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As filed with the Securities and Exchange Commission, November 1, 2000
Securities Act File No. 333-_______; Exchange Act File No. 0-20760
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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GREKA ENERGY CORPORATION
(Exact name of registrant as specified in its charter)
Colorado 84-1091986
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
630 Fifth Avenue, Suite 1501
New York, New York 10111
(212) 218-4680
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
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Randeep S. Grewal
Greka Energy Corporation
630 Fifth Avenue, Suite 1501
New York, New York 10111
(212) 218-4680
(Name, address, including zip code, and telephone number, including
area code, of agent for service)
--------------------
Copies of Communications to:
Roger V. Davidson, Esq.
Ballard Spahr Andrews & Ingersoll, LLP
1225 17th Street, Suite 2300
Denver, Colorado 80202
(303) 292-2400
Approximate date of commencement of proposed sale to public:
As soon as practicable after the registration statement becomes effective
--------------------------
If the only securities being registered on this Form are being offered
pursuant to dividend or interest investment 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. [ ]
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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(c) 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. [ ]________
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box.[x]
CALCULATION OF REGISTRATION FEE
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==========================================================================================================================
Title of Each Class of Securities to Amount to Proposed Maximum Proposed Maximum Amount of
be Registered be Offering Price Per Aggregate Offering Price Registration Fee
Registered Share
(1)
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<S> <C> <C> <C> <C>
Shares offered by selling security 21,861 $ 14.1565(2) $ 309,475(2) $ 81.70
holder
Common Stock, no par value to be 388,236 (3) $8.50 $3,300,006 $ 871.20
issued in conversion of 9%
convertible debentures
Common Stock, no par value to be 50,000 $20.00 $1,000,000 $ 264.00
issued in conversion of 15%
convertible debentures
Common Stock, no par value issuable 127,750 $15.00 $1,916,250 $ 505.89
upon exercise of warrants
Common Stock, no par value issuable 100,000 $10.00 $1,000,000 $ 264.00
upon exercise of Class B warrants
Total $7,525,731 $1,986.79
==========================================================================================================================
</TABLE>
(1) This registration statement covers an additional indeterminate number
of shares of our common stock which may be issued in accordance with
Rule 416.
(2) The proposed maximum offering price is estimated solely for the purpose
of determining the registration fee and calculated pursuant to Rule
457(c). The average of the high and low prices of our common stock
reported by the Nasdaq National Market on October 31, 2000 were used
for the estimate.
(3) Estimated based on minimum conversion price.
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
Statement 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.
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The information in this prospectus is not complete and may be changed.
We can't nor may our selling security holder sell these securities until the
registration statement filed with the SEC 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.
SUBJECT TO COMPLETION, DATED NOVEMBER 1, 2000
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PROSPECTUS
GREKA ENERGY CORPORATION
APPROXIMATELY 438,236 SHARES OF COMMON STOCK IN EXCHANGE FOR
OUTSTANDING CONVERTIBLE GREKA DEBENTURES
AND
227,750 SHARES OF COMMON STOCK ISSUABLE UPON THE EXERCISE OF WARRANTS
AND
21,861 SHARES OFFERED BY SELLING SECURITY HOLDERS
We are offering approximately 388,236 shares in exchange for the
conversion of our 9% Convertible Debentures, 50,000 shares in exchange for the
conversion of our 15% Convertible Debentures and 227,750 shares issuable upon
the exercise of outstanding warrants. Additionally, 21,861 shares are being
offered on behalf of certain selling security holders.
Our common stock is quoted on the Nasdaq National Market under the
symbol "GRKA." The last reported sale price of our common stock on October 25,
2000 was $14.75 per share.
We are an independent integrated energy company focused on exploiting
E&P opportunities and penetrating new niche markets utilizing proprietary
technology with emphasis on short radius horizontal drilling technology patented
by BP Amoco. In addition to owning and operation an asphalt refinery in
California, we have oil and gas production, exploration and development
activities in North America and the Far East, with primary areas of activity in
California, Louisiana and China.
There are certain risks involved with the ownership of our common
stock, including risks related to our business and the markets for our common
stock. (See "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 determined if this
prospectus is accurate or complete. Any representation to the contrary is a
criminal offense.
The date of this prospectus is __________ ,2000
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TABLE OF CONTENTS
<TABLE>
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PAGE
<S> <C>
ABOUT THIS PROSPECTUS.........................................................................2
INFORMATION MADE AVAILABLE TO YOU.............................................................2
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE...............................................3
PROSPECTUS SUMMARY............................................................................3
RISK FACTORS..................................................................................5
USE OF PROCEEDS..............................................................................11
SELLING SECURITY HOLDERS.....................................................................11
PLAN OF DISTRIBUTION.........................................................................12
DESCRIPTION OF CAPITAL STOCK AND OTHER SECURITIES............................................14
LEGAL MATTERS................................................................................17
EXPERTS......................................................................................17
SECURITIES AND EXCHANGE COMMISSION POSITION ON CERTAIN INDEMNIFICATION.......................17
</TABLE>
ABOUT THIS PROSPECTUS
You should only rely on the information contained in this prospectus.
We have not authorized anyone to provide you with information different from
that contained in these documents and the documents incorporated by reference
herein. We are offering to sell, and seeking offers to buy, shares of common
stock only in jurisdictions where offers and sales are permitted.
INFORMATION MADE AVAILABLE TO YOU
This prospectus is part of a Registration Statement on Form S-3 that we
filed with the Securities and Exchange Commission. Certain information in the
Registration Statement has been omitted from this prospectus in accordance with
the rules of the SEC.
We file annual reports, quarterly reports and current reports, proxy
statements and other information with the SEC. Our file number is 0-20760.
You may read and copy materials that we have filed with the SEC,
including the registration statement, at the following SEC public reference
rooms:
450 Fifth Street, N.W. Northwest Atrium Center 7 World Trade Center
Room 1024 500 West Madison Street Suite 1300
Washington, D.C. 20549 Suite 1400 New York, New York 10048
Chicago, Illinois 60661
You can call the SEC at 1-800-732-0330 for further information about
the public reference room.
We are required to file electronic versions of these documents with the SEC.
Those documents may be accessed through the SEC's Internet
site at http://www.sec.gov.
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INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents are deemed to be incorporated by reference in
this registration statement and to be a part of this prospectus.
1. Our annual report on Form 10-K and all amendments thereto for the
year ended December 31, 1999.
2. Our quarterly reports on Form 10-Q for the quarters ended March 31,
2000 and June 30, 2000.
