As Filed With the Securities and Exchange Commission on
October __, 1995
Registration Statement No. 33-91452
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
AMENDMENT NO. 1 TO FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
DELTA PETROLEUM CORPORATION
(Exact Name of registrant in its Charter)
Colorado 0-16203 84-1060803
State or other Primary Standard (I.R.S. Employer
jurisdiction Industrial Class- Identification
of incorporation ification Code No.)
or organization Number
Suite 3310, 555 17th Street, Denver, Colorado 80202
(303) 293-9133
(Address and telephone number of principal executive offices and
principal place of business)
Aleron H. Larson, Jr., Chairman/C.E.O.
Delta Petroleum Corporation
Suite 3300, 555 17th Street
Denver, Colorado 80202
(303) 293-9133
(Name, address and telephone number of agent for service)
Copies to:
STANLEY F. FREEDMAN, ESQ.
Krys Boyle Golz Reich Freedman & Scott, P.C.
600 Seventeenth Street, Suite 2700 South
Denver, Colorado 80202-5427
(303) 893-2300
Approximate date of commencement of proposed sale to the public:
As soon as practicable after the effective date of this
Registration Statement.
If the only securities being registered on this Form are being
offered pursuant to dividend or interest reinvestment plans,
please 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
CALCULATION OF REGISTRATION FEE
Title of Class of
Securities to be Amount to be
Registered Registered
Common Stock, $.01 Par Value 1,360,888
Common Stock, issuable under
currently outstanding options
and warrants 1,187,000
Title of Class of Proposed Maximum
Securities to be Offering Price
Registered Per Unit (1)
Common Stock, $.01 Par Value $7.75
Common Stock, issuable under
currently outstanding options
and warrants $6.88 (2)
Title of Class of Proposed Maximum
Securities to be Aggregate
Registered Offering Price (1)
Common Stock, $.01 Par Value $10,546,882
Common Stock, issuable under
currently outstanding options
and warrants $8,168,750
Title of Class of Amount of
Securities to be Registration
Registered Fee
Common Stock, $.01 Par Value $3,636.86
Common Stock, issuable under
currently outstanding options
and warrants $2,816.81
Total Registration Fee $6,453.67
(1) Estimated solely for the purpose of computing the amount of
registration fee.
(2) Average exercise price for aggregate options and warrants.
The registrant hereby amends this registration statement on such
date or dates as may be necessary to delay its effective date
until the registrant shall file a further amendment which
specifically states that this registration shall thereafter
become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the registration statement shall
become effective on such date as the Commission, acting pursuant
to said Section 8(a), may determine.
SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS DATED
OCTOBER __, 1995
DELTA PETROLEUM CORPORATION
2,547,888 Shares of Common Stock
$0.01 par value per share
All of the Common Stock, $0.01 par value (the "Common
Stock"), of Delta Petroleum Corporation ("Delta" or the
"Company") registered hereunder is for the account of the owners
(collectively, the "Selling Shareholders") who acquired their
shares in private transactions prior to the date hereof.
The Company will not receive any proceeds from the sale of
the Common Stock sold by the Selling Shareholders.
The Company's Common Stock is traded on the National
Association of Securities Dealers Automated Quotation System
("NASDAQ") under the symbol "DPTR." On October 9, 1995, the last
reported bid price for the Common Stock on NASDAQ was $7.75.
This prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of
these securities in any State in which such offer, solicitation
or sale would be unlawful prior to registration or qualification
under the securities laws of any such state.
THE SECURITIES OFFERED HEREBY INVOLVE A HIGH DEGREE OF RISK
AND IMMEDIATE SUBSTANTIAL DILUTION. THESE SECURITIES SHOULD BE
PURCHASED ONLY BY PERSONS WHO CAN BEAR THE ECONOMIC RISK OF THIS
INVESTMENT. SEE "RISK FACTORS" AND "DILUTION."
____________________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY
THE SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The Company anticipates that sales may be effected from time
to time, by or for the accounts of the Selling Shareholders, in
the NASDAQ market, in negotiated transactions, or otherwise.
Sales will be made through broker-dealers acting as agent for the
Selling Shareholders or to broker-dealers who may purchase the
Common Stock as principals and thereafter sell the shares from
time to time in the NASDAQ market, in negotiated transactions, or
otherwise. Sales will be made at market prices prevailing at the
times of the sales or at negotiated prices, although one Selling
Shareholder has agreed that it will not sell the shares at less
than the higher of $6.875 per share or the bid price on the
effective date of this Prospectus unless otherwise agreed upon by
the Company and such Selling Shareholder. See "Plan of
Distribution."
The date of this Prospectus is October __, 1995
AVAILABLE INFORMATION
The Company is subject to the information requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"),
and in accordance therewith files reports and other information
with the Securities and Exchange Commission (the "Commission").
Such reports and other information filed by the Company can be
inspected and copied at the public reference facilities of the
Commission at Room 1024, Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549, and at the Regional Offices of the
Commission located at 7 World Trade Center, New York, New York
10048 and 500 West Madison, 14th Floor, Chicago, Illinois 60661.
Copies can be obtained by mail at prescribed rates. Requests for
copies should be directed to the Commission's Public Reference
Section, Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C.
20549.
The Company has filed with the Commission a Registration
Statement on Form S-3 (together with all exhibits, amendments and
supplements, the "Registration Statement") of which this Prospectus
constitutes a part, under the Securities Act of 1933, as amended
(the "Securities Act"). This Prospectus does not contain all of
the information set forth in the Registration Statement, certain
parts of which are omitted in accordance with the rules of the
Commission. For further information pertaining to the Company,
reference is made to the Registration Statement. Statements
contained in this Prospectus or any document incorporated herein by
reference concerning the provisions of documents are necessarily
summaries of such documents, and each such statement is qualified
in its entirety by reference to the copy of the applicable document
filed with the Commission. Copies of the Registration Statement
are on file at the offices of the Commission, and may be inspected
without charge at the offices of the Commission, the addresses of
which are set forth above, and copies may be obtained from the
Commission at prescribed rates.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following Company documents shall be deemed to be
incorporated in this Prospectus and to be a part hereof from the
date of the filing of such documents:
1. Annual Report on Form 10-KSB for the fiscal year ended June
30, 1995.
2. Current Report on Form 8-K dated August 18, 1995.
3. All documents subsequently filed by the Company pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange
Act of 1934, prior to the termination of the offering
described herein.
Any statement contained in a document incorporated by reference
herein shall be deemed to be modified or superseded for all
purposes to the extent that a statement contained in this
Prospectus or in any other subsequently filed document which is
also incorporated herein by reference modifies or replaces such
statement. Any such statement so modified or superseded shall not
be deemed, except as so modified or superseded, to constitute a
part of this Prospectus.
