AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JUNE 8, 1999
FILE NO. 333-71685
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
AMENDMENT NO. 2 TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
TEXOIL, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C>
NEVADA 88-0177083
(STATE OR OTHER JURISDICTION OF INCORPORATION (I.R.S. Employer Identification No.)
OR ORGANIZATION)
</TABLE>
110 CYPRESS STATION DRIVE, SUITE 220
HOUSTON, TEXAS 77090-1629
(281) 537-9920
(Address including zip code, and telephone number,
including area code of principal executive offices)
FRANK A. LODZINSKI, PRESIDENT
110 Cypress Station Drive, Suite 220
Houston, Texas 77090-1629
(281)-537-9920
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
WITH A COPY TO:
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: FROM TIME TO
TIME AFTER EFFECTIVENESS
If the only securities being registered on this form are being offered pursuant
to dividend or interest reinvestment plans, check the following box. [_]
If any of the securities being registered on this form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [_]
If this form is a post effective, amendment filed pursuant to Rule 462(b) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
<PAGE>
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
CALCULATION OF REGISTRATION FEE(1)
<TABLE>
<CAPTION>
TITLE OF EACH CLASS OF AMOUNT TO BE PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
SECURITIES TO BE REGISTERED OFFERING PRICE PER AGGREGATE REGISTRATION
REGISTERED SHARE (2) OFFERING PRICE(2) FEE (3)
<S> <C> <C> <C> <C>
Common Stock, par $0.01 40,903,462 $0.688 $28,141,582 N/A
</TABLE>
(1) Estimated in accordance with Rule 457 solely for the purpose of calculating
the registration fee.
(2) Based on average closing bid and ask prices on June 3, 1999.
(3) A registration fee of $11,693 was paid with the initial filing on February
1, 1999 based on a price of $0.969 per share. No additional registration
fee is due.
The Registrant hereby amends this Registration Statement on such date or dates
as may be necessary to delay its effective date until the registrant will file a
further amendment which specifically states that this Registration Statement
will thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the Registration Statement will become effective
on such date as the SEC, acting pursuant to said Section 8(a), may determine.
AMENDING: PART I - PROSPECTUS
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<PAGE>
Prospectus SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS
Dated: June 8, 1999
[TEXOIL LOGO]
TEXOIL, INC.
40,903,462
SHARES
Common Stock
RED HERRING LEGEND
You should read this prospectus and any supplement carefully before you
invest.
The common stock is traded on the Boston Stock Exchange and on the NASDAQ
under the symbol "TXLI".
This prospectus is a secondary offering for existing shareholders. It is
being filed so existing shareholders can trade the stock they own, or may own on
exercise of options and warrants. Selling security holders will sell their
common stock into the market directly and Texoil will receive no proceeds on
those sales. If outstanding options and warrants are exercised, net proceeds to
Texoil would be $4,635,422.00. There is no underwriting arrangement.
The securities offered in this prospectus involve a high degree of risk.
Please read the section "Risk Factors" beginning on page 5.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ADEQUACY OR ACCURACY OF THE PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The information in this prospectus is not complete and may be changed. We
may not sell these securities until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus is not an offer
to sell these securities and it is not soliciting an offer to buy these
securities in any state where the offer or sale is not permitted.
This prospectus is dated June 8, 1999.
3
<PAGE>
TABLE OF CONTENTS
PAGE
About This Prospectus........................................... 5
Risk Factors ................................................... 5
Incorporation By Reference...................................... 11
About Texoil ................................................... 11
Available Information........................................... 12
Use of Proceeds................................................. 12
Determination of Offering Price................................. 12
Dilution........................................................ 13
Description of Capital Stock.................................... 15
Nevada Business Corporation Act
And the Articles and Bylaws................................... 16
General................................................... 16
Business Combinations..................................... 16
Directors Duties.......................................... 16
Board of Directors........................................ 16
Shareholder Proposals and Director Nominations............ 17
Meetings of Shareholders.................................. 17
Amendment of Articles and Bylaws.......................... 17
Indemnification........................................... 17
Limitation of Liability................................... 18
Plan of Distribution............................................ 18
Legal Opinions.................................................. 19
Experts......................................................... 19
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<PAGE>
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with the
Securities and Exchange Commission utilizing a "shelf" registration process.
Under this shelf process, selling security holders may, over the next two years,
sell the securities described in this prospectus in a series of offerings up to
a total of 40,903,462 shares. This total consists of 36,846,244 shares currently
issued and 4,057,218 shares issuable under options and warrants. The dollar
amount of the offering will depend on the market price of the shares when they
are sold. This prospectus only concerns the common stock of Texoil, Inc. As
required, we will provide a prospectus supplement to add, update or change
information contained in this prospectus. You should read this prospectus and
any prospectus supplement together with additional information described under
the heading "Available Information".
RISK FACTORS
Before you invest in our common stock, you should be aware that there are
various risks, including those described below. You should carefully consider
these risk factors, together with all the other information included or
incorporated by reference in this prospectus, before you decide whether to
purchase shares of our common stock.
OIL AND GAS PRICES MAY DECLINE
Any sizable and extended decline in the price of oil or gas would have a
harmful effect on the following:
o Texoil's quantities of proved reserves;
o The carrying value of such proved reserves;
o Borrowing capacity;
o Texoil's ability to obtain additional capital; and
o Texoil's revenues, cash flows and profitability from operations.
Texoil's financial condition, operating results, future growth, and the carrying
value of its oil and gas properties are affected by current prices of oil and
gas. Texoil's ability to maintain or increase its borrowing capacity and to
obtain additional capital on attractive terms is also largely dependent upon oil
and gas prices. Prices for oil and gas can change drastically due to factors
beyond Texoil's control. Some factors that Texoil cannot control include the
following:
o Weather conditions in the United States;
o The condition of the United States and/or world economy;
o The actions of the Organization of Petroleum Exporting Countries ;
o Political stability in the Middle East and elsewhere;
o The foreign supply of oil and gas;
o The availability of alternate fuel sources.
5
<PAGE>
RISK FACTORS (CONTINUED)
VALUE OF ASSETS MAY BE WRITTEN DOWN
The SEC requires companies using the full-cost accounting rules to assess
their investments in oil and gas properties for recoverability on a quarterly
basis. The purpose is to confirm that estimated discounted future net revenues
(PV-10 value) from estimated proved reserves on an after-tax basis exceed the
capitalized costs of oil and gas properties and deferred taxes carried on its
balance sheet. This "ceiling test" must generally be performed using oil and gas
prices at the end of the applicable period. Texoil took a write-down in 1998. A
write-down would not affect cash flow from operating activities, but it would
decrease earnings.