3. Our current reports on Form 8-K and all amendments thereto reporting
events dated each of February 18, 2000, July 7, 2000 and September 7, 2000.
4. Our proxy statement for our annual meeting of shareholders held
December 22, 1999.
5. The description of our no par value common stock which is contained
in our amendment to the registration statement on Form 8-A filed with the SEC on
September 12, 1997.
All documents subsequently filed by us with the SEC pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934 prior
to the termination of the offering shall be deemed to be incorporated by
reference into this prospectus.
We will provide, without charge, to each person to whom a copy of this
prospectus is delivered, on the written or oral request of such person, a copy
of any or all of the documents incorporated into this prospectus by reference.
Written or telephone requests for such copies should be directed to our office:
Greka Energy Corporation, 630 Fifth Avenue, Suite 1501, New York, New York
10111, (212) 218-4680.
PROSPECTUS SUMMARY
This is only a summary and does not contain all the information that
may be important to you. You should read the more detailed information contained
in and incorporated by reference into this prospectus, including but not limited
to, the risk factors beginning on page 5. "We" as used in this prospectus
includes our subsidiaries unless the context requires otherwise.
ABOUT US
We are an independent, integrated energy company committed to creating
shareholder value by capitalizing on consistent cash flow hedged from oil price
fluctuation within integrated operations, exploiting exploration and production
opportunities and penetrating new niche markets utilizing proprietary technology
with emphasis on short radius horizontal drilling technology patented by BP
Amoco and licensed to us. We have oil and gas production and development
activities in North America and the Far East, with primary areas of activity in
California, Louisiana, and China.
Our principal business office is located at 630 Fifth Avenue, Suite 1501, New
York, New York 10111. The telephone number at that address is (212) 218-4680.
FORWARD-LOOKING STATEMENTS
This prospectus and the documents incorporated by reference into this
prospectus contain forward-looking statements that concern our business within
the meaning of Sec. 27A of the Securities Act of 1933 and Sec. 21E of the
Securities and Exchange Act of 1934. All statements, other than statements of
historical facts, included in or
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incorporated by reference into this prospectus that address activities, events
or developments that we expect, believe or anticipate will or may occur in the
future, including the following matters are forward looking statements:
o the benefits we expect to result from our recent acquisition of Saba
Petroleum Company, including the following:
o synergies in the form of increased revenues,
o decreased expenses and avoided expenses and expenditures
that we expect to realize as a result of the transaction,
and
o the complementary nature of our horizontal drilling
technology and certain oil reserves acquired with the
acquisition of Saba,
o future capital,
o development and exploration expenditures, including the timing and
amount
o drilling of wells,
o reserve estimates,
o future production of oil and gas,
o repayment of debt,
o business strategies, and
o expansion and growth of business operations.
These statements are based on certain assumptions and analyses made by
us in light of our experience and our perception of the following:
o historical trends,
o current conditions,
o expected future developments, and
o other factors we believe are appropriate in the circumstances.
Such statements are subject to a number of assumptions including the following:
o risks and uncertainties, including the risk factors in this
prospectus,
o general economic and business conditions,
o the business opportunities that may be presented to and pursued by
us,
o changes in laws or regulations and other factors, many of which are
beyond our control, and
o availability to obtain project financing on favorable conditions.
Significant factors that could prevent us from achieving our stated goals
include:
o our inability to obtain financing for capital expenditures and
acquisitions,
o declines in the market prices for oil, gas, and asphalt and
o adverse changes in the regulatory environment affecting us.
You are cautioned that any such statements are not guarantees of future
performance and that actual results or developments may differ materially from
those projected in the forward-looking statements.
THE OFFERING
Shares of common stock outstanding prior to this offering 3,561,801
Shares offered for Conversion of Debentures 438,236
Shares offered upon exercise of warrants 227,750
Shares offered by selling security holders 21,861
Nasdaq National Market symbol for our common stock GRKA
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RISK FACTORS
Prior to making an investment decision, you should carefully consider, together
with the other information contained in and incorporated by reference into this
prospectus, the following risk factors.
WE CANNOT ENSURE CONTINUED PROFITABILITY IN THE FUTURE.
While we were profitable during 1999 and have continued profitability through
the first half of 2000, we incurred losses for the years ended December 31, 1998
and 1997. We may experience fluctuations in future operating results due to a
variety of factors including the following:
o general economic conditions,
o specific economic conditions in the asphalt and oil and gas industry,
and
o capital and other costs relating to the expansion of operations.
Many of those factors are out of our control. There can be no assurance that our
operations will continue to be profitable.
WE HAVE SUBSTANTIAL CAPITAL REQUIREMENTS.
We make, and will continue to make, substantial capital expenditures for the
exploitation, production and acquisition of oil and gas reserves. We have
financed these expenditures primarily from borrowings from banks and private
placements of our common stock. If revenues or our ability to borrow decreases
as a result of lower oil and gas prices, operating difficulties or declines in
reserves, we may have limited ability to fund the capital requirements to
undertake or complete future exploitation, production and acquisition programs.
We cannot assure you that additional debt or equity financing or cash generated
by operations will be available to meet these requirements.
WE MAY INADVERTENTLY ACQUIRE PROPERTIES WITH ENVIRONMENTAL PROBLEMS OR
STRUCTURAL CONTAMINATION.
We intend to acquire additional oil and gas properties. Although we perform a
review of the acquired properties that we believe is consistent with industry
practices, such reviews are inherently incomplete. It generally is not feasible
to review in depth every individual property involved in each acquisition.
Ordinarily, we will focus our due diligence efforts on the higher valued
properties and will sample the remainder. However, even an in-depth review of
all properties and records may not necessarily reveal existing or potential
problems nor will it permit us to become sufficiently familiar with the
properties to assess fully their deficiencies and capabilities. We may not
inspect every well. Additionally, structural or environmental problems, such as
ground water contamination, are not necessarily observable even when we
undertake an inspection. We may be required to assume preclosing liabilities,
including environmental liabilities, and may acquire interests in properties on
an "as is" basis. We cannot assure you that our acquisitions will be successful.
WE COMPETE WITH COMPANIES WITH GREATER MARKET SHARE AND RESOURCES.
We compete with other companies which have substantially greater market share,
greater financial and other resources, better name recognition and longer
operating histories. We may therefore not be able to acquire desirable oil and
gas properties to develop.
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WE HAVE ENVIRONMENTAL RISKS ASSOCIATED WITH ONE OF OUR MINERAL PROPERTIES IN
CALIFORNIA.