The Company will provide without charge to each person to whom this
Prospectus is delivered, on written or oral request of such person,
a copy (without exhibits) of any or all documents incorporated by
reference in this Prospectus. Requests for such copies should be
directed to Aleron H. Larson, Jr., Delta Petroleum Corporation,
Suite 3310, 555 17th Street, Denver, Colorado 80202, or (303) 293-
9133.
THE COMPANY
General
Delta Petroleum Corporation (the "Company") is a Colorado
corporation organized December 21, 1984 and maintains its principal
executive offices at Suite 3310, 555 Seventeenth Street, Denver,
Colorado, 80202.
The Company is engaged in the acquisition, operation,
exploration and development of oil and gas properties. As of June
30, 1995, the Company had varying interests in 80 gross (11.51 net)
productive wells located in four states. The Company has
undeveloped properties in four states, including interests in four
federal units and one lease offshore California. Fourteen of the
Company's wells are operated by the Company. The remaining wells
are operated by independent operators. All Company wells are
operated under contracts that are standard in the industry. The
Company does not presently have any foreign operations, although it
does own equitable rights and/or interests in a proposed
geophysical service and exploration contract for offshore
properties in the Philippines. At June 30, 1995, the Company
estimated its proved reserves attributable to its onshore
properties to be 121,000 Bbls of oil and 4.16 Bcf of gas, of which
43,000 Bbls of oil and 2.55 Bcf of gas are proved developed
reserves. At June 30, 1995, the Company estimated its proved
undeveloped reserves attributable to its offshore California
properties, based upon reserve reports, to be 57.05 million Bbls of
oil and 62.1 Bcf of gas including the Ogle Interests described
below. See, however, the discussion with respect to offshore
California reserves and "RISK FACTORS -- Uncertainty of Reserve
Estimates."
Effective February 25, 1994, Burdette A. Ogle ("Ogle"), a
21.44% shareholder of Delta, granted Delta an option ("Option") to
acquire working interests in three proved undeveloped offshore
Santa Barbara California, federal oil and gas units ("Interests").
On August 31, 1994, in an addendum to the February 25, 1994
Agreement granting the Option, Ogle agreed to extend the period
during which the Option could be exercised until January 3, 1995 in
consideration of the issuance by Delta to Ogle of warrants to
purchase 100,000 shares of common stock at a price of $8.00 per
share until August 31, 1999 with a call provision whereby Delta may
repurchase any unexercised warrants for an aggregate sum of $1,000
after the stock has traded at $10.00 per share or greater for
thirty consecutive trading days. On January 3, 1995, the Company
exercised its option to acquire these properties from Ogle. Under
the Purchase and Sale Agreement and related assignment and
conveyance of the interests, Ogle immediately assigned and conveyed
the Interests to Delta. The purchase price of $8,000,000 is
represented by a production payment reserved in the documents of
assignment and conveyance and is payable out of three percent (3%)
of the oil and gas production from the Interests. Delta paid Ogle
$250,000 in 1995, is to pay an additional $250,000 in 1996 and a
minimum of $350,000 annually thereafter until: 1) the $8,000,000
purchase price is paid; 2) 80% of the ultimate reserves of any
lease are produced; or 3) 30 years from the date of the
conveyance. Delta already owned other interests in these same
federal units.
Underwriters Financial Group, Inc. Matters
Pursuant to an agreement effective October 21, 1992 and an
agreement effective October 28, 1992, the Company's largest
shareholder and former parent, Underwriters Financial Group, Inc.
("UFG") (formerly, Chippewa Resources Corporation), agreed to
participate in the reorganization and recapitalization of the
Company by transferring its oil and gas related assets ("UFG
Assets") to the Company. UFG has completed the transfer to Delta
of the UFG Assets, which included all of its oil and gas related
assets, the controlling block (88.09%, in aggregate) of Amber
Resources Company ("Amber"), certain producing and non-producing
oil and gas properties, office furniture and equipment, oil field
equipment and receivables. Transfers of 72% of Amber and certain
producing and non-producing oil and gas properties were made
"subject to" existing UFG indebtedness, which indebtedness was not
assumed by the Company but rather remains the obligation of UFG
which is required to repay the indebtedness pursuant to the terms
of the October 28, 1992 agreement.
On February 23, 1995, the Company and UFG executed and entered
into a letter agreement dated February 22, 1995 (the "UFG
Agreement"). Under the terms of the UFG Agreement, the Company
agreed to convert $736,932 of principal and interest due from UFG
under its promissory note dated March 31, 1993 into 491,300 shares
of UFG common stock. In addition, UFG and the Company agreed that
the remaining $736,932 owed by UFG to the Company would be
satisfied by the transfer of 92,117 shares of the Company's common
stock from UFG to the Company. The Company agreed to file a
registration statement covering the remaining 888,063 shares of the
Company's common stock owned by UFG. Included in the shares
registered for sale in this Prospectus are such shares owned by
UFG. Under the UFG Agreement, UFG will have the right to sell all
or some of the Company's shares owned by UFG at a price of not less
than $6.875 or the bid price on the effective date, whichever is
higher, unless otherwise agreed upon by the Company and UFG. Under
the UFG Agreement, an escrow will be established for the 888,063
shares pending sale to assure that the shares are sold pursuant to
the terms of the UFG Agreement and to assure that the first
proceeds are used to discharge UFG's promissory note to Snyder Oil
Corporation ("SOCO") thereby releasing to the Company the Amber
Resources Company common stock held by SOCO as collateral for the
promissory note.
RISK FACTORS
Prospective investors should consider carefully, in addition
to the other information in this Prospectus, the following:
1. Shortages of Working Capital and Funding. Current
liabilities exceeded current assets by $3,715,047 at June 30, 1995.
The Company's working capital deficit is in part a result of the
note payable to SOCO of $2,232,855 at June 30, 1995 which is non-
recourse to Delta and which is payable by its former parent,
Underwriters Financial Group, Inc. UFG's Note to SOCO is currently in
default. In the event that SOCO were to successfully pursue its
remedies under the Note, in the event of an uncured default, it is
possible that the Company's ownership interest in Amber would be
reduced from 91.68% to 19.74% with the resulting consequences as
described below. See "RISK FACTORS--Potential Loss of UFG Assets".
Delta holds 888,063 shares of Delta Common Stock
owned by UFG as collateral for UFG's obligation to pay the full
amount due under the SOCO Note. In the event the Snyder Note is
not paid in full by UFG, Delta will seek to foreclose upon the
collateral and take ownership of these shares. The Company
believes the remaining $1,482,192 deficit can be funded through
operations.
Although management believes that the Company will participate
in the drilling of additional wells during the fiscal year ending
June 30, 1996, the Company's level of oil and gas activities,
including exploration and development and property acquisitions,
will be to a significant extent dependent on the Company's ability
to successfully conclude funding transactions, of which there is no
assurance. Further, contingencies related to the UFG Assets could
materially affect the Company's revenues, cash flow, assets,
reserves and its ability to raise additional capital. See "RISK
FACTORS--Potential Loss of UFG Assets."
