UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
Quarterly Report pursuant to Section 13 or 15(d) of the
[X] Securities Exchange Act of 1934
For the Quarterly Period Ended March 31, 1999
OR
Transition Report Pursuant to Section 13 or 15(d) of
[ ] the Securities Exchange Act of 1934
Commission File No. 1-10669
XCL Ltd.
(Exact name of registrant as specified in its charter)
Delaware 51-0305643
(State of Incorporation) (I.R.S. Employer
Identification Number)
110 Rue Jean Lafitte, Lafayette, LA
70508
(Address of principal executive offices)
(Zip Code)
318-237-0325
(Registrant's telephone number, including area code)
N/A
(Former name, former address and former fiscal year, if
changed since last report)
Indicate by check mark whether the registrant (1) has
filed all reports required to be filed by Section 13 or
15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has
been subject to such filing requirements for the past 90
days. YES [X] NO [ ]
Indicate the number of shares outstanding of each of
the issuer's classes of common stock, as of the latest
practicable date.
23,377,971 shares Common Stock, $.01 par value were
outstanding on May 14, 1999.
XCL LTD.
TABLE OF CONTENTS
Page
PART I
Item 1. Financial Statements 3
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 14
Item 3. Quantitative and Qualitative Disclosures About
Market Risk 18
PART II
Item 1. Legal Proceedings 19
Item 2. Changes in Securities 19
Item 3. Default Upon Senior Securities 20
Item 4. Submission of Matters to a Vote of Security Holders 20
Item 6. Exhibits and Reports on Form 8-K. 20
XCL Ltd. and Subsidiaries
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
CONSOLIDATED BALANCE SHEETS
(In Thousands)
(Unaudited)
March 31, December 31,
ASSETS 1999 1998
------ --------- ------------
Current assets:
Cash and cash equivalents $ 86 $ 83
Cash held in escrow (restricted) 182 205
Other 520 443
-------- -------
Total current assets 788 731
-------- -------
Property and equipment:
Oil and gas (full cost method):
Proved undeveloped properties, not being
amortized 30,009 28,274
Unevaluated properties 62,579 58,403
------- -------
92,588 86,677
Other 1,344 1,344
------- -------
93,932 88,021
Accumulated depreciation, depletion and
amortization (776) (761)
------- -------
93,156 87,260
------- -------
Investments 4,087 4,078
Investment in land 12,200 12,200
Oil and gas properties held for sale 5,086 5,099
Debt issue costs, less amortization 3,617 3,763
Other assets 1,487 1,542
------- -------
Total assets $ 120,421 $ 114,673
======= =======
LIABILITIES AND SHAREHOLDERS' EQUITY
-------------------------------------
Current liabilities:
Accounts payable and accrued expenses $ 2,085 $ 1,465
Accrued interest 4,934 2,049
Due to joint venture partner 10,146 8,168
Dividends payable 4,233 1,658
Notes payable 3,572 2,974
------- -------
24,970 16,314
Senior secured notes reclassification 63,994 63,457
------- -------
Total current liabilities 88,964 79,771
------- -------
Long-term debt, net of current maturities -- --
Other liabilities 5,459 5,428
Commitments and contingencies (Note 6)
Shareholders' equity:
Preferred stock-$1.00 par value; authorized 2.4
million shares; issued shares of 1,282,745 at
March 31, 1999 and December 31, 1998 -
liquidation preference of $110 million at
March 31, 1999 1,283 1,283
Preferred stock held in treasury -
$1.00 par value; 9,681 shares at
March 31, 1999 (10) --
Common stock-$.01 par value; authorized 500
million shares; issued shares of 23,377,971
at March 31, 1999 and 23,447,441 at
December 31, 1998 233 234
Common stock held in treasury-$0.01 par value:
69,470 shares at December 31, 1998 -- (1)
Additional paid-in capital 297,750 296,373
Accumulated deficit (265,005) (260,215)
Unearned compensation (8,253) (8,200)
------- -------
Total shareholders' equity 25,998 29,474
------- -------
Total liabilities and
shareholders'equity $ 120,421 $ 114,673
======= =======
The accompanying notes are an integral part of these financial statements.
XCL Ltd. and Subsidiaries
CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands, Except Per Share Amounts)
(Unaudited)
Three Months Ended
March 31,
-------------------
1999 1998
---- ----
Costs and operating expenses:
General and administrative costs $ 1,029 $ 1,610
Other, net 34 43
------ ------
1,063 1,653
------ ------
Operating loss (1,063) (1,653)
------ ------
Other income (expense):
Interest expense, net of amounts capitalized (1,270) (762)
Interest income 2 409
Other, net 344 (9)
------ ------
(924) (362)
------ ------
Net loss (1,987) (2,015)
Preferred stock dividends (2,803) (2,427)
------ ------
Net loss attributable to common stock $ (4,790) $ (4,442)
====== ======
Net loss per share (basic) $ (0.20) $ (0.20)
====== ======
Net loss per share (diluted) $ (0.20) $ (0.20)
====== ======
Weighted average number of common shares outstanding:
Basic 23,373 22,318
Diluted 23,373 22,318
The accompanying notes are an integral part of these financial statements.