In 1993, our predecessor acquired a producing mineral interest in
California from a major oil company. At the time of acquisition, our
predecessor's investigation revealed that a discharge of diluent, a light,
oil-based fluid which is often mixed with heavier grades of crude had occurred
on the acquired property. The purchase agreement required the seller to
remediate the area of the diluent spill. After we assumed operation of the
property, we became aware of additional diluent contamination and believe the
major oil company is responsible to remediate those areas as well. We have
notified the seller of its obligation to remediate. Notwithstanding our
compliance in proceeding with any required remediation on seller's account, we
are committed to hold the seller accountable for the required remediation. Since
the investigation is ongoing, we are unable to accurately estimate the cost.
WE HAVE ENVIRONMENTAL RISKS ASSOCIATED WITH ONE OF OUR OIL AND GAS PROPERTIES IN
CALIFORNIA.
In 1995, our predecessor agreed to acquire an oil and gas interest in
California on which a number of out of production oil wells had been drilled by
the seller. The acquisition agreement required that our predecessor assume the
obligation to abandon any wells that it did not return to production,
irrespective of whether certain consents of third parties necessary to transfer
the property to us were obtained. A third party whose consent was required to
transfer the property did not consent to the transfer and is holding the seller
responsible for all remediation. We believe we have no financial obligation to
remediate this property because we believe the seller did not give our
predecessor any consideration to enter into the contract for the property. Since
May 2000, we commenced remediation on the subject property as directed by the
regulatory agency. Notwithstanding our compliance in proceeding with any
required remediation on seller's account, we are committed to hold the seller
accountable for the required obligations of the property. Since the
investigation is not complete we cannot make an accurate estimation of the final
cost.
WE HAVE ENVIRONMENTAL RISKS ASSOCIATED WITH OUR ASPHALT REFINERY.
We own an asphalt refinery in Santa Maria, California, with which
environmental remediation obligations are associated. The party who sold the
asphalt refinery to us is performing all environmental obligations that arose
during and as a result of its operations of the refinery prior to the
acquisition. There could be additional environmental issues which may require
material remediation efforts in the future.
WE COULD INCUR COSTS TO COMPLY WITH ENVIRONMENTAL LAWS AND REGULATIONS.
Most of the properties that have been purchased by us have been in
production for a number of years and should be expected to have environmental
problems typical of oil field operations generally, and may contain other areas
of greater environmental concern. We have identified a number of areas in which
contamination exists on properties acquired by us.
We have agreed to indemnify some sellers from various environmental
liabilities, including those that are associated with the seller's prior
obligations. Many of these properties were in production during years in which
environmental controls were significantly more lax than they are presently. At
the time of an acquisition, there may be unknown conditions which subsequently
may give rise to an environmental liability. Consequently, it is difficult to
assess the extent of our obligation under these indemnities.
OUR FOREIGN OPERATIONS HAVE CURRENCY EXCHANGE AND ASSET REPATRIATION RISKS.
We are undertaking exploration and exploitation operations in Indonesia
and China. Risks inherent in international operations generally include the
following:
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o local currency instability,
o inflation,
o the risk of realizing economic currency exchange losses when
transactions are completed in currencies other than United States
dollars, and
o the ability to repatriate earnings under existing exchange control
laws.
Changes in domestic and foreign import and export laws and tariffs can
also materially impact international operations. In addition, foreign operations
involve political, as well as economic, risks such as:
o nationalization,
o expropriation,
o contract renegotiation, and
o changes in laws resulting from governmental changes.
In addition, many licenses and agreements with foreign governments are
for a fixed term and may not be held by production. In the event of a dispute,
we may be subject to the exclusive jurisdiction of foreign courts or may not be
successful in subjecting foreign persons to the jurisdiction of courts in the
United States. We may also be hindered or prevented from enforcing our rights
with respect to a governmental instrumentality because of the doctrine of
sovereign immunity.
OUR ASPHALT HEDGING STRATEGY DOES NOT ELIMINATE FLUCTUATIONS TO OUR QUARTERLY
RESULTS DUE TO VOLATILITY OF OIL AND GAS PRICES AND MARKETS.
Our revenues, cash flow, profitability and future rate of growth are
dependent upon prevailing prices for oil, gas and asphalt. Our ability to
maintain or increase our borrowing capacity and to obtain additional capital on
attractive terms is also to some extent dependent on these commodities prices.
Historically, oil and gas prices and markets have been volatile and are likely
to continue to be volatile in the future. Prices for oil and gas are subject to
wide fluctuations in response to relatively minor changes in supply of and
demand for oil and gas, market uncertainty and a variety of additional factors
that are beyond our control. Those factors include:
o international political conditions,
o the domestic and foreign supply of oil and gas,
o the level of consumer demand, weather conditions,
o domestic and foreign governmental regulations,
o the price and availability of alternative fuels, and
o overall economic conditions.
Significant declines in the price of oil or gas, such as the declines
in oil prices during 1998, would adversely affect our revenues, operating income
and borrowing capacity and may require a reduction in the carrying value of our
oil and gas properties.
REPLACEMENT OF OUR OIL AND GAS RESERVES IS UNCERTAIN.
Our future success depends upon our ability to find, develop or acquire
additional oil and gas reserves that are economically recoverable. Except to the
extent that we conduct successful exploitation and production activities or
acquire properties containing proved reserves, our estimated net proved reserves
will generally decline as reserves are produced. We cannot assure you that our
planned exploitation and production projects and acquisition activities will
result in significant additional reserves or that we will have continuing
success drilling productive wells economically. If prevailing oil and gas prices
were to increase significantly, our costs to add new reserves could increase.
The drilling of oil and gas wells involves a high degree of risk,
especially the risk of dry holes or of wells that are not sufficiently
productive to provide an economic return on the capital expended to drill the
wells. In addition, our drilling operations, including our contract services,
may be curtailed, delayed or canceled as a result of numerous factors, including
the following:
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o title problems,
o weather conditions,
o compliance with governmental requirements, and
o shortages or delays in the delivery of equipment.
OUR ATTEMPTS TO ENFORCE OUR RIGHT TO REACQUIRE THE COLOMBIAN ASSETS FROM OMIMEX
MAY BE UNSUCCESSFUL.
As reported in our 10-K filed for the year ended December 31, 1999,
which is incorporated herein by reference, during March of this year we
exercised our option to repurchase the Colombian assets from Omimex for an
estimated cost of $12,000,000. Our attempt to rescind the agreement or close our
option resulted in a law suit being filed to enforce those rights, which lawsuit
is presently pending. While we have projected a substantial value for the
Colombian assets, there can be no guaranty that we will be successful in our
efforts to force the transfer of the Colombian assets to us, nor that the
out-of-pocket expense and manpower costs of the litigation will not also have a
negative impact on the results of our other core operations.