DEBT REPAYMENT MAY BE ACCELERATED
A reduction in the value of Texoil's oil and gas properties could result in a
decrease of Texoil's borrowing base. Texoil could be required to repay a portion
of the outstanding debt if the borrowing base is reduced below the amount
required in its financing agreements. Texoil could be required to find new or
different sources of capital to make this debt repayment.
HEDGING ACTIVITIES MAY LIMIT FUTURE REVENUE
In an attempt to reduce its sensitivity to natural gas price volatility,
Texoil has entered into hedging transactions. Additionally, we have hedged our
interest rate exposure by an interest rate swap. Hedging on gas fixes prices
over a predetermined period of time for a portion of its gas production. Hedging
interest rates substitutes a fixed rate for a floating rate. If Texoil's
reserves are not produced at rates equivalent to the hedged position, Texoil
would be required to satisfy its obligation under hedging contracts on
potentially unfavorable terms. Also, Texoil would not have the ability to hedge
that risk through sales of comparable quantities of its own production. Further,
Texoil would enter into hedging contracts under terms which are based on
assumptions and estimates of numerous factors such as cost of production and
pipeline and other transportation costs to delivery points. Texoil may
experience substantial variations between the assumptions and estimates used by
us and actual results achieved. As a result, Texoil could be materially
adversely affected by its actual profit margins and its ability to manage the
risk associated with fluctuations in natural gas prices. Additionally, by
hedging to a fixed price, Texoil limits its benefits if actual prices rise above
the contract prices. Texoil is also subject to the risks that the other party
may prove unable or unwilling to perform its obligations under such hedging
contracts. Texoil could incur a material adverse financial effect if there is
any significant nonperformance. In 1998, Texoil did not hedge any of its oil or
natural gas production.
6
<PAGE>
RISK FACTORS (CONTINUED)
RESERVE REPLACEMENT AND GROWTH RATES MAY DECLINE
Texoil's future performance depends upon its ability to acquire and develop
additional oil and gas reserves that are economically recoverable. Without
successful acquisition, development and exploration activities, Texoil's
reserves and revenues will decline. Prior to the merger with Cliffwood, Texoil
focused its activities almost exclusively on exploration and had only limited
success in replacing its production. New management has diversified activities
by placing greater emphasis on acquisition, re-engineering and development
activities. Although Texoil's management and business strategy, beginning in
1998, has changed, we cannot assure that Texoil will be able to continue to
acquire, develop or discover additional reserves at an economical cost. Some
factors that could make it difficult to continue our growth rate include the
following:
o An inability to obtain growth capital. Texoil is highly leveraged.
o Difficulty in acquiring additional reserves due to competition from
larger, better capitalized companies competing against us for a limited
number of properties that fit our business strategy.
o Insufficient cash flow from operations to finance our growth.
ACQUISITION OF PRODUCING PROPERTIES
Texoil is competing for those properties against many better capitalized
competitors, which makes successful and profitable acquisition of properties
difficult. Assessments of potential income and liabilities are inexact;
therefore, Texoil is uncertain of future financial performance of acquired
properties. In addition, Texoil could be liable for some existing liabilities,
including possible environmental liabilities for such properties. Texoil cannot
assure that any properties acquired by us will be economically produced or
developed. Uneconomical properties could have a material adverse effect on
Texoil.
RE-ENGINEERING OF PRODUCING PROPERTIES MAY NOT BE SUCCESSFUL
Texoil has placed a great emphasis on the acquisition of proven properties,
particularly where such properties are currently producing and provide the
opportunity to increase production through re-engineering and development.
Texoil focuses on re-engineering projects to improve current production, lower
operating costs and increase the return on investment of fields or wells. This
has been an important contributor to our growth. Re-engineering usually involves
the same risks as drilling but with less risk of failure. There is always the
possibility that Texoil will not achieve projected improvements or that the
results will not be sufficient to recover the investment.
DRILLING ACTIVITIES
In addition to our producing activities, Texoil is engaged in drilling
operations. Drilling activity exposes us to risks that are not encountered by a
company that is only involved in producing activities. We are aware that
exploratory and developmental drilling involves significant economic and
operating risks. Texoil may encounter sizeable cost overruns because the cost of
drilling, completing and operating wells is almost always uncertain. Texoil may
experience drilling operation restrictions, delays or cancellations as a result
of numerous factors, many of which are beyond our control. Drilling always
involves the risks of blowouts, dangerous production and other physical hazards.
7
<PAGE>
RISK FACTORS (CONTINUED)
INVESTMENTS SUBJECT TO MANAGEMENT BY THIRD PARTIES
Texoil owns less than 100% of the working interest in many of its oil and gas
properties. Joint operating arrangements are customary in the oil and gas
industry and are generally conducted pursuant to a joint operating agreement,
whereby a single working interest owner is designated as the operator. At
present, Texoil is the "operator" of the majority of its oil and gas properties.
Texoil is also a non-operating working interest owner in numerous wells. For
properties where Texoil owns less than 50% of the working interest, drilling and
operating decisions may not be within our control. If Texoil disagrees with the
decision of a majority of working interest owners, it may be required, among
other things, to do the following:
o Postpone the proposed activity;
o Relinquish or farm-out its interest; or
o Decline to participate.
If Texoil declines to participate, it might be forced to relinquish its interest
or may be subject to certain non-consent penalties, as provided in the
applicable operating agreement. Such penalties typically allow participating
working interest owners to recover from the proceeds of production, if any, an
amount equal to 200%-500% of the nonparticipating working interest owner's share
of the cost of such operations.
Under most operating agreements, the operator has direct and full control
over all operations on the property and is obligated to conduct operations in a
workmanlike manner. However, the operator is usually not liable to the working
interest owners for losses sustained or for liabilities incurred, except those
resulting from its own gross negligence or willful misconduct. Each working
interest owner is generally liable for its share of the cost of developing and
operating jointly owned properties. The operator is required to pay the expenses
of developing and operating the property and will invoice working interest
owners for their proportionate share of such costs. In instances where Texoil is
a non-operating working interest owner, we may have a limited ability to
exercise control over operations and the associated costs of such operations.
Texoil's investment success in such non-operated activities may, therefore, be
dependent upon a number of factors that are outside of our direct control.