2. Potential Loss of UFG Assets. Pursuant to agreements
effective during October 1992 (and a predecessor agreement
effective August 26, 1992), UFG transferred to the Company, as
part of the plan of reorganization and recapitalization, producing
and non-producing oil and gas properties, accounts receivable, oil
field equipment, office furniture and equipment, and 4,110,660
shares of the common stock of Amber Resources Company, which
represented an 88.09% interest in Amber (collectively, "UFG
Assets"). In addition, such transfers were made subject to certain
liabilities of UFG in the aggregate amount of $5,440,532, which
liabilities were not assumed by the Company but rather remain the
obligation of UFG, of which the Note by UFG to SOCO is a part.
UFG's Note to SOCO remains unpaid and is currently in default. In
the event that SOCO were to successfully pursue its remedies under
the Note, in the event of an uncured default, it is possible that
the Company's ownership interest in Amber would be reduced from
91.68% to 19.74% with the resulting consequences as described
below.
The Company has been informed that UFG's independent auditors
and legal counsel have both recently resigned, and the Company
believes there is a significant risk that UFG will be unable to
timely repay one or more of the obligations encumbering the UFG
Assets which could result in a complete loss of the encumbered UFG
Assets. The loss of the encumbered Amber shares would reduce the
Company's ownership interest in Amber to 19.74%. Amber's oil and
gas revenue during the fiscal year ended June 30, 1995 amounted to
approximately $730,000 which constituted approximately 57% of the
Company's consolidated oil and gas revenues. Amber's proved oil
and gas reserves attributable to its onshore properties are
estimated to be 5,100 Bbls of oil and 1.91 Bcf of gas. Amber's
proved undeveloped oil and gas reserves attributable to its
offshore California properties are estimated to be 10,582,000 Bbls
of oil and 12.96 Bcf of gas. A loss of the encumbered Amber shares
would significantly reduce the Company's oil and gas revenue and
reserves and have a material effect on the operations of the
Company.
As of June 30, 1995, UFG had not paid the SOCO obligation,
which is secured by the Amber stock. The Company has negotiated an
agreement with UFG whereby the Company has filed a registration
statement, of which this Prospectus is a part, registering 888,063
shares of the Company owned by UFG. Sales by UFG pursuant to this
Prospectus are to be placed in an escrow for payment to SOCO to
reduce the indebtedness of UFG encumbering the Amber stock. There
can be no assurance that any shares registered for the benefit of
UFG will be sold. See "USE OF PROCEEDS." Delta holds 888,063
shares of Delta Common Stock owned by UFG as collateral for UFG's
obligation to pay the full amount due under the SOCO Note. In the
event the SOCO Note is not paid in full by UFG, Delta will seek to
foreclose upon the collateral and take ownership of these shares.
3. Concerns Relating to Development of Offshore California
Properties. The Company's Offshore California proved undeveloped
reserves are attributable to its interests in four federal units
(plus one additional lease) located offshore California near Santa
Barbara. While these interests represent ownership of substantial
oil and gas reserves classified as proved undeveloped, the cost to
develop the reserves will be very substantial. The Company may be
required to farm out all or a portion of its interests in these
properties if it cannot fund its share of the development costs.
There can be no assurance that the Company can farm out its
interests on acceptable terms. If the Company were to farm out its
interests in these properties, its share of the proved reserves
attributable to the properties would be decreased substantially.
The Company may also incur substantial dilution of its interests in
the properties if it elects to use other methods of financing the
development costs.
These units have been formally approved and are regulated by
the Minerals Management Service of the Federal Government. However,
due to a history of opposition to offshore drilling and production
in California by some individuals and groups, the process of
obtaining all of the necessary permits and authorizations to
develop the properties will be lengthy and even after all required
approvals are obtained, lawsuits may possibly be filed to attempt
to further delay the development of the properties. While the
Federal Government has recently attempted to expedite this process,
there can be no assurance that it will be successful in doing so.
The Company does not have a controlling interest in and does not
act as the operator of any of the offshore California properties
and consequently will not control the timing of either the
development of the properties or the expenditures for development.
Management and its independent engineering consultant have
considered these factors relating to timing of the development of
the reserves in the preparation of the reserve information relating
to these properties. As additional information becomes available
in the future, the Company's estimates of the proved undeveloped
reserves attributable to these properties could change, and such
changes could be substantial.
4. Uncertainty of Reserve Estimates. The reserve estimates,
which are referenced herein and attached as exhibits to the
Company's Annual Report on Form 10-KSB for the fiscal year ending
June 30, 1995, are inherently uncertain until such time as drilling
is completed. Further, such estimates are based upon assumptions
made by analysts or required by the Securities and Exchange
Commission, which assumptions may or may not be accurate.
Consequently, actual production may vary substantially from the
reserve estimates provided, which variance could have a material
effect upon the estimated quantity and value of such reserves.
Further, other engineers could reach different conclusions
regarding the reserves. See "RISK FACTORS--Concerns Relating to
Development of Offshore California Properties."
5. Substantial Costs to Develop Reserves. During the year
ended June 30, 1995, the Company participated in the drilling
and/or completion/recompletion of nine gas wells in Oklahoma.
Management anticipates that the Company will participate in
drilling of a total of twelve to fifteen new wells during the
fiscal year ending June 30, 1995. Although management believes
that the Company will participate in the drilling of additional
wells during the fiscal year, the Company's level of oil and gas
activity, including exploration and development and property
acquisitions, will be to a significant extent dependent on the
Company's ability to successfully conclude funding transactions, of
which there is no assurance.
The Company expects to continue incurring costs to acquire,
explore and develop oil and gas properties, and management predicts
that these costs (together with general and administrative
expenses) will be in excess of funds available from revenues from
properties owned by the Company or existing cash on hand. It is
anticipated that the source of funds to carry out such exploration
and development will come from a combination of the Company's sale
of working interests in oil and gas leases, production revenues,
sales of the Company's securities, and funds from any funding
transactions in which the Company might engage. However, it is not
anticipated that UFG will be a source of funds or properties (as
has been the case in prior years).
6. Dependence on Oil and Gas Prices. The Company's oil and
gas exploration and production activities are dependent on the
actual prices for oil and gas. The prices for oil and gas are
dependent on a number of factors, including the extent of domestic
production and imports of oil; the competitive position of oil and
gas as a source of energy as compared with coal, atomic energy,
hydroelectric power, and other energy sources; the refining
capacity of prospective oil purchasers; the availability and
capacity of pipelines and other means of transportation; and the
effect of federal and state regulation on production,
transportation, and sale of oil and gas. Such factors are beyond
the Company's control or influence. The volatility of prices of
oil and gas, which has been substantial in the past and may
continue to be high in the future, may have material effects on the
Company's liquidity and capital resources. Additionally, the
valuation of the Company's proven and unproven oil and gas
properties and its production revenues could vary and fluctuate
significantly with changes in oil and gas prices.