OUR ESTIMATES OF OIL AND GAS RESERVES AND FUTURE NET REVENUES ARE UNCERTAIN.
The documents incorporated by reference into this prospectus include
estimates of net proved oil and gas reserves and the future net revenues from
those reserves which have been prepared by us and our independent petroleum
engineers. There are numerous uncertainties inherent in estimating quantities of
proved oil and gas reserves, including many factors beyond our control. Reserve
engineering is a subjective process of estimating the underground accumulations
of oil and gas that cannot be measured in an exact manner. The estimates
incorporated by reference into this prospectus are based on various assumptions
required by the SEC including the following:
o constant oil and gas prices,
o operating expenses, and
o capital expenditures.
Those estimates therefore, are inherently imprecise indications of future net
revenues. The following actual amounts may vary substantially from the estimated
amounts:
o amount of production,
o revenues,
o taxes,
o development expenditures,
o operating expenses, and
o quantities of recoverable oil and gas reserves to be encountered.
Any significant variance in the assumptions used for the estimates of
reserves could materially affect the estimated quantity and value of reserves
incorporated by reference into this prospectus. In addition, our reserves may be
subject to downward or upward revision based upon the following:
o production history,
o results of future development,
o availability of funds to acquire additional reserves,
o prevailing oil and gas prices, and
o other factors.
In addition, the calculation of the estimated present value of the
future net revenue using a 10% discount rate as required by the SEC is not
necessarily the most appropriate discount factor based on interest rates in
effect from time to time and risks associated with our reserves or the oil and
gas industry in general.
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It is also possible that independent petroleum engineers may make
estimates of reserves and future net revenues from the same available data that
are different than our estimates or the estimates of different independent
petroleum engineers. Should this occur, management would adopt the estimates of
its independent engineers.
In calculating reserves on a barrels of oil equivalent basis, gas was
converted to oil at a certain ratio. While this convention approximates the
energy equivalent of oil and gas on a British thermal unit basis, it may not
represent the relative prices received by us on the sale of our oil and gas
production.
The estimated future net revenues attributable to net proved reserves
are prepared in accordance with SEC guidelines, and are not intended to reflect
the fair market value of reserves. In accordance with the rules of the SEC,
reserve estimates are prepared using period end prices received for oil and gas.
Reductions in prices below those prevailing at December 31, 1999 would result in
the estimated quantities and present values of reserves being reduced.
WE FACE UNINSURED RISKS.
Our oil and gas business involves a variety of operating risks,
including the following:
o fire
o explosions
o blow-outs
o pipe failure
o casing collapse
o abnormally pressured formations, and
o environmental hazards such as
o oil spills,
o gas leaks,
o ruptures, and
o discharges of toxic gases.
The occurrence of any of those events could result in the following:
o substantial losses due to injury and loss of life,
o severe damage to and destruction of property, natural resources
and equipment,
o pollution and other environmental damage,
o clean-up responsibilities, and
o regulatory investigation and penalties and suspension of
operations
We maintain general liability insurance coverage for our operations but
have not obtained insurance coverage for certain environmental hazards. The
occurrence of a significant unfavorable event not fully covered by insurance
will have a material adverse effect on our financial condition and results of
operations. Furthermore, we cannot predict whether insurance will continue to be
available at a reasonable cost or at all.
WE FACE SUBSTANTIAL GOVERNMENTAL REGULATION AND ENVIRONMENTAL RISKS.
Our business is subject to various laws and regulations which may be
changed from time to time in response to economic or political conditions.
Matters subject to regulation include the following:
o discharge permits for drilling operations,
o drilling bonds,
o reports concerning operations,
o the spacing of wells,
o unitization and pooling of properties,
o taxation, and
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o environmental protection.
From time to time, regulatory agencies have imposed price controls and
limitations on production by restricting the rate of flow of oil and gas wells
below actual production capacity in order to conserve supplies of oil and gas.
WE CAN ISSUE SIGNIFICANT AMOUNTS OF STOCK WITHOUT SHAREHOLDER APPROVAL.
The Nasdaq National Market listing requirements provide that we may
issue, without shareholder approval, securities representing the present or
potential issuance of up to 20% of the number of shares of common stock
outstanding prior to the issuance of such securities. We have previously
received shareholder approval for the issuance of up to 2,000,000 shares of our
common stock for use in capital-raising activities and acquisitions. Finally, on
November 3, 1999, we adopted a rights plan with our transfer agent authorizing
the issuance of rights to acquire additional shares of our stock to shareholders
of record at the discretion of the Board of Directors in an effort to discourage
any potential attempted hostile takeovers. Any such issuances could be used as a
method of discouraging, delaying or preventing a change in control of us and
would significantly dilute our public ownership, which could adversely affect
the market value of our common stock. There can be no assurance that we will not
undertake to issue such shares if we deem it appropriate to do so.
WE HAVE NOT PREVIOUSLY PAID DIVIDENDS ON OUR COMMON STOCK.
We have not previously paid any cash or other dividends on our common
stock. We anticipate that any earnings would be retained by us to finance our
operations and future growth and expansion.
THE PRICE OF OUR COMMON STOCK COULD BE VOLATILE.
The trading prices of our common stock could be subject to wide
fluctuations in response to the following:
o quarterly variations in actual or anticipated results of our
operations,
o changes in securities analysts' earnings estimates,
o announcements of technological innovations by us or our
competitors,
o general conditions in the oil and gas industry, or
o other factors.
Further, the trading volume of our stock currently is relatively small,
and the market for our stock may not be able to efficiently accommodate
significant trades on any given day. Consequently, sizable trades of our common
stock have in the past, and may in the future, cause volatility in the market
price of our common stock to a greater extent than in more actively traded
securities. These broad fluctuations may adversely affect the market price of
our common stock.
OUR ARTICLES OF INCORPORATION ELIMINATE OUR DIRECTORS' LIABILITY.
Our Articles of Incorporation contain a provision eliminating our
directors' liability to us or our shareholders for monetary damages for a breach
of their fiduciary duty. However, a director's liability is not eliminated in
circumstances involving certain wrongful acts, such as the breach of a
director's duty of loyalty or acts or omissions which involve intentional
misconduct or a knowing violation of law. Our Articles of Incorporation also
obligate us to indemnify our directors and officers to the fullest extent
permitted under Colorado law. While we believe that these provisions are very
standard and necessary to assist us in attracting and retaining qualified
individuals to serve as directors, they could also serve to insulate our
directors against liability for actions which damage us or our shareholders.