Operators may be granted liens on the working interests of other
non-operating owners in the well to secure the payment of amounts owed to the
operator. The bankruptcy or failure of the operator or other working interest
owners to pay vendors who have supplied goods or services applicable to wells
would most likely result in filing of mechanics' and materialmens' liens. These
liens would encumber the well and the interests of all joint owners.
8
<PAGE>
RISK FACTORS (CONTINUED)
UNINSURED OPERATIONAL HAZARDS MAY OCCUR
Texoil's operations are subject to all of the risks normally incident to the
production of oil and gas.Some of these risks include the following:
o Blowouts
o Mechanical failure;
o Casing collapse; and
o Oil spills and fires.
Any one of these risks could result in severe damage to or destruction of oil
and gas wells, production facilities or other property, or injury to persons.
The energy business is also subject to environmental hazards such as oil spills,
gas leaks and ruptures and discharge of toxic substances or gases that could
expose Texoil to substantial liability due to pollution and other environmental
damage. Texoil maintains insurance coverage considered to be customary in the
industry. Although there are currently numerous sources from which such coverage
may be obtained, the following may apply to Texoil's insurance coverage:
o The insurance may not continue to be available to Texoil on commercially
reasonable terms;
o Possible types of liabilities that may be incurred by Texoil may not be
covered by our insurance;
o Insurance carriers may not be able to meet their obligations under the
policies; or
o Dollar amount of the liabilities may go beyond Texoil's policy limits.
The occurrence of even a partially uninsured claim, if successful and of
significant magnitude, could have a material adverse effect on Texoil's
business, results of operations and financial position.
MARKETS FOR SHARES
Shares are traded publicly on the Boston Stock Exchange and the NASDAQ
Small-Cap Market. Such trading markets have certain minimum listing requirements
which include, among other requirements, maintenance of a minimum share price
and net worth. NASDAQ has notified Texoil that it may be delisted from the Small
Cap Market as a result of failure to maintain the minimum bid requirement. We
have appealed the delisting, but absent success on the appeal, Texoil will begin
to trade on the over-the-counter ("OTC") bulletin board. If delisted, Texoil
cannot assure that it will be able to qualify for trading on alternative markets
or be relisted on NASDAQ.
9
<PAGE>
RISK FACTORS (CONTINUED)
FORWARD-LOOKING INFORMATION MAY DIFFER
This prospectus contains "forward-looking statements" within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. You can identify these statements
by forward-looking words such as "may," "will," "expect," "anticipate,"
"believe," "estimate" and "continue" or similar words. You should read
statements that contain these words carefully because they:
o discuss our future expectations;
o contain projections of our future results of operations or of our
financial condition; or
o state other "forward-looking" information.
All statements in this report are forward-looking statements other than those
statements of historical facts. Examples of content that contain forward-looking
statements are as follows:
o Texoil's financial position, reserve quantities and net present values;
o Business strategy, plans, objectives, expectations, intent, and beliefs of
management of Texoil for future operations;
o Capital expenditures; and
o Covenant compliance.
Texoil believes that the expectations reflected in the forward-looking
statements and the basis of the assumptions of such forward-looking statements
are reasonable. However, Texoil cannot assure that such expectations and
assumptions are correct. Important factors that could cause actual results to
differ from Texoil's expectations are discussed throughout the "Risk Factors"
section. Forward-looking statements are not guarantees of future performance.
10
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INCORPORATION BY REFERENCE
The SEC allows us to "incorporate by reference" the information we file with
them. "Incorporate by reference" means that we can disclose important
information to you by referring you to those documents. The information
incorporated by reference is an important part of this prospectus. Information
that we file later with the SEC will automatically update and supersede this
information. We incorporate by reference the documents listed below and any
future filings made with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the
Securities Exchange Act of 1934 until we sell all of the securities included in
this offering.
o Annual Report on Form 10-KSB for the year ended December 31, 1998;
o Quarterly Report on Form 10-QSB for the quarter ended March 31, 1999;
o Current Report on Form 8-K/A-1 filed with the SEC on January 8, 1999.
You may request a copy of these filings at no cost, by writing or telephoning
us at the address below.
You should rely only on the information incorporated by reference or provided
in this prospectus or any prospectus supplement. We have not authorized anyone
else to provide you with different information. We are not making an offer of
these securities in any state where the offer is not permitted. You should not
assume that the information in this prospectus or any prospectus supplement is
accurate as of any date other than the date on the front of those documents.
ABOUT TEXOIL
Texoil, Inc., (or "Texoil") is a Nevada corporation headquartered in Houston,
Texas. Our operating subsidiaries are Cliffwood Oil & Gas Corp. and Cliffwood
Production Co. Both operating subsidiaries are Texas corporations.
Texoil is an independent energy company that acquires and develops oil and
gas reserves. Our program includes purchases of reserves, re-engineering,
development, and exploration activities. Our activities are currently focused in
Texas, South Louisiana and the Texas Gulf Coast.
You can contact us at:
TEXOIL, INC.
110 Cypress Station Drive, No. 220
Houston, Texas 77090-1629
(281) 537-9920 Fax: (281)537-8324
email: [email protected]
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AVAILABLE INFORMATION
We file annual, quarterly, and special reports, proxy statements and other
information with the SEC. Our SEC filings are available to the public over the
Internet at the SEC's web site at "http://www.sec.gov." You may also read and
copy any document we file at the SEC's public reference rooms in Washington,
D.C., New York, New York, and Chicago, Illinois. You may obtain information on
the operation of the public reference rooms by calling the SEC at 1-800-
SEC-0330.
USE OF PROCEEDS
We are filing this registration statement to provide existing shareholders
the ability to trade shares they currently own or that they may own if they
exercise their options or warrants. We will not receive any proceeds from the
sale of any securities being registered that are currently outstanding. If
outstanding options and warrants are exercised, net proceeds to Texoil would be
$4,635,422. Any proceeds received by Texoil resulting from the exercise of
options and warrants will be used for general corporate purposes.
DETERMINATION OF OFFERING PRICE
Texoil, Inc.'s common stock trades publicly on the Boston Stock Exchange and
the NASDAQ Small-Cap Market under the symbol "TXLI." The following table lists
high and low sales prices for the years 1996, 1997 and 1998 of the common stock
as reported on the NASDAQ Stock Market.