7. Competition. Oil and gas exploration and acquisition of
undeveloped properties is a highly competitive and speculative
business. The Company competes with a number of other companies,
including major oil companies and other independent operators which
are more experienced and which have greater financial resources.
The Company does not hold a significant competitive position in the
oil and gas industry.
8. Governmental Regulation and Control. The activities of
the Company are subject to extensive federal, state, and local laws
and regulations controlling not only the exploration for and sale
of oil, but also the possible effects of such activities on the
environment. Present as well as future legislation and regulations
could cause additional expenditures, restrictions, and delays in
the Company's business, the extent of which cannot be predicted,
and may require the Company to cease operations in some
circumstances. In addition, the production and sale of oil and gas
are subject to various governmental controls. Because federal
energy policies are still uncertain and are subject to constant
revisions, no prediction can be made as to the ultimate effect of
such governmental policies and controls on the Company.
9. Dependence Upon Operators. The Company operates only a
small portion of most of the wells in which it owns an interest. As such,
the Company is dependent upon the operator of most of its wells to
make most decisions concerning such things as whether or not to
drill additional wells, how much production to take from such
wells, or whether or not to cease operation of certain wells.
While the Company, as a working interest owner, may have some voice
in the decisions concerning the wells, it is not the primary
decision maker concerning them. Therefore, the Company may be
unable to cause wells to be drilled even though it may have the
funds with which to pay its proportionate share of the expenses of
such drilling.
10. General Risks Inherent in Oil and Gas Drilling. The
Company's business is subject to all risks inherent in the
exploration and development of oil and gas properties, including
but not limited to environmental damage, personal injury, and other
occurrences that could result in the Company incurring substantial
losses and liabilities to third parties. In its own activities,
the Company purchases insurance against risks customarily insured
against by others conducting similar activities. Nevertheless, the
Company is not insured against all losses or liabilities which may
arise from all hazards because such insurance is not available at
economic rates, because the operator has not purchased such
insurance, or because of other factors. Any uninsured loss could
have a material adverse effect on the Company.
11. No Long Term Contracts. The Company does not have any
long-term supply or similar agreements with governments or
authorities pursuant to which the Company acts as producer. The
Company, therefore, is dependent upon its ability to sell oil and
gas at the then current prices. There can be no assurance the
purchasers will be available or that the price they are willing to
pay will remain stable.
12. Lack of Diversification. Since all of the Company's
resources are allocated to one business area, purchasers of the
Company's common stock will be risking essentially their entire
investment in a venture that is unable to spread the risk of loss
over several projects with the hope that at least one will succeed.
13. Voting Rights. Holders of the common stock are not
entitled to accumulate their votes for the election of directors or
otherwise. Accordingly, the present shareholders will be able to
elect all of the directors of the Company, and holders of the
common stock offered hereby will not be able to elect a
representative to the Company's Board of Directors. See
"DESCRIPTION OF COMMON STOCK."
14. Lack of Prospective Dividends. There can be no assurance
that the proposed operations of the Company will result in
sufficient revenues to enable the Company to operate at profitable
levels or to generate a positive cash flow. For the foreseeable
future, it is anticipated that any earnings which may be generated
from operations of the Company will be used to finance the growth
of the Company and that dividends will not be paid to holders of
common stock. See "DESCRIPTION OF COMMON STOCK."
15. No Assurance of a Public Market. The Company's common
stock is listed on NASDAQ and trades under the symbol "DPTR." To
date, trading volumes for the Company's common stock have been
relatively light. Average weekly trading volume for the twelve
months ending August 31, 1995 was 21,119 shares. The high bid
during such period was $8.375, while the low bid during the same
period was $4.75.
USE OF PROCEEDS
The Company will not receive any of the proceeds of this
offering except such proceeds as may be received by the Company
upon the exercise of outstanding warrants or options by the selling
shareholders which proceeds, if any, would be used for working
capital and drilling and development of the Company's properties.
However, the Company will obtain a benefit to the extent that
proceeds from the sale of shares by UFG are escrowed for payment to
SOCO as required under the UFG Agreement. See "COMPANY," and "RISK
FACTORS--Potential Loss of UFG Assets." The promissory note to
SOCO totaled $2,232,855 at June 30, 1995, with such note
encumbering 3,357,003 shares of the common stock of Amber, which
represents a 71.94% interest in Amber. To the extent that the SOCO
promissory note is paid in full by UFG, proceeds of any sales of
shares by UFG will be paid directly to UFG, with no benefit to the
Company.
DILUTION
As of June 30, 1995, the Company had 3,550,882 shares of
common stock issued and outstanding with a net tangible book value
of $5,526,608, or $1.56 per share. Net tangible book value per
share represents the amount of the Company's total assets less
total liabilities, divided by the number of shares of common stock
outstanding. The following table sets forth the dilution to be
incurred by investors acquiring common stock.
Assumed Offering Price (1) $7.75
Net tangible book value per share
at June 30, 1995 $1.56
Dilution to Purchasers of common stock $6.19
Dilution to Purchasers as Percentage
of Purchase Price 79.9%
_______________________
(1) Assumes a purchase price of $7.75. The closing bid price of
the Company's common stock on NASDAQ on October 9, 1995 was
$7.75.
The information in the above table does not give effect to the
sale, subsequent to June 30, 1995, of 256,000 shares of the
Company's common stock to third parties for $750,000 with net
proceeds to the Company of $675,000 after payment of certain fees.
While the Company is not receiving any of the proceeds, except
such proceeds as may be received by the Company upon the exercise
of outstanding warrants or options by the selling shareholders,
sales which reduce the obligation to SOCO will have a beneficial
impact upon the Company's net tangible book value, since the
Company has recorded an obligation of $2,232,855 at June 30, 1995
for the note payable by UFG to SOCO. The above dilution figures do
not reflect any increase in net tangible book value as a result of
any payments by UFG on the SOCO obligation. Payments by UFG on the
note payable to SOCO are accounted for as a capital contribution to
the Company by UFG.
If the SOCO obligation were paid in full, the net tangible
book value of the Company would be $7,759,463, or $2.19 per share,
and dilution to purchasers would be $5.56, a percentage dilution of
71.7%. No assurance can be made that UFG will receive funds from
its sale of shares sufficient to repay any amount of the SOCO
obligation.
SELLING SHAREHOLDERS
The following table indicates the Selling Shareholders
currently known to the Company. The calculations are based upon
outstanding shares at October 9, 1995 of 4,029,154.