XCL Ltd. and Subsidiaries
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
(In Thousands)
(Unaudited)
Preferred Common
Stock Stock Additional Total
Preferred Held In Common Held In Paid-In Accumulated Unearned Shareholders'
Stock Treasury Stock Treasury Capital Deficit Compensation Equity
-------- -------- ----- -------- -------- --------- ------------ --------
Balance, December 31, 1998 $1,283 $ -- $ 234 $ (1) $ 296,373 $(260,215) $(8,200) $ 29,474
Net loss -- -- -- -- -- (1,987) -- (1,987)
Dividends -- -- -- -- 227 (2,803) -- (2,576)
Preferred shares converted
to treasury shares -- (10) -- -- 10 -- -- --
Treasury shares retired -- -- (1) 1 -- -- -- --
Issuance of stock purchase
warrants -- -- -- -- 890 -- -- 890
Accretion of unearned
compensation -- -- -- -- 53 -- (53) --
Earned compensation -
stock options -- -- -- -- 197 -- -- 197
----- ---- ---- ---- ------- -------- ------- ------
Balance, March 31, 1999 $1,283 $ (10) $ 233 $ -- $ 297,750 $(265,005) $(8,253) $ 25,998
===== ==== ==== ==== ======= ======== ====== ======
The accompanying notes are an integral part of these financial statements.
XCL Ltd. and Subsidiaries
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
(Unaudited)
Three Months Ended
March 31,
-------------------
1999 1998
---- ----
Cash flows from operating activities:
Net loss $ (1,987) $ (2,015)
------- -------
Adjustments to reconcile net loss to net cash
provided by operating activities:
Depreciation, depletion and amortization 29 24
Amortization of discount on debt and loan costs 1,315 703
Stock compensation programs 197 366
Stock issued for outside professional services -- 223
Change in operating assets and liabilities:
Accounts receivable -- (32)
Refundable deposits -- 1,000
Accounts payable and accrued expenses 620 (26)
Accrued interest (85) 559
Other, net 8 (160)
------- ------
Total adjustments 2,084 2,657
------- ------
Net cash provided by operating activities 97 642
------- ------
Cash flows from investing activities:
Change in cash held in escrow (restricted) 23 (54)
Capital expenditures (964) (3,965)
Investments (9) (357)
------ -------
Net cash used in investing activities (950) (4,376)
------ -------
Cash flows from financing activities:
Proceeds from issuance of debt 950 --
Proceeds from exercise of warrants and options -- 331
Payment of long-term debt (94) (150)
Other -- (297)
------ ------
Net cash provided by (used in) financing
activities 856 (116)
------ ------
Net increase (decrease) in cash and cash equivalents 3 (3,850)
Cash and cash equivalents at beginning of period 83 21,952
------ -------
Cash and cash equivalents at end of period $ 86 $ 18,102
====== =======
The accompanying notes are an integral part of these financial statements.
XCL Ltd. and Subsidiaries
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
March 31, 1999
(1) Basis of Presentation
The consolidated financial statements at March 31,
1999, and for the three months then ended have been prepared
by the Company, without audit, pursuant to the Rules and
Regulations of the Securities and Exchange Commission. The
Company believes that the disclosures are adequate to make
the information presented herein not misleading. These
consolidated financial statements should be read in
conjunction with the financial statements and the notes
thereto included in the Company's Annual Report on Form 10-K
for the year ended December 31, 1998. The balance sheet at
December 31, 1998, included herein, has been derived from
the audited financial statements at that date, but does not
include all of the information and footnotes required by
generally accepted accounting principles for complete
financial statements. In the opinion of management all
adjustments, consisting only of normal recurring
adjustments, necessary to present fairly the financial
position of XCL Ltd. and subsidiaries as of March 31, 1999,
and the results of its operations for the three months ended
March 31, 1999 and 1998, have been included. Certain
reclassifications have been made to prior period financial
statements to conform to current year presentation. These
reclassifications had no effect on net loss or shareholders'
equity. The results of the Company's operations for such
interim periods are not necessarily indicative of the
results for the full year.
(2) Liquidity and Capital Resources
The Company, in connection with its 1995 decision to
dispose of its domestic properties, is generating minimal
annual revenues and is devoting all of its efforts toward
the development of its China properties. The Company has
cash available of approximately $86,000 as of March 31,
1999, and a working capital deficit of $88.2 million. The
Senior Secured Notes (the "Notes") in the amount of $64
million (net of unamortized discount of $11 million) have
been reclassified to current liabilities because the Company
did not have sufficient funds to make the May 1999 interest
payment (in the approximate amount of $5.6 million). On May
3, 1999, the Company failed to make the required interest
payment. Absent an agreement with the Note holders extending
the payment terms, the holders of the Notes could declare
all amounts outstanding immediately due and payable. The
Company is in negotiations with the holders of the Notes
regarding this matter. Additional funds will also be needed
to meet all of the Company's development and exploratory
obligations until sufficient cash flows are generated from
anticipated production to sustain its operations and to fund
future development and exploration obligations.
As more fully disclosed in Note 6, the Company is
obligated to meet certain minimum contractual requirements
covering the Zhao Dong and Zhang Dong Blocks in China.
Failure by the Company to meet such obligations, or secure
an extension of time in order to complete such contractual
requirements, may result in the sale or surrender of all or
part of its interest in those properties, and/or its other
interests in China. If such properties are sold or
surrendered, there can be no assurance that the Company
would recover its carrying value.
Management plans to generate the additional cash needed
through the sale or financing of its domestic assets held
for sale and the completion of additional equity, debt or
joint venture transactions. There is no assurance, however,
that the Company will be able to sell or finance its assets
held for sale or to complete other transactions in the
future at commercially reasonable terms, if at all, or that
it will be able to meet its future contractual obligations.
If production from the China properties commences in late
1999 or 2000, as anticipated, the Company's proportionate
share of the related cash flow will be available to help
satisfy a portion of its cash requirements. However, there
is likewise no assurance that such development will be
successful and production will commence, and that such cash
flow will be available.