TXLI
----
HIGH LOW
---- ---
1996
First Quarter 1 11/16 1 3/16
Second Quarter 1 7/16 7/8
Third Quarter 1 7/8 1
Fourth Quarter 1 7/8 1 1/16
1997
First Quarter 1 7/8 1 1/16
Second Quarter 2 1/16 1 5/16
Third Quarter 1 11/16 1 5/16
Fourth Quarter 1 9/16 31/32
1998
First Quarter 1 3/8 15/16
Second Quarter 1 1/4 30/32
Third Quarter 1 1/4 13/32
Fourth Quarter 1 5/16 1/2
1999
First Quarter 1 3/32 17/32
As of March 31, 1999, approximately 907 holders of record held Texoil's
common stock.
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DILUTION
This is an offering by selling security holders of currently outstanding
shares and shares issuable upon the exercise of certain warrants and options. To
the extent that Texoil issues shares underlying the warrants and/or options and
the book value per share is more than the exercise price per share, there could
be dilution. The exercise prices of the options and warrants range from $.45 to
$3.50.
SELLING SECURITY HOLDERS
# TEXOIL OPTIONS OR
NAME STATE SHARES WARRANTS
- ---- ----- ------ --------
Thomas C. Bennett OK 22,471
BJH Foundation CA 157,333
John A. Brush TX 235,900
Steven C. Collins TX 6,740
Steven C. Collins TX 13,480
FBO Steven C. Collins IRA UTA Charles
Schwab & Co., Inc. CA 40,440
Marc Countiss TX - 5,000
Becky Lea Crews TX 6,740
Jerry M. Crews TX 20,220
Jerry M. Crews TX 1,368,692
FBO Jerry M. Crews, Charles Schwab & Co., Inc.
Custodian TX 260,501
Susan A. Daigle LA 372,951
Paul B. David LA 372,951
William D. Edwards TX 3,370
Energy Capital Investment Company PLC TX 641,806
EnCap Equity 1996 Limited Partnership TX 1,925,419
First Union Capital Partners, Inc. TX 2,246,671 1,128,950
Michael J. Foy CO 185,350 92,675
R. J. Glover Jr. TX 278,025
Robert J. Glover TX 395,975
Richard Jess Glover Sr. TX 497,075
John L. Graves TX 23,551 281,384
Lynn W. Graves TX 92,268
Russel J. Green LA 13,480
Charles Hainebach TX 126,038
Carolina V. Hoehn CA 76,961
Robert A. Hoehn LA 118,000
T. W. Hoehn Jr. CA 2,187,089
T. W. Hoehn III CA 604,429
Ralph D. Hollingshead TX 13,480
FBO Ralph D. Hollingshead, Charles Schwab & Co.,
Inc., Custodian TX 47,180
J. D. Hughes TX - 20,000
Hy-Bon Engineering Company, Inc. TX 224,671
Mark Jensen TX 47,180
Jay Joliat, Trustee MI 730,171
Joliat & Company, Inc. MI 112,336
Gregory K. Jones IL 96,288
Paul M. Kameny and Carol C. Kameny Family Trust
1995 CA 458,320
Iris R. LaJoie, Trustee FL 87,620
Robert E. LaJoie II, Trustee MI 87,620
Sandra J. LaJoie, Trustee UAD 4-11-95 MI 20,220
LaJoie Ventures, LTD. FL 842,500
Kathryn B. Lancaster, Trustee UAD 12-23-82 IN 87,620
The Lincoln National Life Insurance Co. IN 3,521,650 1,760,825
Amy M. Lodzinski TX 6,740
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# TEXOIL OPTIONS OR
NAME STATE SHARES WARRANTS
- ---- ----- ------ --------
Michael A. Lodzinski TX 6,740
Frank A. Lodzinski TX 177,397
Frank A. Lodzinski TX 33,700
Frank Anthony Lodzinski TX 6,740
The Estate of Paschal L. Maisto MA 148,280
Ruben Medrano TX 39,022 100,000
Clarence C. Meyer TX 118,624
Gregory Mikeska TX 10,110
Francis M. Mury TX 20,220
Francis M. Mury TX 631,268
NEMA, Inc. LA 372,951
Evangeline Brooks Parten Trust of 1997 TX 40,440
Jeremy R. Parten TX 40,440
John R. Parten, Custodian for John Austin Parten TX 40,440
John R. Parten and Nancy K. Parten, JT TX 80,880
Arthur J. Price Jr. TX 6,740
Juanita Ramirez TX 3,370
Thomas A. Reiser TX 289,820
Joe C. Richardson Jr. TX - 281,384
RIMCO Partners, L. P. CT 1,351,285
RIMCO Partners, L. P. II CT 1,351,285
RIMCO Partners, L. P. III CT 579,122
RIMCO Partners, L. P. IV CT 1,544,325
Timothy S. Riordan NC 20,220
Ritchie Children's Trust TX 1,112,100
Marcia Mikeska Ritchie TX 10,110
Robert B. Rodgers NJ 141,540
Julie A. Rohrberg IN 20,220
William F. Seagle FL 121,928 50,000
Mandel C. Selber TX 13,480
Mandel C. Selber, III TX 13,480
FBO Mandel C. Selber III, Charles Schwab & Co.,
Inc. Custodian TX 80,880
Silver Hill Joint Venture TX 72,455
Peggy Simpson TX 13,480
Peggy Simpson TX 281,395
William A. Stirling TX 26,960
Charles M. Strain TX 10,000
V & C Energy Limited Partnership TX 7,931,295 337,000
Arnold Van Zanten TX 67,400
Betty B. Williams TX 35,268
Walter L. Williams TX 354,994
James A. Willis TX 193,438
John O. Wolters TX 741,400
Robert W. Young TX 13,480
---------- ---------
36,846,244 4,057,218
========== =========
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DESCRIPTION OF CAPITAL STOCK
As of September 30, 1998, our authorized capital stock was 70,000,000 shares.
Those shares consisted of:
o 10,000,000 shares of preferred stock, none of which were outstanding; and
o 60,000,000 shares of common stock, of which 39,285,094 shares were
outstanding.
This offering will register approximately 93.7% of the total number of shares
issued and outstanding for sale. We are also registering shares that could be
issued upon the exercise of warrants and options listed under "Selling Security
Holders". The warrant and option holders consist of capital providers to
Cliffwood Oil & Gas Corp., who received shares and warrants of Texoil, Inc., in
the merger completed in December 1997, and former executives of Texoil. These
persons received rights to have the shares issuable upon exercise of their
warrants and options registered pursuant to the Merger Agreement (See
"Dilution").