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USE OF PROCEEDS
We will not receive any proceeds from the sale of the shares of common
stock being sold by our selling security holders nor will we receive proceeds
from the conversion of our 9% convertible debenture or our 15% convertible
debenture. Assuming all of the warrants and Class B warrants are exercised the
Company would receive total proceeds of $2,962,060. Net proceeds less
approximately $25,000 of expenses totaling $2,937,060 would be used to retire
short-term debt and for general working capital purposes.
We cannot estimate however how many if any warrants will be exercised
as a result of this offering. Therefore the use of proceeds and an estimate of
the net proceeds available to the Company are only estimates and the actual use
of whatever funds are received by way of the exercise of these warrants may vary
substantially from the information set forth herein.
SELLING SECURITY HOLDERS
The following table shows for the selling security holders, the following
information:
o the number shares of common stock beneficially owned by them as
November 1, 2000,
o the number of shares of common stock covered by this prospectus,
and
o the number of shares of common stock to be retained after this
offering, if any.
<TABLE>
<CAPTION>
Number of Shares of Number of Shares of
Common Stock Number of shares of Common Stock Percent of Class
Beneficially Owned Common Stock to be Beneficially Owned Beneficially Owned
Name Before the Offering Sold After the Offering After the Offering
---- ------------------- ---- ------------------ ------------------
<S> <C> <C> <C> <C>
Joseph Weinberg 7,635 7,635 0 0
Paul and Julie Candau,
Trustees or Their
Successors INTR U/A
CANDAU FAM LIV TR DTD
5/15/95 3,310 3,310 0 0
Arthur N. Lifshutz 2,206 2,206 0 0
Mildred C. Share, TTEE 1,176 1,176 0 0
Norman E. Warner, TR
WEINBERG TRUST U/A DTD
5/11/82 1,823 1,823 0 0
Irving Greenhouse 911 911 0 0
Morton Jack Friedenthal
& Jane C. Friedenthal,
TTEES FOR FRIEDENTHAL
FAM TR 800 800 0 0
Advanced Clearing Corp. 400 400 0 0
DB ALEX BROWN LLC 3,600 3,600 0 0
</TABLE>
11
<PAGE> 14
PLAN OF DISTRIBUTION
9% CONVERTIBLE DEBENTURES
Our 9% convertible debentures are convertible to our common stock at
the option of the holders of the debentures at any time prior to the due date of
the debenture (December 31, 2005), unless previously redeemed. Upon the receipt
of a duly executed notice of election to convert the debenture, we will convert
the debenture to our common stock based upon a per share conversion price equal
to 95% of the average closing bid price of our common stock for 30 consecutive
trading days ending one day prior to the receipt of the notice of election to
convert except that the conversion price shall in no case be less than $8.50 per
share nor greater than $12.50 per share. We also have the right to redeem the 9%
debenture by providing 30 days written notice of our intent to redeem during
which time the debenture holder may convert his or her debenture. At the present
time we have no intention to redeem the 9% debentures. As of the date of this
prospectus, 21,861 shares of our common stock have been issued as a result of
conversions and these shares are being registered for resale as part of this
registration statement.
15% CONVERTIBLE DEBENTURES
On February 26, 1999, we issued $1,000,000 in debentures convertible to
our common stock presently at the rate of one share of common stock for each
$20.00 of principal and accrued interest at any time on or before 5:00 p.m.
Eastern Standard Time on January 31, 2001. We will effect the conversion at the
request of the debenture holder upon receipt of a duly executed Notice of
Election to Convert. We also have the right to call for payment the principal
balance of the debenture outstanding and all accrued interest by providing a 30
day notice to our debenture holders of our intention to pay the debenture. Once
the notice of call is delivered to our debenture holders, the debenture holder
at his or her election may in turn deliver a duly executed Notice of Election to
Convert to us during the notice period and we will in turn convert the debenture
including principal and interest to our common shares at the rate of $20.00 per
share of all outstanding principal and interest. At the present time we have no
intention to call the 15% debentures.
THE WARRANTS
We presently have outstanding two sets of warrants. In October of 1997
in connection with a private offering of our common stock we issued warrants to
purchase a total of 127,750 shares of our common stock at a purchase price of
$15.00 per share. Each warrant entitles the holder to purchase one (1) share of
our common stock for $15.00 per share at any time on or before 5:00 p.m. Eastern
Standard Time on December 1, 2000. We will issue a fully registered share of our
common stock upon the receipt by us of the warrant certificate accompanied by a
duly executed subscription form and the exercise price of $15.00 per share.
In connection with the issuance of our $1,000,000 15% debenture on
February 26, 1999 the company also issued 100,000 warrants which were designated
as Class B warrants exercisable to acquire one share of our common stock for
each warrant at an exercise price of $10.00 per share at any time on or before
December 31, 2001. We will issue a fully registered common share to any Class B
warrant holder exercising his warrants in a timely fashion upon receipt by us of
the warrant certificate accompanied by a duly executed subscription form and the
warrant exercise price in full.
12
<PAGE> 15
FOR SELLING SECURITY HOLDERS
We are also registering 21,861 shares of our common stock covered by
this prospectus for selling security holders.
As used in this prospectus, the selling security holder includes
donees, pledgees, transferees or other successors in interest who will hold the
selling security holders' shares after the date of this prospectus. We are
paying the costs, expenses and fees of registering the common stock, but the
selling security holders will pay any underwriting or brokerage commissions and
similar selling expenses relating to the sale of the shares of common stock.
The selling security holders may sell our common stock at market prices
prevailing at the time of the sale, at prices related to the prevailing market
prices, at negotiated prices or such other price as the selling security holders
determine from time to time. The selling security holders may sell from time to
time some or all of their common stock in one or more transactions (which may
involve block transactions):
o the Nasdaq National Market or on such other market on which the
common stock may from time to time be trading;
o in privately negotiated transactions;
o short sales;
o in ordinary brokers' transactions;
o in transactions involving cross or block trades or otherwise;
o through purchases by brokers, dealers or underwriters as principal
and resale by those purchasers for their own accounts under this
prospectus;
o through market makers or into an existing market for the common
stock;
o in other ways not involving market makers or established trading
markets, including direct sales to purchasers or sales effected
through agents;
o in transactions in involving the writing of options, swaps or
other derivatives; or
o in any combination of the selling options described in this
prospectus, or by any other legally available means.
The selling security holders may enter into hedging transactions with
broker-dealers who may engage in short sales of our common stock in the course
of hedging the positions they assume. The selling security holders also may
enter into option or other transactions with broker-dealers that require the
delivery by those broker-dealers of the common stock. Thereafter, the shares may
be resold under this prospectus.