(3) Supplemental Cash Flow Information
There were no income taxes paid during the three-month
periods ended March 31, 1999 and 1998.
Capitalized interest for the three-month periods ended
March 31, 1999 and 1998 was $3.0 million and $2.7 million
respectively. Interest paid during the three-month periods
ended March 31, 1999 and 1998 amounted to approximately
$21,000 and $38,000, respectively.
(4) Debt
Debt consists of the following (000's):
March 31, December 31,
1999 1998
--------- -----------
Senior secured notes, net of unamortized discount
of $11,006 and $11,543, respectively $ 63,994 $ 63,457
====== ======
Notes payable:
Lutcher Moore Group Limited Recourse Debt 1,380 1,474
XCL Land, Ltd. secured notes, net of unamortized
discount of $258 and $0, respectively 2,042 1,500
Other 150 --
----- -----
$ 3,572 $ 2,974
===== =====
Substantially all of the Company's assets collateralize
these borrowings.
Senior Secured Notes
- --------------------
The long-term portion of the Senior Secured Notes has
been reclassified to a current liability because the Company
did not have sufficient funds to make the May 1999 interest
payment (in the approximate amount of $5.6 million). On May
3, 1999, the Company failed to make such required interest
payment. Absent an agreement with the Note holders extending
the payment terms, the holders of the Notes could declare
all amounts outstanding immediately due and payable. The
Company is in negotiations with the holders of the Notes
regarding this matter.
XCL Land, Ltd. Secured Notes
- ----------------------------
In November 1998, the Company, through its wholly owned
subsidiary, XCL Land, Ltd., issued an aggregate of 15 units,
each unit comprised of a secured note in the principal
amount of $100,000 each and five-year warrants, exercisable
at $3.50 per share, to purchase 21,705 shares of Common
Stock of the Company in a short-term financing with three
lenders. The lenders were granted a security interest in a
portion of the partnership interests of XCL Land, Ltd. and
The Exploration Company of Louisiana, Inc., in L.M. Holding
Associates, L.P., the owner of the Lutcher Moore Tract. The
notes bear interest at 15% per annum and are payable in 90
days, with the option for two 90-day extensions, the second
of which must be approved by the respective lender. XCL
Land, Ltd. received $1.5 million in proceeds, of which
approximately $704,000 was allocated to the warrants. The
value allocated to the warrants is being amortized to
interest expense over the term of the notes. At March 31,
1999, the unamortized discount is approximately $133,000.
Approximately $0.7 million in proceeds were used to pay
outstanding indebtedness associated with the Lutcher Moore
Tract and the remaining $0.8 million in proceeds were paid
as a dividend to the Company to be used by the Company as
working capital.
In January 1999, the Company through its wholly owned
subsidiary, XCL Land, Ltd. issued an aggregate of five
additional units on the same terms as the units issued in
November 1998, except that the exercise price of the
warrants was $2.00 per share. In connection with the
additional subscriptions and pursuant to the terms of the
subscription agreements, the exercise price of the warrants
issued in the November 6, 1998, offering was reduced to
$2.00 per share. XCL Land, Ltd. received $0.5 million in
proceeds, of which approximately $120,000 was allocated to
the warrants. The value allocated to the warrants is being
amortized to interest expense over the term of the notes. At
March 31, 1999, the unamortized discount is approximately
$69,000. All of the proceeds were paid as a dividend to the
Company to be used by the Company as working capital.
During March 1999, the Company, through XCL Land, Ltd.,
issued an aggregate of two additional units, on the same
terms as the units issued in January 1999, except that the
exercise price of the warrants was $1.50 per share. In
connection with the additional subscriptions and pursuant to
the terms of the subscription agreements, the exercise price
for the warrants issued in the November 1998, and January
1999 offerings, was reduced to $1.50 per share. XCL Land,
Ltd. received $200,000 in proceeds, of which approximately
$43,000 was allocated to the warrants. The value allocated
to the warrants is being amortized to interest expense over
the term of the notes. At March 31, 1999, the unamortized
discount is approximately $41,000. All of the proceeds were
paid as a dividend to the Company to be used by the Company
as working capital.
During April 1999, the Company, through XCL Land, Ltd.,
issued two additional units, on the same terms as the units
issued in November 1998, January 1999 and March 1999, except
that the exercise price of the warrants was $1.3125 per
share. In connection with the additional subscriptions and
pursuant to the terms of the subscription agreements, the
exercise price of the warrants issued in the November 1998,
January 1999 and March 1999 offerings, was reduced to
$1.3125 per share. XCL Land, Ltd. received $200,000 in
proceeds, of which approximately $36,000 was allocated to
the warrants. The value allocated to the warrants is being
amortized to interest expense over the term of the notes.
All of the proceeds were paid as a dividend to the Company
to be used by the Company as working capital.
Also during March 1999, the Company, through XCL Land,
Ltd., issued a secured note in the principal amount of
$100,000 and five-year warrants, exercisable at $1.25 per
share, to purchase 10,000 shares of Common Stock of the
Company in a short term financing with one lender. The
lender was granted a security interest in a portion of the
partnership interests of XCL Land, Ltd. and The Exploration
Company of Louisiana, Inc., in L.M. Holding Associates,
L.P., the owner of the Lutcher Moore Tract. The note bears
interest at 15% per annum and is payable in 45 days. XCL
Land, Ltd. received $100,000 in proceeds, of which approxi-
mately $24,000 was allocated to the warrants. The value
allocated to the warrants is being amortized to interest
expense over the term of the note. At March 31, 1999,
the unamortized discount is approximately $15,000. All of
the proceeds were paid as a dividend to the Company to be
used by the Company as working capital.