Number of
Shares of
Common Stock % Held
Owned Prior to Prior to
Name the Offering Offering
Underwriters Financial
Group, Inc. 888,063 1 22.04%
Troy Bates 50,000 1.24%
Bion Environmental
Technologies, Inc. 223,042 5.54%
Marshall Wolf
Invesments 16,000 0.40%
Robert E. Zimmerman, Jr. 2,008 0.05%
Hunt Walker 7,521 0.19%
Carl Burley 6,608 0.16%
John T. Owens and
Deborah Owens 3,135 0.08%
Charles Cavness, Jr. 2,008 0.05%
MDC Group, Inc. 80,000 2 1.96%
Burdette A. Ogle 885,264 3 21.44%
Hunter Equities, Inc. 50,000 4 1.23%
John LeFebvre 13,250 5 0.33%
Americap Invest-
ments, Ltd. 61,250 7 1.50%
Kevin Miller 33,750 9 0.85%
Ken Lucas 95,625 10 2.32%
Craig Scott 47,812 11 1.17%
Glenn Kennedy 47,812 12 1.17%
Corporate Relations
Group, Inc. 310,546 7.71%
Pow Wow, Inc. 300,000 13 6.93%
Fondo de Acquisiciones
E Inversiones
Internacionales
XL SA 300,000 14 6.93%
LoTayLingKyur, Inc. 321,320 15 7.78%
Terry D. Enright 21,200 17 0.52%
Kent Lina 2,000 19 0.05%
Don E. Mettler 10,000 20 0.25%
Total 3,778,214 72.43%
Number of
Shares of % Held
Common Stock After
Common Stock Owned after the
Name to be Sold The Offering Offering
Underwriters Financial
Group, Inc. 888,063 1 0 0%
Troy Bates 50,000 0
Bion Environmental
Technologies, Inc. 20,000 203,042 3.89%
Marshall Wolf
Invesments 16,000 0 0
Robert E. Zimmerman, Jr. 2,008 0 0
Hunt Walker 7,521 0 0
Carl Burley 6,608 0 0
John T. Owens and
Deborah Owens 3,135 0 0
Charles Cavness, Jr. 2,008 0 0
MDC Group, Inc. 80,000 2 0 0
Burdette A. Ogle 100,000 3 785,264 15.05%
Hunter Equities, Inc. 50,000 4 0 0
John LeFebvre 10,000 6 3,250 0.06%
Americap Invest-
ments, Ltd. 50,000 8 11,250 0.21%
Kevin Miller 33,750 9 0 0
Ken Lucas 95,625 10 0 0
Craig Scott 47,812 11 0 0
Glenn Kennedy 47,812 12 0 0
Corporate Relations
Group, Inc. 310,546 0 0
Pow Wow, Inc. 300,000 13 0 0
Fondo de Acquisiciones
E Inversiones
Internacionales
XL SA 300,000 14 0 0
LoTayLingKyur, Inc. 100,000 16 221,320 4.24%
Terry D. Enright 15,000 18 6,200 0.12%
Kent Lina 2,000 19 0 0
Don E. Mettler 10,000 20 0 0
Total 2,547,888 1,230,326 23.59%
Footnotes:
1 UFG is the largest shareholder of the Company, and, until
October 28, 1992, was the parent of the Company. On October 28,
1992, UFG participated in a reorganization and recapitalization
of the Company. Shares of the Company owned by UFG have been
held by the Company as collateral for performance by UFG of its
obligations under the Plan of Reorganization of October 28, 1992.
2 Includes 30,000 shares held of record and 50,000 shares
of the Company's Common Stock underlying currently exercisable
options to purchase shares at an exercise price of $5.00 per
share.
3 Includes 100,000 shares of the Company's Common Stock
underlying a currently exercisable Warrant to purchase 100,000
shares at a purchase price of $8.00, subject to a call provision
by the Company under certain circumstances.
4 Includes 50,000 shares underlying a currently exercisable
Warrant to purchase 50,000 shares of the Company's Common Stock
at a purchase price of $6.00 per share.
5 Includes 3,250 shares held of record and 10,000 shares
underlying a currently exercisable Warrant to purchase shares of
the Company's Common Stock at a purchase price of $6.875 per
share.
6 Shares underlying a currently exercisable Warrant to
purchase 10,000 shares of the Company's Common Stock at a price
of $6.875 per share.
7 Includes 11,250 shares held of record and 50,000 shares
underlying a currently exercisable Warrant to purchase shares of
the Company's Common Stock at a purchase price of $6.875 per
share.
8 Shares underlying a currently exercisable Warrant to
purchase 50,000 shares of the Company's Common Stock at a price
of $6.875 per share.
9 Includes 3,750 shares held of record, 15,000 shares
underlying currently exercisable Warrants to purchase the
Company's Common Stock for $5.50 per share and 15,000 shares
underlying currently exercisable Warrants to purchase the
Company's Common Stock for $8.50 per share.
10 Includes 10,625 shares held of record, 42,500 shares
underlying currently exercisable Warrants to purchase the
Company's Common Stock for $5.50 per share and 42,500 shares
underlying currently exercisable Warrants to purchase the
Company's Common Stock for $8.50 per share.
11 Includes 5,312 shares held of record, 21,250 shares
underlying currently exercisable Warrants to purchase the
Company's Common Stock for $5.50 per share and 21,250 shares
underlying currently exercisable Warrants to purchase the
Company's Common Stock for $8.50 per share.
12 Includes 5,312 shares held of record, 21,250 shares
underlying currently exercisable Warrants to purchase the
Company's Common Stock for $5.50 per share and 21,250 shares
underlying currently exercisable Warrants to purchase the
Company's Common Stock for $8.50 per share.
13 Includes 300,000 shares of the Company's Common Stock
underlying Options which are currently exercisable at $5.50 per
share (as to 75,000 shares), $6.60 per share (as to 75,000
shares), $7.70 per share (as to 50,000 shares), $8.80 per share
(as to 50,000 shares) and $11.00 per share (as to 50,000 shares),
respectively.
14 Includes 300,000 shares of the Company's Common Stock
underlying Options which are currently exercisable at $5.50 per
share (as to 75,000 shares), $6.60 per share (as to 75,000
shares), $7.70 per share (as to 50,000 shares), $8.80 per share
(as to 50,000 shares) and $11.00 per share (as to 50,000 shares),
respectively.
15 Includes 221,320 shares held of record, 50,000 shares of
the Company's Common Stock underlying a currently exercisable
Warrant to purchase shares at $1.25 per share, and 50,000 shares
underlying a currently exercisable option to purchase shares for
$6.00 per share.
16 Shares underlying a currently exercisable Warrant to
purchase 50,000 shares of the Company's Common Stock at a price
of $1.25 per share, and shares underlying a currently exercisable
Warrant to purchase an additional 50,000 shares at a price of
$6.00 per share.