DIVIDENDS
Common shareholders may receive dividends when declared by the Board of
Directors. Texoil has not paid dividends in the past and we do not plan to pay
dividends in the near future. If dividends are ever paid, they may be paid in
cash, stock or other form. The current loan agreements provide that common
shareholders may not receive dividends until we have satisfied our obligations
to creditors.
FULLY PAID
All outstanding shares of common stock are fully paid and non-assessable. Any
additional common stock we issue will also be fully paid and non-assessable.
VOTING RIGHTS
Each share of common stock is entitled to one vote in the election of
directors and other matters. Common shareholders are not entitled to pre-emptive
or cumulative voting rights.
OTHER RIGHTS
We will notify common shareholders of any shareholders' meetings according to
applicable law. If we liquidate, dissolve or wind up our business, either
voluntarily or not, common shareholders will share equally in the assets
remaining after we pay our creditors and preferred shareholders.
TRANSFER AGENTS AND REGISTRARS
ChaseMellon Shareholder Services is the transfer agent and registrar. You may
contact us at the address listed on page 2 or ChaseMellon located at the
following address:
CMSS
Securities Transfer Services
Post Office Box 3312
South Hackensack, New Jersey 07606
1-800-634-9270
15
<PAGE>
NEVADA BUSINESS CORPORATION ACT AND THE ARTICLES AND BYLAWS
GENERAL
Texoil is a Nevada corporation subject to the Nevada Business Corporation
Act. Provisions of the Nevada Act, in addition to provisions of our Articles of
Incorporation and Bylaws, address corporate governance issues, including the
rights of shareholders. Some of the state law provisions could hinder management
changes, while others could have an anti-takeover effect. Texoil has not adopted
any traditional anti-takeover mechanism in the Articles and Bylaws. The
anti-takeover effect of state law may, in some circumstances, reduce the control
premium that might otherwise be reflected in the value of our common stock.
We have summarized the key provisions below. The descriptions are not
complete. You should read the actual provisions of our Articles and Bylaws and
the Nevada Act that relate to your individual investment strategy.
BUSINESS COMBINATIONS
The Nevada Act and our Articles generally require that any merger, share
exchange or sale of substantially all of the assets of a corporation be approved
by at least a majority vote of the outstanding votes entitled to be cast by each
voting group entitled to vote. Nevada had adopted a control share law and a
business combination law that would inhibit the takeover of a Nevada
corporation. The control share law does not apply to Texoil because that statute
requires that at least 100 record holders of Texoil be residents of Nevada and
that Texoil transact business in Nevada. The business combination law, however,
does not have restrictions on residency, and therefore does apply to Texoil.
Under the business combination law, a business combination will be prohibited
for three years unless there is express board approval. The business combination
law automatically applies to Texoil, unless we opt out of the statute and
obtains shareholder approval by those shareholders protected by the statute.
Texoil has not opted out of the business combination provision.
In addition to these two statutes directly related to takeovers, there are
other factors under the articles of incorporation and provisions of Nevada law
that may affect the outcome of a takeover. The Board of Directors of Texoil is
not staggered. A shareholders' rights plan is not in place. Written consents by
less than 100% of the shareholders are possible under Nevada law. It is
difficult to determine whether these provisions would deter or assist in the
takeover of Texoil, but generally, these factors would facilitate a takeover.
DIRECTORS' DUTIES
Under Nevada law, the Board of Directors is charged with the traditional
fiduciary duties, and duties to conduct the business of Texoil in a prudent
manner. Nevada has authorized the Board of Directors to consider other
constituencies besides the shareholders in considering the maximization of
benefits to the Nevada corporation. The Board may consider employees, suppliers,
creditors and customers, the economy of the state of Nevada and the nation, the
interests of the community and society and long-term as well as short-term
benefits to the corporation. Nevada believes that the ability to consider other
constituencies will assist management in resisting a takeover.
BOARD OF DIRECTORS
Members of Texoil's Board of Directors serve for one year or until their
successor is elected.
16
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SHAREHOLDER PROPOSAL AND DIRECTOR NOMINATIONS
Texoil's shareholders may submit shareholder proposals and nominate
candidates for the Board of Directors if the shareholders follow advance notice
procedures described in the proxy materials published each year in connection
with the Annual Meeting. There are no special provisions in Texoil's Bylaws.
To nominate directors, shareholders must submit a written notice to Texoil's
corporate secretary at least 60 days before a scheduled meeting. The notice must
include the following information:
o Name and address of the shareholder;
o Name and address of the nominee;
o Description of any arrangements between the shareholder and the nominee;
o Information about the nominee required by the SEC;
o Written consent of the nominee to serve as a director; and
o Any other material information.
Shareholder proposals must be submitted to Texoil's corporate secretary at
least 120 days before the first anniversary of the date of our last annual
meeting. The notice must include the following information:
o Description of the proposal;
o Reasons for presenting the proposal at the annual meeting;
o Text of any resolutions to be presented;
o Shareholder's name and address;
o Number of shares held by the Shareholder; and
o Any material interest of the shareholder in the proposal.
Director nominations and shareholder proposals that are late or do not
include all required information may be rejected. This could prevent
shareholders from bringing certain matters before an annual or special meeting,
including making nominations for directors. Shareholders are entitled to
directly solicit the other shareholders of Texoil under applicable federal proxy
rules. If they do so, the shareholders do not have to use the proxy of Texoil,
but may prepare their own proxy and request a list of record holders of Texoil
common stock.
MEETINGS OF SHAREHOLDERS
Under Texoil's Bylaws, meetings of the shareholders may be called by the
Chairman of the Board, the President, a majority of the Board of Directors or at
the written request of not less than 10 percent (10%) of the voting power of all
the outstanding shares of the corporation.
AMENDMENT OF ARTICLES AND BYLAWS
Generally, Texoil's Articles may be amended by a majority of the outstanding
votes entitled to be cast by each voting group entitled to vote on a given
matter or at the annual or any regular meeting of the Board of Directors without
prior notice, or at any special meeting if notice of the change is given in the
notice for the meeting.
INDEMNIFICATION
Texoil indemnifies Company officers and directors to the fullest extent
permitted under Nevada law against all liabilities incurred in connection with
their service to us. In addition, Texoil has purchased officer and director
insurance to provide liability protection for the directors.