(5) Preferred Stock and Common Stock
As of March 31, 1999, the Company had the following
shares of Preferred Stock issued and outstanding:
1999 Dividends (In Thousands)
Liquidation ----------------------------
Shares Value Declared Accrued Total
--------- ----------- -------- ------- -----
Amended Series A 1,231,897 $ 104,711,245 $ -- $ 4,114 $ 4,114
Amended Series B 50,848 5,084,800 -- 119 119
--------- ----------- ---- ------ -----
1,282,745 $ 109,796,045 $ -- $ 4,233 $ 4,233
========= =========== ==== ====== =====
During the three month period ended March 31, 1999,
approximately $227,000 was amortized to preferred stock
dividends, which represents an accretion of the value of the
Amended Series A Preferred Stock to its mandatory redemption
value.
Amended Series A Preferred Stock
- --------------------------------
During the quarter ended March 31, 1999, the unclaimed
shares of Amended Series A Preferred Stock resulting from
the amendment, recapitalization and conversion of the Series
A, Cumulative Convertible Preferred Stock and Series E,
Cumulative Convertible Preferred Stock, including dividends
accrued thereon through November 10, 1998, were reclassified
as treasury stock. Pursuant to the terms of the amendment,
recapitalization and conversion, dividends have ceased to
accrue on the unclaimed shares.
Loss Per Share
- --------------
The following table sets forth the computation of basic
and diluted loss per share (in 000's, except for per share
amounts):
For the Three Months Ended
March 31,
____________________
1999 1998
---- ----
Number of shares on which basic loss per share is
calculated: 23,373 22,318
Number of shares on which diluted loss per share is
calculated: 23,373 22,318
Net loss applicable to common shareholders $ (4,790) $ (4,442)
Basic loss per share $ (0.20) $ (0.20)
Diluted loss per share $ (0.20) $ (0.20)
The effect of 37,351,974 and 33,771,929 shares of
potential common stock were anti-dilutive in the three
months ended March 31, 1999 and 1998, respectively, due to
the losses in both periods.
(6) Commitments and Contingencies
Other commitments and contingencies include:
o The Company acquired the rights to the exploration,
development and production of the Zhao Dong Block by
executing a Production Sharing Agreement with CNODC in
February 1993. Under the terms of the Production Sharing
Agreement, the Company and its partner are responsible for
all exploration costs. If a commercial discovery is made,
and if CNODC exercises its option to participate in the
development of the field, all development and operating
costs and related oil and gas production will be shared up
to 51 percent by CNODC and the remainder by the Company and
its partner.
The Production Sharing Agreement includes the
following additional principal terms:
The Production Sharing Agreement is basically
divided into three periods: the Exploration
period, the Development period and the Production
period. Work to be performed and expenditures to
be incurred during the Exploration period, which
consists of three phases totaling seven years from
May 1, 1993, are the exclusive responsibility of
the Contractor (the Company and its partner as a
group). The Contractor's obligations in the three
exploration phases are as follows:
1. During the first three years, the
Contractor is required to drill three wildcat
wells, perform seismic data acquisition and
processing and expend a minimum of $6
million. These obligations have been met.
2. During the next two years, the Contractor
is required to drill two wildcat wells,
perform seismic data acquisition and
processing and expend a minimum of $4
million. These obligations have been met.
3. During the last two years, the Contractor
is required to drill two wildcat wells and
expend a minimum of $4 million. The
Contractor has elected to proceed with the
third phase of the Exploration Period.
4. The Production Period for any oil and/or
gas field covered by the Contract (the
"Contract Area") will be 15 consecutive years
(each of 12 months), commencing for each such
field on the date of commencement of
commercial production (as determined under
the terms of the Production Sharing
Agreement). However, prior to the Production
Period, and during the Development Period,
oil and/or gas may be produced and sold
during a long-term testing period.
The Contractor may terminate the Production
Sharing Agreement at the end of each phase of the
Exploration period, without further obligation.
The Company currently estimates that its share of
the development costs on proved reserves
associates with the Zhao Dong Block to be
approximately $35.5 million.
o The Company, through its wholly owned subsidiary XCL-
Cathay Ltd., acquired the rights to appraisal, development
and production of the Zhang Dong Block, in the Bohai Bay
shallow water sea area, by executing a Petroleum Contract
(the "Contract") with China National Petroleum Corporation
("CNPC") in August 1998. The Company is the Contractor.
The Contractor shall pay all appraisal costs. If CNPC
exercises its option to participate in the development of
the field, all development and operating costs and related
oil and gas production will be shared up to 51 percent by
CNPC and the remainder by the Company.
The Contract is basically divided into three
periods: the Appraisal period, the Development
period and the Production period. Work to be
performed and expenditures to be incurred during
the Appraisal period, which consists of three
phases totaling five years from October 1, 1998,
are the exclusive responsibility of the Company.
The Contractor's obligations in the three
appraisal phases are as follows:
1. During the first year, the Contractor is
required to drill one appraisal well, perform
seismic data processing, upgrade the
artificial island and causeway, and expend a
minimum of $4 million.
2. During the next two years, the Contractor
is required to drill two appraisal wells,
make additional improvements to the
artificial island if Contractor elects to
drill from such facility, re-evaluate a
minimum of three existing wellbores,
formulate a development program for any field
determined to be commercial, and expend a
minimum of $6 million.
3. During the last two years, the Contractor
is required to drill two appraisal wells and
expend a minimum of $6 million.
4. The Production Period for any oil and/or
gas field covered by the Agreement will be 20
consecutive years (each of 12 months),
commencing for each such field on the date of
commencement of commercial production (as
determined under the terms of the Contract).
