and delivering to the Company a Participation
Agreement, hereby represents and warrants to the Company as of the date of each
Stock Payment, that his or her acquisition of Common Stock as a Stock Payment is
solely for his or her own account for investment, and is not being acquired for
the account of any other person or with a view toward resale, assignment,
fractionalization, or distribution thereof. To the extent that the issuance of
any shares of Common Stock as a Stock Payment has not been registered under
applicable law, any document, instrument or certificate evidencing such Common
Stock will bear a conspicuous legend stating that the Common Stock has not been
registered under the 1933 Act or under any applicable state securities laws, and
that the Common Stock cannot be offered for sale, sold, transferred, pledged or
otherwise hypothecated except in accordance
-3-
<PAGE>
with the registration requirements of the 1933 Act or such state laws or upon
delivery to the Company of an opinion of legal counsel satisfactory to the
Company that an exemption from registration is available.
(c) The Company will use commercially reasonable efforts to cause to be
filed before December 31, 1996 a registration statement on a Form S-8 or Form
S-3 (or comparable successor forms) covering the resale of Common Stock issuable
under the Plan (the "REGISTRATION STATEMENT").
9. CERTAIN TAX MATTERS
Whenever shares of Common Stock are to be issued under the Plan, the
Company shall have the right to require the Participant to remit to the Company
in cash an amount sufficient to satisfy federal, state and local withholding tax
requirements, if any, attributable to such issuance before delivering any
certificate(s) for such shares. If a particular Stock Payment is authorized by
the Board, the Committee or the stockholders, Participants generally recognize
income with respect thereto for federal income tax purposes on the date the
Stock Payment is made regardless of whether a Participant is subject to Section
16(b) of the 1934 Act. The Participant would recognize ordinary income and the
Company would be entitled to a deduction in an amount equal to the fair market
value of the Common Stock as of the date of the Stock Payment.
Certain Participants who are subject to Section 16(b) of the 1934 Act (a
"SUBJECT PARTICIPANT") may not recognize income with respect to a Stock Payment
for federal income tax purposes until expiration of six months and one day after
the Stock Payment is made ("RESTRICTION PERIOD") IF the sale at a profit of the
Common Stock during that period would subject the Participant to liability under
Section 16(b) of the 1934 Act. Under amended Rule 16b-3, this generally would be
the case if the only reason that the Stock Payment is exempt under Rule 16b-3 is
because such person must hold the Common Stock for six months after the date of
issuance. A Subject Participant would not recognize any income for federal tax
purposes at the time Common Stock is issued as a Stock Payment, and the Company
would not be entitled to a deduction at such time. Upon expiration of the
Restriction Period, a Subject Participant would recognize ordinary income and
the Company would be entitled to a deduction in an amount equal to the fair
market value of the Common Stock as of the date of such expiration.
Alternatively, within 30 days after the date upon which Common Stock is issued
as a Stock Payment, a Subject Participant may be able to file an appropriate
election under Section 83(b) of the Internal Revenue Code of 1986, as amended,
with the Internal Revenue Service. The 83(b) election would result in a Subject
Participant's receipt of ordinary income in an amount equal to the fair market
value of the Common Stock on the date on which Common Stock is issued as a Stock
Payment (as opposed to the date upon which the Restriction Period expires). With
respect to Subject Participants, the Company may have discretion to defer
federal income tax withholding until recognition of income is required.
The provisions of this Section 9 are qualified in their entirety by all
applicable laws, rules and regulations as in effect from time to time.
PARTICIPANTS ARE ADVISED TO CONSULT WITH QUALIFIED TAX ADVISORS CONCERNING THEIR
PARTICIPATION IN THE PLAN.
10. NO EMPLOYMENT RIGHTS
Neither this Plan nor any Participation Agreement confers upon any
Participant any right with respect to the continuation of his or her employment
by the Company or interferes in any way with the right of the Company, subject
to the terms of any separate employment to the contrary, at any time to
terminate such employment or to change the compensation of a Participant. If a
Participant's employment with the
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<PAGE>
Company is terminated, such Participant shall be entitled to receive all shares
of Common Stock issuable to him or her hereunder as a Stock Payment(s) for the
period before the effective date of termination.
11. AMENDMENT OF THE PLAN
The Board may at any time suspend or discontinue the Plan or revise or
amend it in any respect whatsoever, PROVIDED, HOWEVER, that no such amendment or
termination shall adversely affect any vested right of a Participant to receive
shares of Common Stock pursuant hereto.
12. EFFECTIVE DATE AND TERM OF PLAN
The Plan is effective as of March 1, 1996. No Common Stock shall be
issued under the Plan until the earlier of the next business day after the
effective date of the Registration Statement (the "EFFECTIVE DATE") or December
31, 1996. The Common Stock which would have been issued under the Plan during
either the period between March 1, 1996 through the end of the calendar month
which immediately precedes the Effective Date or between March 1, 1996 through
December 31, 1996, as applicable, shall be (i) calculated on the same monthly
basis as if Common Stock could have been issued hereunder beginning in March
1996, and (ii) issued as of the next business day after the Effective Date or as
of December 31, 1996, as applicable. Common Stock may be issued under the Plan
until the issuance of all shares of Common Stock which may be issued hereunder
or until the Board determines otherwise, whichever occurs first.
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EXHIBIT 5
November 4, 1996
Texoil, Inc.
1600 Smith Street, Suite 4000
Houston, Texas 77002
Re: TEXOIL, INC. REGISTRATION STATEMENT ON FORM S-8;
AMENDED AND RESTATED 1996 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 200,000 shares ("Shares") of the Company's
common stock, par value $.01 per share ("Common Stock"), issuable pursuant to
the Company's Amended and Restated 1996 Stock Compensation Plan (the "Plan").
We have examined the Plan 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 will, upon issuance and
delivery as contemplated by the Plan, be validly issued, fully paid and
nonassessable outstanding shares of Common Stock.
This Firm consents 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.
EXHIBIT 23.2
CONSENT OF CERTIFIED PUBLIC ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated March 22, 1996, relating to the
financial statements of Texoil, Inc. appearing in the Company's Annual Report on
Form 10-KSB for the year ended December 31, 1995. Our report contains an
explanatory paragraph regarding the Company's ability to continue as a going
concern.
/s/ BDO Seidman, LLP
BDO Seidman, LLP
Houston, Texas
October 31, 1996
EXHIBIT 23.3
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-3 of the 1995 Annual Report of Texoil, Inc. on Form 10-KSB.
/s/ Price Waterhouse LLP
Price Waterhouse LLP
Houston, Texas
October 31, 1996