The selling security holders shall have the sole and absolute
discretion not to accept any purchase offer or make any sale of shares if they
deem the purchase price to be unsatisfactory at any particular time. We cannot
assure you that all or any of the shares offered in this prospectus will be
issued to, or sold by, the selling security holders.
In their selling activities, the selling security holders will be
subject to applicable provisions of the Securities Exchange Act of 1934 and the
Securities Exchange Act's rules and regulations, including Regulation M, which
may limit the activity of the selling security holders and the timing of
purchases and sales of our common stock. Furthermore, under Regulation M,
persons engaged in a distribution of securities are prohibited from
simultaneously engaging in market making and certain other activities with
respect to such securities for a specified period of time prior to the
commencement of such distributions, subject to specified exceptions or
exemptions. The foregoing may affect the marketability of the shares of our
common stock. Any selling security holders who may be "affiliated purchasers" of
ours as defined in Regulation M, have been further advised that they must
coordinate their sales under this prospectus with each other and us for purposes
of Regulation M.
The selling security holders and any broker-dealers involved in the
sale or resale of our common stock may qualify as "underwriters" within the
meaning of Section 2(11) of the Securities Act of 1933. In addition, the
broker-dealers' commissions, discounts or concessions may qualify as
underwriters' compensation under the Securities Act. If any selling security
holders or any broker-dealer qualifies as an "underwriter," then they will be
subject to the
13
<PAGE> 16
prospectus delivery requirements of Section 153 of the Securities Act, which may
include delivery through the facilities of the NASD.
In conjunction with sales to or through brokers, dealers or agents, the
selling security holders may agree to indemnify them against liabilities arising
under the Securities Act. We know of no existing arrangements between the
selling security holders, any other shareholder, broker, dealer, underwriter or
agent relating to the sale or distribution of our common stock.
In addition to selling its common stock under this prospectus, the
selling security holders may:
o Transfer their common stock in other ways not involving market
makers or established trading markets, including by gift,
distribution, or other transfer; or
o Sell their common stock under Rule 144 of the Securities Act, if
the transaction meets the requirements of Rule 144.
We will amend or supplement this prospectus if required under the
Securities Act.
DESCRIPTION OF CAPITAL STOCK AND OTHER SECURITIES
GENERAL
Our Articles of Incorporation authorize us to issue 50,000,000 shares
of no par value common stock, and 50,000,000 shares of no par value Preferred
Stock. The shares of our preferred stock are issuable from time to time in one
or more series and with such designations, powers, preferences and rights, and
qualifications, limitations or restrictions as may be determined by the board,
consistent with the Articles and with the laws of the State of Colorado. At the
present time no shares of preferred stock are issued and outstanding, and no
series of preferred stock has been designated.
COMMON STOCK
We had approximately 3,561,801 shares of common stock outstanding prior
to this offering, which were held by approximately 6,480 shareholders. Each
share of common stock entitles the shareholder to one vote. Holders of common
stock are not entitled to cumulative voting in the election of directors and
have no preemptive or subscription rights except with respect to the Right Plan
discussed below. Subject to the rights of holders of any outstanding shares of
preferred stock, shares of common stock are entitled to share equally in
dividends paid from the funds legally available for the payment thereof, when,
as and if declared by the board. Subject to the rights of holders of any
outstanding shares of preferred stock, holders of common stock are also entitled
to share ratably in our assets available for distribution to holders of common
stock upon our liquidation or dissolution, whether voluntary or involuntary. The
common stock is listed on the Nasdaq National Market under the symbol "GRKA."
Our transfer agent is The Bank of New York, New York, NY.
OPTIONS
As of October 30, 2000, options to purchase an aggregate of 1,400,000
shares of the common stock were issued and outstanding. These options were
issued to several of our employees and directors, and to various consultants.
The exercise price of these options varies from a minimum of $5.00 per share to
a high of $8.625 per share.
WARRANTS
We have outstanding warrants to purchase an aggregate of 227,750 shares
of common stock, as described below.
14
<PAGE> 17
In October 1997, in connection with a private offering of our common
stock, we issued warrants to purchase 127,750 shares as part of a unit of common
stock and warrants. Each warrant entitles the holder to purchase one share of
our common stock for a purchase price of $15.00 per share. While the warrants
were originally intended to expire on December 31, 1999, the board of directors
at a meeting called for that purpose determined to extend the exercise period of
the warrants until 5:00 Eastern Standard Time on December 1, 2000 after which
date they will expire and be of no effect. The warrant may be exercised by
surrendering the warrant along with a duly executed subscription form and the
purchase price for the number of warrants being exercised to our transfer agent
who will in turn tender the purchase price to us and the duly registered common
shares to the exercising holder. The warrants provide for an adjustment of the
exercise price should we issue a common stock dividend or engage in a forward or
a reverse split of our common shares, however, none of these anti-dilution
provision events have occurred through the date of this Prospectus. The warrant
also provides that the Company may call the exercise of the warrant if at any
time prior to the expiration date, the Company's common stock trades on the
Nasdaq National Market System at a price in excess of $45.00 per share. Once
called, the holders of the warrant will have 30 days in which to exercise the
warrant or they will expire.
In connection with the issuance of the $1,000,000 debenture on February
26, 1999, the Company also issued one warrant for each $10.00 of investment in
the debenture or a total of 100,000 warrants. These warrants were designated as
Class B warrants and are exercisable at any time through 5:00 Eastern Standard
Time on December 31, 2001. Each Class B warrant entitles the holder to purchase
one share of common stock for an exercise price of $10.00 per share by
delivering the warrant along with the duly executed warrant subscription
agreement and the exercise price to the Company's transfer agent on or before
the expiration date, December 31, 2001. The Class B warrants have anti-dilution
provisions providing for an adjustment of the purchase price and the number of
shares which the warrants may be converted into should we issue a stock dividend
or otherwise engage in forward or reverse split transactions. The Class B
warrants do not provide for a call provision, therefore, we can not require that
a Class B warrant holder exercise the warrants prior to the expiration date or
provide for an earlier expiration date as a result of a call.
9% CONVERTIBLE DEBENTURES
Our 9% convertible debentures are convertible to our common stock at
the option of the holders of the debentures at any time prior to the due date of
the debenture (December 31, 2005), unless previously redeemed. Upon the receipt
of a duly executed notice of election to convert the debenture, we will convert
the debenture to our common stock based upon a per share conversion price equal
to 95% of the average closing bid price of our common stock for 30 consecutive
trading days ending one day prior to the receipt of the notice of election to
convert except that the conversion price shall in no case be less than $8.50 per
share nor greater than $12.50 per share. We also have the right to redeem the 9%
debenture by providing 30 days written notice of our intent to redeem during
which time the debenture holder may convert his or her debenture. At the present
time we have no intention to redeem the 9% debentures. As of the date of this
prospectus, 21,861 shares of our common stock have been issued as a result of
conversions and these shares are being registered for resale as part of this
registration statement.