17 Includes 6,200 shares held of record by a company owned
by Mr. Enright and members of his family, 5,000 shares of the
Company's Common Stock underlying a currently exercisable Warrant
to purchase shares at $1.25 per share, and 10,000 shares of the
Company's Common Stock underlying a currently exercisable warrant
to purchase shares at $3.50 per share. Mr. Enright is a director
of the Company.
18 Shares underlying a currently exercisable Warrant to
purchase 5,000 shares of the Company's Common Stock at a price of
$1.25 per share, and shares underlying a currently exercisable
Warrant to purchase 10,000 shares at a price of $3.50 per share.
19 Includes 2,000 shares of the Company's Common Stock
underlying a currently exercisable Warrant to purchase shares at
$1.25 per share.
20 Includes 10,000 shares of the Company's common stock
underlying a currently exercisable warrant to purchase shares at
$3.50 per share. Mr. Mettler is a director of the Company.
The Company will not receive any proceeds from the sale of
Common Stock by any of the Selling Shareholders listed above except
such proceeds as may be received by the Company upon the exercise
of outstanding warrants or options by the selling shareholders.
The Company has agreed to pay for all costs and expenses incident
to the issuance, offer, sale and delivery of the Common Stock,
including, but not limited to, all expenses and fees of preparing,
filing and printing the Registration Statement and Prospectus and
related exhibits, amendments and supplements thereto and mailing of
such items. The Company will not pay selling commissions and
expenses associated with any such sales by any of the Selling
Shareholders. The Selling Shareholders have advised the Company
that sales of shares of the Company's Common Stock may be made from
time to time by and for their respective accounts in one or more
transactions in the over-the-counter market, in negotiated
transactions or otherwise, at prices related to the prevailing
market prices or at negotiated prices, although one Selling
Shareholder (UFG) has agreed that it will not sell the shares at
less than the higher of $6.875 per share or the bid price on the
effective date of this Prospectus unless otherwise agreed upon by
the Company and UFG.
PLAN OF DISTRIBUTION
The Shares may be sold from time to time by the Selling
Shareholders. Such sales may be made in the over-the-counter
market or otherwise at prices and at terms then prevailing or at
prices related to the then current market price, or in negotiated
transactions. The Shares may be sold by one or more of the
following methods: (i) a block trade in which the broker or dealer
so engaged will attempt to sell the Shares as agent for the Selling
Shareholders; and (ii) ordinary brokerage transactions and
transactions in which the broker solicits purchasers. In effecting
sales, brokers or dealers engaged by the Selling Shareholders may
arrange for other brokers or dealers to participate. Brokers or
dealers will receive commissions from the Selling Shareholders in
amounts to be negotiated immediately prior to the sale. Such
brokers or dealers and any other participating brokers or dealers
may be deemed to be "underwriters" within the meaning of the
Securities Act in connection with such sales.
The Selling Shareholders have advised the Company that sales
of the Common Stock registered hereby may be effected from time to
time in transactions (which may include block transactions) in the
NASDAQ market, in negotiated transactions, through the writing of
options on the Common Stock, or a combination of such methods of
sale, at fixed prices which may be charged, at market prices
prevailing at the time of sale, or at negotiated prices. UFG has
agreed, however, that it will not sell the Common Stock at less
than the higher of $6.875 or the bid price on the date of this
Prospectus unless otherwise agreed upon by the Company and UFG.
The Selling Shareholders may effect such transactions by
selling Common Stock directly to purchasers or to or through
broker-dealers which may act as agents or principals. Such broker-
dealers may receive compensation in the form of discounts,
concessions, or commissions from the Selling Shareholders and/or
the purchasers of Common Stock for whom such broker-dealers may act
as agents or to whom they sell as principal, or both. The Selling
Shareholders and any broker-dealers that act in connection with the
sale of the Common Stock might be deemed to be "underwriters"
within the meaning of Section 2(11) of the Act and any commissions
received by them and any profit on the resale of the Common Stock
as principal might be deemed to be underwriting discounts and
commissions under the Act.
The Selling Shareholders may agree to indemnify any agent,
dealer or broker-dealer that participates in transactions involving
sales of the Common Stock against certain liabilities, including
liabilities arising under the Act.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers or
persons controlling the Company pursuant to the foregoing
provisions, the Company has been informed that in the opinion of
the Securities and Exchange Commission such indemnification is
against public policy as expressed in such Act and is therefore
unenforceable.
DESCRIPTION OF COMMON STOCK
The Company is authorized to issue 300,000,000 shares of its
$.01 par value common stock, of which 4,029,154 shares were issued
and outstanding as of October 6, 1995. Holders of common stock are
entitled to cast one vote for each share held of record on all
matters presented to shareholders. Shareholders do not have
cumulative rights; hence, the holders of more than 50% of the
outstanding common stock can elect all directors.
Holders of common stock are entitled to receive such dividends
as may be declared by the Board of Directors out of funds legally
available therefor and, in the event of liquidation, to share pro
rata in any distribution of the Company's assets after payment of
all liabilities. The Company does not anticipate that any
dividends on common stock will be declared or paid in the
foreseeable future. Holders of common stock do not have any rights
of redemption or conversion or preemptive rights to subscribe to
additional shares if issued by the Company. All of the outstanding
shares of the Company's common stock are fully paid and
nonassessable.
The 888,063 shares of the Company's common stock owned by UFG
are subject to a voting agreement with the Company, whereby Aleron
H. Larson, Jr. and Roger A. Parker, the Chief Executive Officer and
President of the Company, respectively, have the right to vote the
shares owned by UFG. The voting agreement does not apply if the
shares are sold to persons who, upon such purchase, would not be
deemed affiliates of the Company or UFG.
EXPERTS
The consolidated balance sheets of the Company as of June 30,
1995 and 1994 and the related consolidated statements of
operations, stockholders' equity, cash flows for the year ended
June 30, 1995, the six months ended June 30, 1994, and the year
ended December 31, 1993, have been incorporated by reference herein
and in the registration statement in reliance upon the report of
KPMG Peat Marwick LLP, independent certified public accountants,
incorporated by reference herein, and upon the authority of said
firm as experts in accounting and auditing.
The report of KPMG Peat Marwick LLP covering the June 30,
1995, financial statements contains an explanatory paragraph that
states that a portion of the shares of Amber Resources Company, a
majority owned consolidated subsidiary of the Company, are pledged
to secure a note payable by the Company's former parent, which note
is currently in default. Significant uncertainty exists as to the
former parent's ability to repay or otherwise satisfy the
obligation. The ultimate outcome of this matter cannot presently
be determined. Accordingly, the consolidated financial statements
do not include any adjustments that would result if the holder of
the note were to foreclose on the Amber shares held as collateral
and the Company were otherwise unable to satisfy the obligation and
retain the shares.