However, prior to the Production Period, and
during the Development Period, oil and/or gas
may be produced and sold during a long-term
testing period.
The Contractor may terminate the Contract at the
end of either the first or second phase of the
Appraisal period, without further obligation.
o The Company has not yet paid certain cash calls to
Apache totaling approximately $7.3 million through May 1999
(approximately $6.6 million at March 31, 1999), including
amounts in dispute. On December 1, 1995, XCL-China
submitted to arbitration certain accounting disputes arising
from operations in the Bohai Bay Shallow Water Sea Area,
People's Republic of China and governed by a Zhao Dong Block
Operating Agreement. By the initial submission, XCL-China
disputed certain amounts charged to it by Apache in the
August, September and October 1995 joint interest billings
and the November and December 1995 cash calls which could
develop into an event that would trigger Apache's option to
purchase the Company's interest in the Production Sharing
Agreement. Thereafter, disputes involving joint interest
billings through December 1998 were added to the submission.
In 1997, XCL-China made some payments with respect to the
disputed amounts although the arbitration proceeding remains
unresolved and inactive inasmuch as a third arbitrator has
not been selected.
o The Company is in dispute over a 1992 tax assessment
(including penalties and interest through March 31, 1999) by
the Louisiana Department of Revenue and Taxation for the
years 1987 through 1991 in the approximate amount of $3.1
million. The Company is in dispute over a 1997 assessment
(including penalties and interest through March 31, 1999)
from the Louisiana Department of Revenue and Taxation for
income tax years 1991 and 1992, and franchise tax years 1992
through 1996 in the approximate amount of $3.3 million. The
Company has filed written protests as to these assessments,
and will vigorously contest the asserted deficiencies
through the administrative appeals process and, if
necessary, litigation. The Company believes that adequate
provision has been made in the financial statements for any
liability.
o On July 26, 1996, an individual filed three lawsuits
against a wholly owned subsidiary with respect to oil and
gas properties held for sale. One suit alleges actual
damage of $580,000 plus additional amounts that could result
from an accounting of a pooled interest. Another seeks
legal and related expenses of $56,473 from an allegation the
plaintiff was not adequately represented before the Texas
Railroad Commission. The third suit seeks a declaratory
judgement that a pooling of a 1938 lease and another in 1985
should be declared terminated and further plaintiffs seek
damages in excess of $1 million to effect environmental
restoration. The Company believes these claims are without
merit and intends to vigorously defend itself.
o The Company is subject to other legal proceedings that
arise in the ordinary course of its business. In the
opinion of Management, the amount of ultimate liability with
respect to these actions will not materially affect the
financial position of the Company or results of operations
of the Company.
(7) XCL-China Ltd.
The following summary financial information of XCL-
China Ltd., a wholly owned subsidiary, reflects its
financial position and its results of operations for the
periods presented (in thousands of dollars):
March 31, December 31,
1999 1998
ASSETS -------- ------------
------
Current assets $ 313 $ 174
Oil and gas properties (full cost method):
Proved undeveloped properties, not
being amortized 30,009 28,274
Unevaluated properties 60,361 56,708
------ ------
90,370 84,982
Other 417 416
------ ------
90,787 85,398
Accumulated depreciation (8) (5)
------ ------
90,779 85,393
Other assets 327 359
------ ------
$ 91,419 $ 85,926
====== ======
LIABILITIES AND SHAREHOLDER'S DEFICIT
----------------------------------------
Total current liabilities $ 10,553 $ 8,397
Due to parent 83,803 80,425
Accumulated deficit (2,937) (2,896)
------ ------
$ 91,419 $ 85,926
====== ======
Three Months Ended
March 31,
-------------------
1999 1998
---- ----
Costs and expenses $ 41 $ 262
------ ------
Net loss $ (41) $ (262)
====== ======
XCL LTD. AND SUBSIDIARIES
March 31, 1999
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations
Outlook
- -------
Cautionary Statement Pursuant to Safe Harbor Provisions
of the Private Securities Litigation Reform Act of 1995.
This report contains "forward-looking statements"
within the meaning of the federal securities laws. These
forward-looking statements include, among others, statements
concerning the Company's outlook for 1999 and beyond, the
Company's expectations as to funding its capital
expenditures and other statements of expectations, beliefs,
future plans and strategies, anticipated events or trends,
and similar expressions concerning matters that are not
historical facts. The forward-looking statements in this
report are subject to risks and uncertainties that could
cause actual results to differ materially from those
expressed in or implied by the statements.
Liquidity and Capital Resources
- -------------------------------
The Company has generated minimal cash from operations
since the fourth quarter of 1995, when management made the
decision to focus its attention on operations in China and
to sell its other assets. This decision is supported by the
excellent well test results on the China properties.
At March 31, 1999, the Company had a net working
capital deficit of $88.2 million. The Company does not have,
as of May 14, 1999, sufficient funds to cover the Company's
working capital requirements and capital expenditure
obligations on the Zhao Dong and Zhang Dong Blocks during
1999.
In addition, the Company failed to make the interest
payment on the Senior Secured Notes (in the approximate
amount of $5.6 million) due on May 3, 1999. Absent an
agreement with the Note holders extending the payment terms,
the Company has a 30-day grace period to make the interest
payment. Failure to do so may allow the holders of the
Notes to declare all amounts outstanding under the Notes,
and accrued interest, immediately due and payable. The
Company is in negotiations with the holders of the Notes
regarding this matter. The possible results include the
Company's loss of the stock of XCL-China and/or its interest
in the Contract. The Company is exploring options for
meeting its obligations under the Notes and expects to
arrive at a satisfactory resolution. There can be no
assurance, however, that a satisfactory resolution will
result.