Our debentures provide registration rights relative to the common
shares underlying the conversion rights which are being met pursuant to the
registration statement, of which this Prospect forms a part. Greka is obligated
within ninety days of issuance of the debenture to file a registration statement
registering the common shares underlying the conversion privileges or the resale
of the common shares issued pursuant to a conversion notice received prior to
the date a registration statement is declared effective by the Securities and
Exchange Commission.
15% CONVERTIBLE DEBENTURES
On February 26, 1999, we issued $1,000,000 in debentures convertible to
our common stock presently at the rate of one share of common stock for each
$20.00 of principal and accrued interest at any time on or before 5:00 p.m.
Eastern Standard Time on January 31, 2001. We will effect the conversion at the
request of the debenture holder upon receipt of a duly executed Notice of
Election to Convert. We also have the right to call for payment the principal
balance of the debenture outstanding and all accrued interest by providing a 30
day notice to our debenture holders of our intention to pay the debenture. Once
the notice of call is delivered to our debenture holders, the
15
<PAGE> 18
debenture holder at his or her election may in turn deliver a duly executed
Notice of Election to Convert to us during the notice period and we will in turn
convert the debenture including principal and interest to our common shares at
the rate of $20.00 per share of all outstanding principal and interest. We have
no present intent to call the 15% debentures.
CERTAIN VOTING REQUIREMENTS
Our Articles of Incorporation provide that except as required by law,
matters initiated by the Board of Directors shall require for approval that
votes cast in favor of the matter within each voting group exceed the votes cast
against the matter at a meeting at which a quorum is present. A quorum is
defined as shares representing at least one-third of the shares of each voting
group entitled to vote at such a meeting be represented in person or by proxy.
Except as otherwise provided by law, matters not initiated by the Board of
Directors shall require for approval the affirmative vote of two-thirds of all
votes entitled to be cast within each voting group, except that a shareholder
initiative to remove a Director shall require only a simple majority vote of
those shareholders present in person or by proxy assuming a quorum.
Additionally, our Board of Directors is elected in three groups with
staggered terms, with each term lasting for three years. This provision, in
addition to the shareholder rights plan discussed below, is intended to make
more difficult attempts of unfriendly takeover of our company.
SHAREHOLDER RIGHTS PLAN
In November 1999, the board of directors adopted a shareholder rights
plan and declared a dividend distribution of one common share purchase right for
each outstanding share of our common stock. Each right entitles the holder to
purchase from us one share of common stock at an initial purchase price of
$60.00 per share, subject to adjustment. The following summary of the
shareholder rights plan is derived from the complete description and terms of
the rights which are contained in the related rights agreement between us and
The Bank of New York, which is the current rights agent.
The rights currently are evidenced by and trade with the certificates
for the outstanding shares of common stock. The rights will separate from the
common stock and be separately distributed upon the earlier of:
o the tenth day after a person or group acquires beneficial
ownership of 33% or more of our outstanding shares of common
stock, or
o the tenth business day, or a later date as may be determined by a
majority of the board of directors, after a person or group
announces a tender or exchange offer that if completed would
result in the person or group beneficially owning 33% or more of
our outstanding shares of common stock.
After any separating distribution of the rights, separate rights certificates
will be mailed to holders of common stock as of the date of distribution and the
rights will become transferable apart from the common stock.
The rights are not exercisable until they separate from the common
stock and will expire upon the earlier of November 3, 2004 or the redemption of
the rights by us as described below.
If a person or group acquires beneficial ownership of 33% or more of
the outstanding shares of common stock, then each right other than rights owned
by the acquirer will entitle the holder to purchase one share of our common
stock at an adjusted purchase price of 50% of the market value of the common
stock at that time.
If after a person or group acquires beneficial ownership of 33% or more
of the outstanding shares of our common stock:
o we merge into another entity,
16
<PAGE> 19
o an acquiring entity merges into us, or
o we sell more than 50% of our assets or earning power,
then each right other than rights owned by the acquirer will entitle the holder
to purchase a number of shares of common stock of the acquiring entity having a
market value at that time of twice the purchase price under the right.
The purchase price payable and the number of shares of common stock or
other securities issuable upon exercise of the rights are subject to customary
adjustments from time to time to prevent dilution.
The rights are redeemable at the option of the board of directors for
$0.01 per right at any time until after the tenth day, or a later date as may be
determined by a majority of the board of directors, after public announcement
that a person or group has acquired beneficial ownership of 33% or more of our
common stock.
Until a right is exercised, the holder of a right as such will not for
any purpose be deemed a shareholder of the shares of common stock which may be
purchased upon exercise of the right.
The terms of the rights and the rights agreement may be amended in any
respect without the consent of the rights holders on or before any separate
distribution of the rights certificates. After that date the terms of the rights
and the rights agreement may be amended without the consent of the rights
holders to cure any ambiguities or to make changes which do not adversely affect
the interests of the rights holders other than an acquirer.
LEGAL MATTERS
Ballard Spahr Andrews & Ingersoll, LLP, will pass upon the validity of
common stock offered by this prospectus.
EXPERTS
The financial statements and schedules as of and for the years ending
December 31, 1999 and 1998, 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 dated April
14, 2000 with respect thereto, and are included herein in reliance upon the
authority of said firm as experts in giving said reports.
The financial statements of Greka Energy Corporation incorporated by
reference in this prospectus to the extent and for the periods indicated in
their reports, have been audited by Bateman & Co., Inc., P.C., independent
public accountants, and are included herein in reliance upon the authority of
said firms as experts in giving said reports.
The information incorporated by reference into this prospectus
regarding our total proved reserves of oil and gas was based on reports prepared
by the following independent engineers: Netherland, Sewell & Associates, Inc.
Our reserve estimates are incorporated by reference into this prospectus in
reliance upon the authority of said persons as experts with respect to the
matters covered by their reports and the giving of their reports. to us.
SECURITIES AND EXCHANGE COMMISSION POSITION ON CERTAIN
INDEMNIFICATION
The Colorado Business Corporation Act provides for indemnification by a
corporation of costs incurred by directors, employees, and agents in connection
with an action suit, or proceeding brought by reason of their position as a
director, employee, or agent. The person being indemnified must have acted in
good faith and in a manner he reasonably believed to be in or not opposed to the
best interests of the corporation.