The report of KPMG Peat Marwick LLP covering the June 30, 1995
financial statements also contains an explanatory paragraph that
states that the Company has an investment in certain undeveloped
offshore California properties of $6,786,580 at June 30, 1995. The
Company's ability to ultimately develop the properties is subject
to a number of significant uncertainties, including the operator's
ability to obtain the necessary permits and authorizations relating
to the development activities. Accordingly, the Company's ability
to realize its investment in the offshore California properties is
uncertain and is ultimately dependent on its ability to develop the
properties and/or to sell some or all of its interests in the
properties. Accordingly, the consolidated financial statements do
not include any adjustments that would result if the Company could
not realize its investment in the properties.
The reserve reports of Kent Lina, Petroleum Engineer, with
regard to the Company's onshore reserves and of Mannon and
Associates with regard to the Company's offshore reserves,
incorporated by reference in this Form S-3, are included in
reliance upon the authority of such persons and firms as experts in
petroleum engineering and reserve estimates.
LEGAL MATTERS
The validity of the issuance of the Common Stock offered
hereby will be passed upon for the Company by Krys Boyle Golz Reich
Freedman & Scott, P.C., Denver, Colorado.
NO PERSON IS AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE
ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED OR INCORPORATED BY
REFERENCE IN THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING
BEEN AUTHORIZED. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO
SELL OR A SOLICITATION OF AN OFFER TO BUY ANY SECURITIES OTHER
THAN THE COMMON STOCK OFFERED BY THIS PROSPECTUS. THIS PROSPECTUS
DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO
BUY ANY COMMON STOCK IN ANY CIRCUMSTANCES IN WHICH SUCH OFFER
OR SOLICITATION IS UNLAWFUL. NEITHER THE DELIVERY OF THIS PROSPECTUS
NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES,
CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF
THE COMPANY SINCE THE DATE HEREOF OR THAT THE INFORMATION CONTAINED
BY REFERENCE HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO ITS DATE.
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following table itemizes the estimated expenses to be
incurred by the Company in connection with the issuance and
distribution of the securities being registered hereby.
SEC Registration Fee.................... $ 6,453.67
Transfer Agent Fees..................... -
Legal Fees and Expenses................. 20,000.00
Accounting Fees and Expenses............ 10,000.00
Miscellaneous........................... 10,000.00
Total................................. $46,453.67
Item 15. Indemnification of Directors and Officers.
The Colorado Corporation Code provides that to the extent a
director, officer, employee or agent of a corporation has been
successful on the merits or otherwise in defense of any action,
suit or proceeding or in defense of any claim, issue or matter
therein, he shall be indemnified against expenses (including
attorneys' fees) actually and reasonably incurred by him in connec-
tion therewith. In other circumstances, a director, officer,
employee or agent of a corporation may be indemnified 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 if he acted in good
faith and in a manner he reasonably believed to be in and not
opposed to the best interests of the corporation, and, with respect
to a criminal action or proceeding, had no reasonable cause to
believe his conduct was unlawful; however, in an action or suit by
or in the right of the corporation to procure a judgment in its
favor, such person shall not be indemnified if he has been adjudged
to be liable to the corporation unless and only to the extent that
the court in which such action or suit was brought shall determine
upon application that, despite the adjudication of liability but in
view of all the circumstances of the case, such person is fairly
and reasonably entitled to indemnity for such expenses which the
court shall deem proper. A determination that indemnification of
a director, officer, employee or agent is proper shall be made by
a disinterested majority of the corporation's Board of Directors,
by independent legal counsel, or by the stockholders of the
corporation.
Article X of the Company's Articles of Incorporation provides
as follows:
"ARTICLE X
INDEMNIFICATION
The corporation may:
(A) 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 (other than an action by or in the
right of the corporation), by reason of the fact that he is or was
a director, officer, employee, or agent of the corporation or is or
was serving at the request of the corporation 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, if he acted in good faith
and in a manner he reasonably believed to be in the best interest
of the corporation and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct was
unlawful. The termination of any action, suit, or proceeding by
judgment, order, settlement, or conviction or upon a plea of nolo
contendere or its equivalent shall not of itself create a
presumption that the person did not act in good faith and in a
manner which he reasonably believed to be in the best interest of
the corporation and, with respect to any criminal action or
proceeding, had reasonable cause to believe his conduct was
unlawful.
(B) The corporation 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 or suit by or in the right of the
corporation to procure a judgment in its favor by reason of the
fact that he is or was a director, officer, employee, or agent of
the corporation or is or was serving at the request of the
corporation as a director, officer, employee, or agent of another
corporation, partnership, joint venture, trust or other enterprise
against expenses (including attorneys' fees) actually and
reasonably incurred by him in connection with the defense or
settlement of such action or suit if he acted in good faith and in
a manner he reasonably believed to be in the best interest of the
corporation; but no indemnification shall be made in respect of any
claim, issue, or matter as to which such person has been adjudged
to be liable for negligence or misconduct in the performance of his
duty to the corporation unless and only to the extent that the
court in which such action or suit was brought determines upon
application that, despite the adjudication of liability, but in
view of all circumstances of the case, such person is fairly and
reasonably entitled to indemnification for such expenses which such
court deems proper.
(C) To the extent that a director, officer, employee, or
agent of a corporation has been successful on the merits in defense
of any action, suit, or proceeding referred to in (A) or (B) of
this Article X or in defense of any claim, issue, or matter
therein, he shall be indemnified against expenses (including
attorneys' fees) actually and reasonably incurred by him in
connection therewith.
(D) Any indemnification under (A) or (B) of this Article X
(unless ordered by a court) and as distinguished from (C) of this
Article shall be made by the corporation only as authorized in the
specific case upon a determination that indemnification of the
director, officer, employee, or agent is proper in the
circumstances because he has met the applicable standard of conduct
set forth in (A) or (B) above. Such determination shall be made by
the board of directors by a majority vote of a quorum consisting of
directors who were not parties to such action, suit, or proceeding,
or, if such a quorum is not obtainable or, even if obtainable, if
a quorum of disinterested directors so directs, by independent
legal counsel in a written opinion, or by the shareholders.
(E) Expenses (including attorneys' fees) incurred in
defending a civil or criminal action, suit, or proceeding may be
paid by the corporation in advance of the final disposition of such
action, suit, or proceeding as authorized in (C) or (D) of this
Article X upon receipt of an undertaking by or on behalf of the
director, officer, employee, or agent to repay such amount unless
it is ultimately determined that he is entitled to be indemnified
by the corporation as authorized in this Article X.
(F) The indemnification provided by this Article X shall not
be deemed exclusive of any other rights to which those indemnified
may be entitled under any applicable law, bylaw, agreement, vote of
shareholders or disinterested directors, or otherwise, and any
procedure provided for by any of the foregoing, both as to action
in his official capacity and as to action in another capacity while
holding such office, and shall continue as to a person who has
ceased to be a director, officer, employee, or agent and shall
inure to the benefit of heirs, executors, and administrators of
such a person.