The Company has not yet paid certain cash calls to
Apache totaling approximately $7.3 million through May 1999,
(approximately $6.6 million at March 31, 1999), including
amounts in dispute, which could develop into an event that
would trigger Apache's option to purchase the Company's
interest in the Contract. The Company and Apache are in
discussions concerning the timing and manner of the payment
of these amounts.
The Company believes that its plans for the Zhao Dong
Block continue to be economically feasible at current oil
prices. Should such prices decline, it will reduce the
Company's projected economic return from the project and may
further impair the Company's ability to meet its debt
service requirements.
As a result of the Company's decision to focus on China
and sell its U.S. assets, the Company presently has no
source of significant revenues. The Company incurred a loss
for fiscal 1998 of $13.8 million and expects to incur a loss
in 1999 as well because production and related cash flow
from the Zhao Dong and Zhang Dong Blocks are not expected
until late 1999, at the earliest.
With respect to the C-D Field on the Zhao Dong Block,
CNODC has given written notice that it will participate as
to its full 51% share and has urged that production begin as
soon as reasonably practicable. Except for certain
exploratory wells on which Apache has an obligation to pay
for the Company's costs, the Company is required to fund 50%
of all exploration expenditures and 24.5% of all development
and production expenditures.
The Company estimates that its share of development
expenses for 1999 will be approximately $13.7 million and
its share of exploration expenses for the remaining two
obligatory wells to be drilled prior to the end of the
Exploration Period (which expires April 30, 2000) is
approximately $5.0 million. The Company expects that at
least one of these wells will be drilled in 1999. The
Company presently projects and plans that these funds will
be available from the sale or refinancing of domestic oil
and gas properties held for sale and/or investment in land,
project financing, an increase in the amount of senior
secured notes, supplier financing, additional equity
(including the exercise of currently outstanding warrants to
buy common stock), joint ventures with other oil companies,
or proceeds from production. Based on continuing discussions
with major shareholders, investment bankers, potential
purchasers and other oil companies, the Company believes
that such required funds will be available. However, there
is no assurance that such funds will be available and, if
available, on commercially reasonable terms. Any new debt
could require approval of the holders of the Notes and there
is no assurance that such approval could be obtained.
The $18.7 million estimated to be necessary for
exploration and development in 1999 on the Zhao Dong Block
does not include the cost of accelerating production from
the C-4 Well area into 1999. If the Company pursues this
option, the Company estimates this would require additional
expenditures of approximately $1.5 million, which the
Company believes it can obtain from the sources described
above.
In addition, the Company is the operator of the Zhang
Dong Block and, as such, is required to cover the costs of
initial appraisal drilling, upgrading production facilities
and additional studies of seismic data. The Contract
commits the Company to drill at least one well during the
first year. Under the Contract, the Company is entitled to
49% of the production. The Company estimates that its
minimum capital requirements over the next year to satisfy
the terms of the Zhang Dong Contract are approximately $6.5
million. This amount is not included in the $18.7 million
the Company expects to spend on the Zhao Dong Block during
1999. Funds are expected to come from the previously
mentioned sources.
Longer-term liquidity is dependent upon the Company's
future performance, including commencement of production in
China, as well as continued access to capital markets. In
addition, the Company's efforts to secure additional
financing could be impaired if its Common Stock is delisted
from the AMEX.
If funds for the purposes described above and for
general and administrative expenses are not available, the
Company may be required to substantially curtail its
operations or to sell or surrender all or part of its
interest in the Zhao Dong or the Zhang Dong Blocks and/or
its other interests in China in order to meet its
obligations and continue as a going concern. If those
properties are sold or surrendered, there can be no
assurance that the Company would recover its carrying value.
The Company is not obligated to make any additional
capital payments to its lubricating oil and coalbed methane
projects. The Company is in discussions with the Chinese
government about expansion of its lube oil venture. The
Company will require additional capital investments if these
discussions are successfully concluded; however, at this
time it is not known what the extent or timing for such
investments might be. Similarly, if the Company's coalbed
methane project becomes active and is successful, the
Company may make additional investments in that business.
Again, the extent and timing of such investment, if any, is
unknown at this time.
Other
- -----
The Company believes that inflation has had no material
impact on its sales, revenues or income during the reporting
periods.
The Company is subject to existing domestic and Chinese
federal, state and local laws and regulations governing
environmental quality and pollution control. Although
management believes that such operations are in general
compliance with applicable environmental regulations, risks
of substantial costs and liabilities are inherent in oil and
gas operations, and there can be no assurance that
significant costs and liabilities will not be incurred.
New Accounting Pronouncements
- -----------------------------
In June 1998, FASB issued SFAS No. 133, "Accounting for
Derivative Instruments and Hedging Activities." The
statement requires companies to report the fair market value
of derivatives on the balance sheet and record in income or
other comprehensive income, as appropriate, any changes in
the fair value of the derivative. SFAS No. 133 will become
effective with respect to the Company on January 1, 2000.
The Company is currently evaluating the impact of the
statement.
Results of Operations
- ---------------------
During the three-month periods ended March 31, 1999 and
1998, the Company incurred net losses of $2.0 million and
$2.0 million, respectively.
Revenues and operating expenses associated with oil and
gas properties held for sale have become insignificant and
accordingly, are recorded in other costs and operating
expenses in the accompanying consolidated statements of
operations.
Interest expense, net of amounts capitalized, for the
three-month period ended March 31, 1999 was approximately
$1.3 million compared to approximately $0.8 million for the
same period in 1998. The increase was primarily
attributable to the discount amortization of the XCL Land,
Ltd. secured notes in the amount of approximately $0.6
million during the three-month period ended March 31, 1999.