17
<PAGE>
LIMITATION OF LIABILITY
Texoil's Articles provide that Company directors will not be personally
liable for monetary damages to Texoil for breaches of their fiduciary duty as
directors, unless they violated their duty of loyalty to Texoil or Texoil
stockholders, acted in bad faith, knowingly or intentionally violated the law,
authorized illegal dividends or redemptions or derived an improper personal
benefit from their action as directors. This provision applies only to claims
against directors arising out of their role as directors and not in any other
capacity (such as an officer or employee). Directors remain liable for
violations of the federal securities laws and Texoil retains the right to pursue
legal remedies other than monetary damages, such as an injunction or rescission
for breach of the director's duty of care.
PLAN OF DISTRIBUTION
The securities being registered under this prospectus are a secondary
offering by existing shareholders. The existing shareholders may offer their
securities in one or more transactions on the NASDAQ Small-Cap Market, on the
Boston Stock Exchange, or any other stock exchange on which the shares may be
admitted for trading, in accordance with applicable NASDAQ or exchange rules.
These shareholders may offer their securities in block transactions on the
exchange in accordance with its rules, in negotiated transactions (including the
pledge of shares) or in a combination of any such methods. Prices may be at
market prices prevailing at the time of sale, at prices related to prevailing
market prices, or at negotiated prices through their brokers. No underwriters or
agents are involved. There is no underwriter or any other organized method for
offering the shares registered hereunder.
At present, no officer or director intends to sell any shares. In addition,
all shareholders who hold in excess of 300,000 shares (with the exception of
those discussed immediately below), have agreed to limit any sales to not more
than 15 percent (15%) of their individual holdings
per calendar quarter,
commencing with the effective date of this registration statement. Certain
institutional shareholders are subject to contractual arrangements with Texoil.
These shareholders are listed below:
AFFILIATES OF ENCAP INVESTMENTS
Pursuant to a Registration Rights Agreement dated May 4, 1998, EnCap Equity
1996 Limited Partnership and Energy Capital Investment Company, PLC have the
right to have registered under a Form S-3 up to 100% of their shares and sell
such shares, in the following percentages and by the following dates:
06/30/98 20%
09/30/98 40%
12/31/98 60%
03/31/99 80%
06/30/99 100%
LINCOLN NATIONAL LIFE INSURANCE
Under a Common Stock and Warrant Purchase Agreement dated August 4, 1997,
Lincoln National Life Insurance Co. has the following rights:
o (i) One demand registration beginning on January 1, 1999, until August 4,
2002;
o (ii) Piggyback registration rights until August 4, 2002 ; and
o (iii) One put option until August 4, 2002.
RIMCO
Under an Amended and Restated Stock Ownership and Registration Rights
Agreement dated December 31, 1997, RIMCO Partners, L.P. and three affiliated
limited partnerships have rights to two demand registration rights upon
request of a majority of the holders among the
18
<PAGE>
four partnerships and piggyback registration rights for all limited
partnerships.
FIRST UNION CAPITAL MARKETS
Under a Common Stock and Warrant Purchase Agreement dated May 5, 1997, First
Union Capital Partners, Inc., has one demand registration beginning January
1, 1999, until May 31, 2005, piggyback registration rights until May 31,
2005, a preemptive rights provision and a put option beginning on May 27,
2001.
Upon the effectiveness of this registration statement and provided this
statement remains effective, Texoil believes that the registration obligation to
these four institutions will be satisfied. The total number of shares entitled
to registration by each of these four institutions is listed under "Selling
Security Holders" above.
LEGAL OPINIONS
Bond & Taylor, LLP, will issue an opinion about the legality of the offered
securities for us.
EXPERTS
The audited financial statements incorporated by reference in this
prospectus and elsewhere in the registration statement have been audited by
Arthur Andersen LLP, independent public accountants, as indicated in their
report with respect thereto, and are included herein in reliance upon the
authority of said firm as experts in giving said report.
19
<PAGE>
[TEXOIL LOGO]
40,903,462
SHARES
COMMON STOCK
PROSPECTUS
20
<PAGE>
PART II
(INFORMATION NOT REQUIRED IN PROSPECTUS)
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
ESTIMATED
---------
Securities and Exchange Commission Fee (ACTUAL) $11,693
Transfer Agent and Registrar Fees 150
Fees and Expenses of Trustees -
Rating Agency Fees -
Printing Expenses 975
Accountants' Fees 7,500
New York Stock Exchange Listing Fee -
Counsel Fees 5,000
Miscellaneous. -
----------
Total $25,318
==========
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Article Ten of Texoil, Inc., Articles of Incorporation mandates
indemnification of its directors and officers to the full extent permitted by
the Nevada General Corporation Law (the "Nevada" Act), and any other applicable
law. The Bylaws of Texoil have been further amended to protect the officers and
directors to the full extent of the laws of the State of Nevada. The Nevada Act
permits a corporation to indemnify its directors and officers against liability
incurred in all proceedings, including derivative proceedings, arising out of
their service to the corporation or to other corporations or enterprises that
the officer or director was serving at the request of the corporation, to the
extent that the person seeking indemnification has acted in good faith and in a
manner which he or she reasonably believed to be in or not opposed to the best
interests of the corporation. In a criminal action or proceeding, the person
must also have had no reasonable cause to believe that his or her conduct was
unlawful. Texoil is required to indemnify its directors and officers in all such
proceedings if they have not violated this standard.
In addition, Article Nine of Texoil, Inc., Articles of Incorporation
limits the liability of its directors and officers to the full extent permitted
by the Nevada Act as now and hereafter in effect. The effect of Texoil's
Articles of Incorporation, together with the Nevada Act, is to eliminate
personal liability of directors and officers for damages for breach of fiduciary
duty, except for acts or omissions which involve intentional misconduct, fraud,
or a knowing violation of law; or the payment of dividends in violation of
Nevada law.
Texoil, Inc. has purchased directors' and officers' liability insurance
policies.
21
<PAGE>
ITEM 16. EXHIBITS.
2.2 Agreement and Plan of Merger, dated December 31, 1997, by and among
Texoil, Inc., Texoil Acquisition, Inc., and Cliffwood Oil & Gas Corp.
(incorporated by reference to Exhibit 2.1 to Item
7 of Form 8-K filed on January 8, 1998).
3.1 Restated Articles of Incorporation of Texoil, Inc., as amended
(Incorporated by reference to Exhibit 3.1 of Form S-3 filed February 1,
1999).
3.2 Amended and Restated Bylaws of Texoil, Inc., as amended (Incorporated by
reference to Exhibit 3.2 of Form S-3 filed February 1, 1999).