17
<PAGE> 20
Our Articles of Incorporation obligate us to indemnify our directors
and officers to the fullest extent permitted under Colorado law.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers or persons controlling us pursuant
to the foregoing provisions, we have been informed that, in the opinion of the
Securities and Exchange Commission, such indemnification is against public
policy as expressed in the Securities Act and is therefore unenforceable.
18
<PAGE> 21
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
-------------------------------------------
The estimated expenses of the offering, all of which are to be borne by
the Registrant, are as follows:
<TABLE>
<S> <C>
Total Registration Fee Under Securities Act of 1933 $ 1,987
Printing and Engraving 5,000*
Accounting Fees and Expenses 5,000*
Legal Fees and Expenses 10,000*
Blue Sky Fees and Expenses (including related legal fees) 2,000*
Transfer Agent Fees 1,000*
Miscellaneous 112*
Total $25,099*
=======
</TABLE>
*Estimated
Item 15. Indemnification of Directors and Officers
-----------------------------------------
The Registrant's Articles of Incorporation eliminate the personal
liability of directors to the Registrant or its shareholders for monetary
damages for breach of fiduciary duty to the extent permitted by Colorado law.
The Registrant's Articles of Incorporation and By-Laws provide that the
Registrant shall indemnify its officers and directors to the extent permitted by
Colorado law, which authorizes a corporation to indemnify directors, officers,
employees or agents of the corporation in non-derivative suits if such party
acted in good faith and in a manner such party reasonably believed to be in or
not opposed to the best interest of the corporation and, with respect to any
criminal action or proceeding, had no reasonable cause to believe his or her
conduct was unlawful. The Colorado Business Corporation Act further provides
that indemnification shall be provided if the party in question is successful on
the merits or otherwise.
Item 16. Exhibits
--------
The following Exhibits are filed as part of this Form S-3 Registration
Statement pursuant to Item 601 of Regulation S-K or incorporated by reference to
other filings:
<TABLE>
<CAPTION>
Exhibit
Number Description
------- -----------
<S> <C>
4.1 Form of 9% Subordinated Debenture with Conversion Privileges Agreement. **
4.2 Form of 15% Subordinated Debenture with Conversion Privileges Agreement.**
4.3 Form of Warrant Agreement**
4.4 Form of Class B Warrants**
5.1 Opinion of Ballard Spahr Andrews & Ingersoll, LLP concerning the legality of the common stock
offered hereby.***
23.1 Consent of Ballard Spahr Andrews & Ingersoll, LLP (included in Exhibit 5.1 to this registration
statement).*
</TABLE>
19
<PAGE> 22
<TABLE>
<CAPTION>
Exhibit
Number Description
------- -----------
<S> <C>
23.2 Consent of Arthur Andersen LLP, independent public accountants.*
23.3 Consent of Bateman & Co., Inc., P.C., independent certified public accountants.*
23.4 Consent of Netherland, Sewell & Associates, Inc. *
</TABLE>
--------------------
* Filed herewith.
** Incorporated herein by reference.
*** To be filed by Amendment.
Item 17. Undertakings
------------
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.
The undersigned Registrant hereby undertakes:
(1) 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 the purpose 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) To file, during any period in which it offers or sells securities, a
post-effective amendment to this Registration Statement:
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act;
(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 thereto) that, individually or
in the aggregate, represent a fundamental change in the
information set forth in the Registration Statement;
(iii) to include any additional or changed material information on
the plan of distribution.
20
<PAGE> 23
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, in the City of New
York, State of New York on the 26th day of October, 2000.
GREKA ENERGY CORPORATION
By: /s/ Randeep S. Grewal
----------------------------------
Randeep S. Grewal, Chief Executive
Officer, and Chairman of the Board
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates stated.
<TABLE>
<CAPTION>
Signature Title Date
<S> <C> <C>
/s/ Randeep S. Grewal Chairman of the Board of October 26, 2000
--------------------- Directors and Chief
Randeep S. Grewal Executive Officer
(Principal Executive
Officer, Financial Officer
and Accounting Officer)
/s/ Jan F. Holtrop Director October 26, 2000
----------------------
Dr. Jan F. Holtrop
/s/ Kenton D. Miller Director October 26, 2000
--------------------
Kenton D. Miller
/s/ George G. Andrews Director October 26, 2000
---------------------
George G. Andrews
/s/ Dai Vaughan Director October 26, 2000
---------------
Dai Vaughan
</TABLE>
21
<PAGE> 24
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
-----------
EXHIBITS
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933, AS AMENDED
GREKA ENERGY CORPORATION
-----------------------------------------
(Name of Company as specified in charter)
<PAGE> 25
GREKA ENERGY CORPORATION
FORM S-3 REGISTRATION STATEMENT
The following Exhibits are filed as part of the Registrant's Form S-3
Registration Statement pursuant to Item 601 of Regulation S-K.
The following Exhibits are filed as part of this Form S-3 Registration
Statement pursuant to Item 601 of Regulation S-K or incorporated by reference to
other filings:
<TABLE>
<CAPTION>
Exhibit
Number Description
------- -----------
<S> <C>
4.1 Form of 9% Subordinated Debenture with Conversion Privileges Agreement. (filed as Exhibit 4.1
to Post Effective Amendment No. 1 to the registration statement on Form S-2, file no. 333-45352,
and incorporated by reference herein).
4.2 Form of 15% Subordinated Debenture with Conversion Privileges Agreement (filed as Exhibit 4.2
to Post Effective Amendment No. 1 to the registration statement on Form S-2, file no. 333-45352,
and incorporated by reference herein).
4.3 Form of Warrant to Purchase Common Stock( filed as Exhibit 4.3 to Post Effective Amendment No. 1 to the
registration statement on Form S-2, file no. 333-45352, and incorporated by reference herein).
4.4 Form of Class B Warrant( filed as Exhibit 4.4 to Post Effective Amendment No. 1 to the
registration statement on Form S-2, file no. 333-45352, and incorporated by reference herein).
5.1 Opinion of Ballard Spahr Andrews & Ingersoll, LLP concerning the legality of the common stock
offered hereby.**
23.1 Consent of Ballard Spahr Andrews & Ingersoll, LLP (included in Exhibit 5.1 to this registration
statement).*
23.2 Consent of Arthur Andersen LLP, independent public accountants.*
23.3 Consent of Bateman & Co., Inc., P.C., independent certified public accountants.*
23.4 Consent of Netherland, Sewell & Associates, Inc. *
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* Filed herewith.
** To be filed by Amendment.