This increase was slightly offset by the increased
capitalization of interest costs due to increased balances
in qualifying assets.
General and administrative expenses were $1.0 million
for the three-month period ended March 31, 1999, as compared
to $1.6 million for the same period in 1998. The decrease
of $0.6 million was primarily attributable to salary and
staff reductions of approximately $0.2 million, reductions
in the amounts required to be expensed for the Company's
CEO's appreciation option of approximately $0.2 million,
reduction in public company costs of approximately $0.1
million and reduction in legal and professional fees of
approximately $0.1 million.
Year 2000 Compliance
- --------------------
The Year 2000 problem is the result of computer
programs being written using two digits (rather than four)
to define the applicable year and equipment with time-
sensitive embedded components. Any of the Company's
programs that have time-sensitive software or equipment that
has time-sensitive embedded components may recognize a date
using "00" as the year 1900 rather than the year 2000. This
could result in a major system failure or miscalculations.
Although no assurance can be given because of the potential
wide scale manifestations of this problem which may affect
the Company's business, the Company presently believes that
the Year 2000 problem will not pose significant operational
problems for its computer systems.
The goal of the Company's Year 2000 project is to
ensure that all of the critical systems and processes that
are under the Company's direct control remain functional.
Certain systems and processes may be interrelated with or
dependent upon systems outside the Company's control, and
systems within the Company's control may have unpredicted
problems. The Company has established a project team to
coordinate the phases of Year 2000 compliance to assure that
the Company's key automated systems and related processes
will remain functional through the year 2000. Those phases
consist of (i) assessment; (ii) remediation; (iii) testing;
(iv) implementation of the necessary modifications; and (v)
contingency planning. All phases of the Company's Year
2000 plan will continue to be modified and adjusted
throughout the year, as additional information becomes
available.
The Company's assessment phase consists of conducting a
company-wide inventory of its key automated systems and
related processes, analyzing and assigning levels of
criticality to those systems and processes, identifying and
prioritizing resource requirements, developing validation
strategies and testing plans, and evaluating business
partner relationships. The portions of the assessment phase
related to internally developed computer applications,
hardware and equipment, and embedded chips are substantially
complete. The Company estimates that it has completed more
than 90 percent of the assessment to determine the nature
and impact of the Year 2000 date change for third-party-
developed software. The assessment phase of the project
also involves efforts to obtain representations and
assurances from third parties, including third party
vendors, that their hardware and equipment products,
embedded chip systems, and software products being used by
or impacting the Company are or will be modified to be Year
2000 compliant. To date, the responses from such third
parties, although generally encouraging, are inconclusive.
As a result, the Company cannot predict the potential
consequences if these or other third parties or their
products are not Year 2000 compliant. The Company is
currently evaluating the exposure associated with such
business partner relationships.
The remediation phase involves converting, modifying,
replacing or eliminating key automated systems identified in
the assessment phase. The Company estimates that it has
completed approximately 90 percent of the remediation phase.
The Company has to date spent approximately $160,000 for
upgrades and/or replacement of certain of its hardware and
software to hardware and software that purports to be Year
2000 compliant. The Company estimates that an additional
expense of $50,000 will be required to replace and/or modify
and install hardware or software identified to date as non-
Year 2000 compliant.
The testing phase involves the validation of the
identified key automated systems. The Company is utilizing
test tools and written test procedures to document and
validate, as necessary, its systems testing. The Company
estimates that approximately 75 percent of the testing phase
has been completed, and expects to be substantially
completed by mid-1999.
The implementation phase involves placing the converted
or replaced key automated systems into operation. In some
cases, this phase will also involve the implementation of
contingency plans needed to support business functions and
processes that may be interrupted by Year 2000 failures that
are outside of the Company's control. The Company has
completed approximately 75 percent of the implementation
phase, and expects to be substantially completed by mid-
1999.
The contingency planning phase consists of developing a
risk profile of the Company's critical business processes
and then providing for actions the Company will pursue to
keep such processes operational in the event of Year 2000
disruptions. The focus of such contingency planning is on
prompt response to any adverse Year 2000 events and a plan
for subsequent resumption of normal operations. The plan is
expected to assess the risk of a significant failure to
critical processes performed by the Company, and to address
the mitigation of those risks. The plan will also consider
any significant failures related to the most reasonably
likely worst case scenario, discussed below, as they may
occur. In addition the plan is expected to factor in the
severity and duration of the impact of a significant
failure. The Company plans to have its contingency plan
completed by mid-1999.
The Company's present analysis of its most reasonably
likely worst case scenario for Year 2000 disruptions
includes failures in the telecommunications and electricity
industries, and its partners in its international operations
to become Year 2000 compliant.
The Company does not expect the costs of its Year 2000
project to have a material adverse effect on its financial
position, results of operations, or cash flows. Based on
information available at this time the Company cannot
conclude that disruptions caused by internal or external
Year 2000 related failures will not have such an effect.
Specific factors that might affect the success of the
Company's Year 2000 efforts and the occurrence of Year 2000
disruption or expense include the failure of the Company or
its outside consultants to properly identify deficient
systems, the failure of the selected remedial action to
adequately address the deficiencies, the failure of the
Company's outside consultants to complete the remediation in
a timely manner (due to shortages of qualified labor or
other factors), unforeseen expenses related to the
remediation of existing systems or the transition to
replacement systems, the failure of third parties to become
Year 2000 compliant or to adequately notify the Company of
potential noncompliance.