4.1 Form of Warrant Agreement between Texoil, Inc., as Issuer and First
Interstate Bank of Texas, N.A. as Warrant Agent, dated May 26, 1994
(incorporated by reference to Exhibit 4.1 filed with Form 10- KSB dated
December 31, 1997).
4.2 Specimen certificate for Class A Warrant (incorporated by reference to
Exhibit 4.2 filed with Form
10-KSB dated December 31, 1997).
4.3 Specimen certificate for Class B Warrant (incorporated by reference to
Exhibit 4.3 filed with Form
10-KSB dated December 31, 1997).
4.4 Specimen certificate for Underwriters Class A Warrant (incorporated by
reference to Exhibit 4.4 filed with Form 10-KSB dated December 31, 1997).
4.5 Specimen certificate for Underwriters Class B Warrant (incorporated by
reference to Exhibit 4.5 filed with Form 10-KSB dated December 31, 1997).
4.6 Specimen certificate for shares of Common Stock, par value $.01 per share
(incorporated by reference to Exhibit 4.6 filed with Form 10-KSB dated
December 31, 1997).
4.7 Note Purchase Agreement, dated December 31, 1997, by and among Texoil,
Inc., and Resource Investors Management Company (incorporated by reference
to Exhibit 5.1 to Form 8-K filed on January 8, 1998).
4.8 Form of the Texoil, Inc., 7.875% Convertible Subordinated General
Obligation Note (incorporated by reference to Exhibit 5.2 to Form 8-K
filed on January 8, 1998).
4.9 Amended and Restated Stock Ownership and Registration Rights Agreement
among Texoil, Inc., and RIMCO Partners, L.P., RIMCO Partners, L.P. II,
RIMCO Partners, L.P. III, and RIMCO Partners, L.P. IV, dated December 31,
1997 (incorporated by reference to Exhibit 5.5 to Form 8-K filed on
January 8, 1998).
4.10 Guaranty Agreement dated December 31, 1997, by and among Cliffwood Oil &
Gas Corp., and RIMCO Partners, L.P., RIMCO Partners, L.P. II, RIMCO
Partners, L.P. III, and RIMCO Partners, L.P. IV, (incorporated by
reference to Exhibit 5.3 to Form 8-K filed on January 8, 1998).
22
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4.11 Guaranty Agreement dated December 31, 1997, by and among Texoil Company
and RIMCO Partners, L.P., RIMCO Partners, L.P. II, RIMCO Partners, L.P.
III, and RIMCO Partners, L.P. IV (incorporated by reference to Exhibit 5.4
to Form 8-K filed on January 8, 1998).
4.12 Acquisition and Distribution Agreement dated May 4, 1998, by and between
Texoil, Inc., Cliffwood Oil & Gas Corp., and Cliffwood Acquisition 1996
Limited Partnership (incorporated by reference to Exhibit 2.1 filed with
Form 8-K on May 12, 1998).
4.13 May 1998 Agreement in Respect of Agreement of Limited Partnership dated
May 4, 1998, by and
among Cliffwood Oil & Gas Corp., EnCap Equity 1996 Limited Partnership
and Energy Capital
Investment Company PLC (incorporated by reference to Exhibit 2.2 filed
with Form 8-K on May 12,
1998).
4.14 Registration Rights Agreement dated May 4, 1998, by and among Texoil,
Inc., EnCap Equity 1996 Limited Partnership and Energy Capital Investment
Company PLC (incorporated by reference to Exhibit 2.3 filed with Form 8-K
on May 12, 1998).
4.15 First Amended and Restated Agreement of Limited Partnership dated May 4,
1998, by and among Cliffwood Oil & Gas Corp., EnCap Equity 1996 Limited
Partnership and Energy Capital Investment Company PLC (incorporated by
reference to Exhibit 2.5 filed with Form
8-K on May 12, 1998).
4.16 Co-Sale Agreement dated May 4, 1998, by and among Cliffwood Oil & Gas
Corp., Cliffwood
Acquisition 1998 Limited Partnership, EnCap Equity 1996 Limited
Partnership and Energy Capital
Investment Company PLC (incorporated by reference to Exhibit 2.6 with
Form 8-K on May 12,
1998).
4.17 Common Stock and Warrant Purchase Agreement between Cliffwood Oil & Gas
Corp., and Belleview 1992 Income Fund L.P. dated as of August 4, 1997
(incorporated by reference to Exhibit 10.20 with Form 10-KSB filed on
April 8, 1998).
4.18 Common Stock and Warrant Purchase Agreement between Cliffwood Oil & Gas
Corp., and First Union Capital Partners, Inc., dated as of May 30, 1997
(incorporated by reference to Exhibit 10.30 with Form 10-KSB filed on
April 8, 1998).
5.1 Legal Opinion of Bond & Taylor, LLP (filed herewith).
16.1 Letter dated March 9, 1998, from BDO Seidman LLP to the Commission
(incorporated by reference to Exhibit 16.1 to Form 8-K filed on
March 9, 1998).
23
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21.1 Following are Texoil's subsidiaries:
<TABLE>
<CAPTION>
NAME OF SUBSIDIARY OTHER NAME UNDER
INCORPORATION/ORGANIZATION SUBSIDIARY CONDUCTS BUSINESS JURISDICTION OF
- -------------------------- ---------------------------- ---------------
<S> <C> <C>
Cliffwood Oil & Gas Corp. None Texas
Cliffwood Production Co. None Texas
New Cliffwood Company None Texas
Cliffwood Exploration Company None Texas
Cliffwood Acquisition - 1996 Limited PartnershiP None Texas
Cliffwood-Blue Moon Joint Venture, Inc. None Texas
Texoil Company None Tennessee
</TABLE>
23.1 Consent of Arthur Andersen LLP (FILED HEREWITH).
23.2 Consent of Bond & Taylor LLP - Contained in Exhibit 5.1.
27.1 Financial Data Schedule (FILED HEREWITH).
ITEM 17. UNDERTAKINGS
The undersigned registrant hereby undertakes the following:
(1) To file, during any period in which offers or sales are being made,
a post effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set
forth in the registration statement. 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 and of the
estimated maximum offering range may be reflected in the form of
prospectus filed with the SEC pursuant to Rule 424(b), if, in the
aggregate, the changes in volume and price represent no more than 20
percent change in the maximum aggregate offering price set forth in
the "Calculation of Registration Fee" table in the effective
registration statement.
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement provided, however, that paragraphs (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 with or furnished to the SEC by
the registrant pursuant
24
<PAGE>
to Section 13 or Section 15(d) of the Securities Exchange Act of
1934 that are incorporated by reference in this registration
statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment will be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time will
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.