(G) The corporation may purchase and maintain insurance on
behalf of any person who is or was a director, officer, employee or
agent of the corporation or who is or was serving at the request of
the corporation as a director, officer, employee, or agent of
another corporation, partnership, joint venture, trust, or other
enterprise against any liability asserted against him and incurred
by him in any such capacity or arising out of his status as such,
whether or not the corporation would have the power to indemnify
him against such liability under provisions of this Article X."
Item 16. Exhibits.
Exhibit
Number Description of Exhibit
3.1 Articles of Incorporation of Delta Petroleum Corporation
(incorporated by reference to Exhibit 3.1 to the Com-
pany's Form 10 filed September 9, 1987 with the
Securities Exchange Commission. Statement of Designation
and Determination of Preferences of Series A Convertible
Preferred Stock is incorporated by reference to Exhibit
28.3 of the Current Report on Form 8-K dated June 15,
1988. Statement of Designation and Determination of
Preferences of Series B Convertible Preferred Stock is
incorporated by reference to Exhibit 28.1 of the Current
Report on Form 8-K dated August 9, 1989).
3.2 Bylaws of Delta Petroleum Corporation (incorporated by
reference to Exhibit 3.2 to the Company's Form 10 filed
September 9, 1987 with the Securities Exchange
Commission).
5.1 Opinion of Krys Boyle Golz Reich Freedman & Scott,
P.C. regarding legality.*
23.1 Consent of KPMG Peat Marwick LLP, Certified Public
Accountants.**
23.2 Consent of Krys Boyle Golz Reich Freedman & Scott,
P.C. (contained in Exhibit 5.1).*
23.3 Consent of Kent Lina, Petroleum Engineer.*
23.4 Consent of Mannon and Associates, Petroleum Engineers.*
24.1 Power of Attorney (contained in the Signature section of
this Registration Statement).*
* Previously filed.
** Filed herewith.
Item 17. Undertakings.
The undersigned Company hereby undertakes:
(1) to file, during any period in which offers or sales are
being made, a post-effective amendment to the 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;
(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.
(2) That for purposes of determining any liability under the
Securities Act of 1933, 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.
(4) 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 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 the time shall be deemed to be the
initial bona fide offering.
(5) Insofar as indemnification for liabilities arising under
the Securities Act of 1933 may be permitted to directors, officers
and controlling persons of the Company pursuant to the foregoing
provisions, or otherwise, the Company has been advised that in the
opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by
the Company of expenses incurred or paid by a director, officer or
controlling person of the Company 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 Company 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.
SIGNATURES
In accordance with the requirements of the Securities Act of
1933, the Company 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 Denver and State of Colorado on the 30th day of October,
1995.
DELTA PETROLEUM CORPORATION
By /s/Aleron H. Larson, Jr.
Aleron H. Larson, Secretary,
Chairman of the Board, Treasurer,
and Principal Financial Officer
In accordance with the requirements of the Securities Act of
1933, this Registration Statement has been signed below by the
following persons in the capacities and on the date indicated.
Signatures Title Date
/s/Aleron H. Larson, Jr. Principal Financial 10/11/95
Aleron H. Larson, Jr. Officer, Chairman
of the Board, Treasurer,
Secretary and Director
/s/Roger A. Parker President and 10/11/95
Roger A. Parker* Director
/s/Kevin K. Nanke Controller and 10/11/95
Kevin K. Nanke* Principal Accounting
Officer
/s/Terry D. Enright Director 10/11/95
Terry D. Enright*
/s/Don E. Mettler Director 10/11/95
Don E. Mettler*
* The signator, Director of Delta Petroleum Corporation (the
"Company"), further does hereby constitute and appoint Aleron H.
Larson, my true and lawful attorney and agent, with power of
substitution, to sign a Registration Statement under the Securities
Act of 1933 to be filed with the Securities and Exchange
Commission, and to do any and all acts and things and to execute
any and all instruments for me in my name and in the capacity
indicated below, which said attorney and agent, may deem necessary
or advisable to enable the Company to comply with the Securities
Act of 1933, as amended, and any rules, regulations and
requirements of the Securities and Exchange Commission, in
connection with such Registration Statement, including
specifically, but without limitation, power and authority to sign
for me in my name and in the capacity indicated above, any and all
amendments (including post-effective amendments) thereto; and I do
hereby ratify and confirm all that said attorney and agent, or his
substitute or substitutes, or any of them, shall do or cause to be
done by virtue of this Power of Attorney.
EXHIBIT 23.1
Consent of Independent Auditors
The Board of Directors
Delta Petroleum Corporation:
We consent to the incorporation by reference in the registration
statement Form S-3 of Delta Petroleum Corporation of our report
dated October 10, 1995 relating to the consolidated balance sheets
of Delta Petroleum Corporation and subsidiaries as of June 30, 1995
and 1994, and the related consolidated statements of operations,
stockholders' equity, and cash flows for the year ended June 30,
1995, the six months ended June 30, 1994 and the year ended
December 31, 1993, which report appears in the June 30, 1995 Annual
Report on Form 10-KSB of Delta Petroleum Corporation.
Our report contains an explanatory paragraph that states that a
portion of the shares of Amber Resources Company, a majority owned
consolidated subsidiary of the Company, are pledged to secure a
note payable by the Company's former parent, which note is
currently in default. Significant uncertainty exists as to the
former parent s ability to repay or otherwise satisfy the
obligation. The ultimate outcome of this matter cannot presently
be determined. Accordingly, the consolidated financial statements
do not include any adjustments that would result if the holder of
the note were to foreclose on the Amber shares held as collateral
and the Company were otherwise unable to satisfy the obligation and
retain the shares.
Our report also contains an explanatory paragraph that states that
the Company has an investment in certain undeveloped offshore
California properties of $6,786,580 at June 30, 1995. The
Company's ability to ultimately develop the properties is subject
to a number of significant uncertainties, including the operator's
ability to obtain the necessary permits and authorizations relating
to the development activities. Accordingly, the Company's ability
to realize its investment in the offshore California properties is
uncertain and is ultimately dependent on its ability to develop the
properties and/or to sell some or all of its interests in the
properties. Accordingly, the consolidated financial statements do
not include any adjustments that would result if the Company could
not realize its investment in the properties.
Our report also refers to the Company's adoption of Statement of
Financial Accounting Standards No. 121 "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to be
Disposed of" and Statement of Financial Accounting Standards No.
115 "Accounting for Certain Investments in Debt and Equity
Securities" in the year ended June 30, 1995.
KPMG Peat Marwick LLP
Denver, Colorado
October 25, 1995