(4) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing
of the registrant's annual report pursuant to Section 13(a) or 15(d) of
the Securities Exchange Act of 1934 (and, where applicable, each filing
of an employee benefit plan's annual report pursuant to Section 15(d) of
the Securities Exchange Act of 1934) that is incorporated by reference
in the registration statement will be deemed to be a new registration
statement relating to the securities offered therein, and the offering
of such securities at that time will be deemed to be the initial bona
fide offering thereof.
(5) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the 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 Act and is, therefore,
unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the
registrant in the successful defense of any action, suit or proceeding)
is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will,
unless in the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of
such issue.
(6) The undersigned registrant hereby further undertakes:
(i) For purposes of determining any liability under the Securities
Act of 1933, the information omitted from the form of prospectus
filed as part of this registration statement in reliance upon Rule
430A and contained in a form of prospectus filed by the registrant
pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act
will be deemed to be part of this registration statement as of the
time it was declared effective.
(ii) For the purpose of determining any liability under the
Securities Act of 1933, each post-effective amendment that contains
a form of prospectus will be deemed to be a new registration
statement relating to the securities offered therein, and the
offering of such securities at that time will be deemed to be the
initial bonafide offering thereof.
25
<PAGE>
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT MEETS ALL OF THE
REQUIREMENTS FOR FILING ON FORM S-3, AND HAS DULY CAUSED THIS REGISTRATION
STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY
AUTHORIZED, IN THE CITY OF HOUSTON, THE STATE OF TEXAS, ON THE DATE INDICATED.
TEXOIL, INC.
BY: /s/ FRANK A. LODZINSKI
FRANK A. LODZINSKI
PRESIDENT AND CHIEF EXECUTIVE OFFICER
DATE SIGNED: JUNE 8, 1999
PURSUANT TO REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS REGISTRATION
STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE CAPACITIES
INDICATED, ON THE DATE INDICATED.
SIGNATURE TITLE
--------- -----
/s/ FRANK A. LODZINSKI Director and President, Chief Executive Officer
Frank A. Lodzinski and Principal Accounting Officer
Date Signed: JUNE 8, 1999
/s/ JERRY M. CREWS Director and Secretary
Jerry M. Crews
Date Signed: JUNE 8, 1999
26
<PAGE>
/s/ T. W. HOEHN III Director
T. W. Hoehn III
Date Signed: JUNE 8, 1999
/s/ ROBERT E. LAJOIE Director
Robert E. LaJoie
Date Signed: JUNE 8, 1999
/s/ THOMAS A. REISER Director
Thomas A. Reiser
Date Signed: JUNE 8, 1999
/s/ MICHAEL A. VLASIC Director
Michael A. Vlasic
Date Signed: JUNE 8, 1999
27
EXHIBIT 5.1 - LEGAL OPINION
BOND & TAYLOR, L.L.P
1021 Main, Suite 1220
Houston, Texas 77002
June 7, 1999
Texoil, Inc.
110 Cypress Station Dr., Suite 220
Houston, Texas 77090
Ladies and Gentlemen:
We have acted as counsel for Texoil, Inc. (the "COMPANY") in connection
with the registration under the Securities Act of 1933, as amended, of
36,846,244 issued and outstanding shares of the Company's $.01 par value common
stock (the "COMMON STOCK"), as well as 4,057,218 shares of Common Stock issuable
upon the exercise of certain options and warrants, all on Form S-3, as amended.
We have examined the Company's Articles of Incorporation, as amended, its
Bylaws, as amended and the record of its corporate proceedings with respect to
the
registration described above.
In addition, we have examined such other certificates, agreements, documents and
papers, and we have made such other inquiries and investigations of law as we
have deemed appropriate and necessary in order to express the opinion set forth
in this letter. In our examinations, we have assumed the genuineness of all
signatures, the authenticity of all documents submitted to us as originals,
photostatic, or conformed copies and the authenticity of the originals of all
such latter documents. In addition, as to certain matters we have relied upon
certificates and advice from various state authorities and public officials, and
we have assumed the accuracy of the material and the factual matters contained
therein.
Subject to the foregoing, it is our opinion that the shares of Common
Stock, transfer of which is being registered by the Company at the current time,
and will be, if and when issued, sold and delivered as described in the
Company's Registration Statement on Form S-3, as amended (the "REGISTRATION
STATEMENT"), legally issued, fully paid and non-assessable shares of the
Company's Common Stock.
We hereby consent (i) to be named in the Registration Statement, as
amended, and in the prospectus that constitutes a part thereof, as the attorneys
passing upon the validity of the issuance of the Common Stock on behalf of the
Company and, (ii) to the filing of this opinion as an Exhibit to the Company's
Registration Statement, as amended.
This opinion is to be used solely for the purpose of the registration of
the Common Stock and may not be used for any other purpose.
Sincerely yours, BOND & TAYLOR, L.L.P.
By: /s/ ADRIENNE RANDLE BOND
Adrienne Randle Bond
28
EXHIBIT 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this Registration Statement of our report dated March 22, 1999,
included in Texoil, Inc.'s Annual Report on Form 10-KSB for the year ended
December 31, 1998, and to all references to our Firm included in this
Registration Statement.
/s/ ARTHUR ANDERSEN LLP
Arthur Andersen LLP
Houston, Texas
June 7, 1999
29
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THE FINANCIAL DATA SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM TEXOIL'S QUARTERLY REPORT, CONSOLIDATED FINANCIAL STATEMENTS FOR THE THREE
MONTHS ENDED MARCH 31, 1999, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO
SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> MAR-31-1999
<CASH> 564
<SECURITIES> 0
<RECEIVABLES> 3,003
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 3,742
<PP&E> 51,117
<DEPRECIATION> (6,318)
<TOTAL-ASSETS> 49,905
<CURRENT-LIABILITIES> 6,310
<BONDS> 0
0
0
<COMMON> 393
<OTHER-SE> 11,085
<TOTAL-LIABILITY-AND-EQUITY> 49,905
<SALES> 3,827
<TOTAL-REVENUES> 4,073
<CGS> 1,776
<TOTAL-COSTS> 447
<OTHER-EXPENSES> 1,025
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 547
<INCOME-PRETAX> 278
<INCOME-TAX> (105)
<INCOME-CONTINUING> 173
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 173
<EPS-BASIC> 0
<EPS-DILUTED> 0
</TABLE>