Item 3. Qualitative and Quantitative Disclosures About
Market Risk.
The Company had no interest in investments subject to
market risk during the period covered by this report.
XCL LTD. AND SUBSIDIARIES
March 31, 1999
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
Other than as disclosed in the Company's Annual Report
on Form 10-K, there are no material pending legal
proceedings to which the Company or any of its subsidiaries
is a party or to which any of their properties are subject.
Item 2(c). Changes in Securities
The following securities were issued in private placements
with accredited investors in transactions intended to
qualify for the exemption from registration pursuant to
Section 4(2) under the Securities Act of 1933, as amended.
o In January 1999, the Company, through its wholly owned
subsidiary, XCL Land, Ltd. issued an aggregate of five units
comprised of a secured note in the principal amount of
$100,000 each and five-year warrants to purchase 21,705
shares of Common Stock of the Company, on the same terms as
the units issued in November 1998, except that the exercise
price of the warrants was $2.00 per share. In connection
with the additional subscriptions and pursuant to the terms
of the subscription agreements, the exercise price of the
warrants issued in the November 1998 offering, was reduced
to $2.00 per share. XCL Land, Ltd. received $0.5 million in
proceeds, of which approximately $120,000 was allocated to
the warrants. The value allocated to the warrants is being
amortized to interest expense over the term of the notes.
At March 31, 1999, the unamortized discount is approximately
$69,000. All of the proceeds were paid as a dividend to the
Company to be used by the Company as working capital.
o During March 1999, the Company, through XCL Land, Ltd.,
issued an aggregate of two additional units, on the same
terms as the units issued in January 1999, except that the
exercise price of the warrants was $1.50 per share. In
connection with the additional subscriptions and pursuant to
the terms of the subscription agreements, the exercise price
for the warrants issued in the November 1998 and January
1999 offerings, was reduced to $1.50 per share. XCL Land,
Ltd. received $200,000 in proceeds, of which approximately
$43,000 was allocated to the warrants. The value allocated
to the warrants is being amortized to interest expense over
the term of the notes. At March 31, 1999, the unamortized
discount is approximately $41,000. All of the proceeds were
paid as a dividend to the Company to be used by the Company
as working capital.
o During April 1999, the Company, through XCL Land, Ltd.,
issued two additional units, on the same terms as the units
issued in November 1998, January 1999 and March, 1999,
except that the exercise price of the warrants was $1.3125
per share. In connection with the additional subscriptions
and pursuant to the terms of the subscription agreements,
the exercise price for the warrants issued in the November
1998, January 1999 and March 1999 offerings was reduced to
$1.3125 per share. XCL Land, Ltd. received $200,000 in
proceeds, of which aproximately $36,000 was allocated to the
warrants. The value allocated to the warrants is being
amortized to interest expense over the term of the notes.
All of the proceeds were paid as a dividend to the Company
to be used by the Company as working capital.
o Also during March 1999, the Company, through XCL Land,
Ltd., issued a secured note in the principal amount of
$100,000 and five-year warrants, exercisable at $1.25 per
share, to purchase 10,000 shares of Common Stock of the
Company in a short term financing with one lender. The
lender was granted a security interest in a portion of the
partnership interests of XCL Land, Ltd. and The Exploration
Company of Louisiana, Inc., in L.M. Holding Associates,
L.P., the owner of the Lutcher Moore Tract. The note bears
interest at 15% per annum and is payable in 45 days. XCL
Land, Ltd. received $100,000 in proceeds, of which approximately
$24,000 was allocated to the warrants. The value allocated
to the warrants is being amortized to interest expense over
the term of the note. At March 31, 1999, the unamortized
discount is approximately $15,000. All of the proceeds were
paid as a dividend to the Company to be used by the Company
as working capital.
All of the above referenced warrants are first exercisable
six months after issuance.
Item 3. Defaults Upon Senior Securities
On May 3, 1999, the Company failed to make a required
interest payment (in the approximate amount of $5.6 million)
on its Senior Secured Notes. Failure by the Company to make
such payment within the thirty-day grace period would allow
the holders of the Notes to declare all amounts outstanding
immediately due and payable.
Item 4. Submission of Matters to a Vote of Security-
Holders
There were no matters submitted to a vote of the
security holders of the Company during the period covered by
this report.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits required by Item 601 of Regulation S-K.
See Index to Exhibits.
(b) Reports on Form 8-K
There were no reports on Form 8-K filed during the
quarter ended March 31, 1999.
SIGNATURES
Pursuant to the requirements of the Securities and Exchange
Act of 1934, the Registrant has duly caused this report to
be signed on its behalf by the undersigned thereunto duly
authorized.
XCL Ltd.
/s/ Marsden W. Miller, Jr.
By: __________________________
Marsden W. Miller, Jr.
Chief Executive Officer
and Principal Accounting Officer
Date: May 14, 1999
INDEX TO EXHIBITS
Exhibit
- -------
2.0 Not applicable
3.1 Amended and Restated Certificate of Incorporation of
the Company. (Q)(i)
3.2 Amended and Restated By-Laws of the Company. (A)(i)
4.1 Forms of Common Stock Certificates. (P)(i)
4.2 Form of Warrant dated January 31, 1994 to purchase
2,500,000 shares of Common Stock at an exercise price
of $1.00 per share, subject to adjustment, issued to
INCC. (D)(i)
4.3 Form of Registrar and Stock Transfer Agency
Agreement, effective March 18, 1991, entered into
between the Company and Manufacturers Hanover Trust
Company (predecessor to Chemical Bank), whereby
Chemical Bank (now known as ChaseMellon Shareholder
Services) serves as the Company's Registrar and U.S.
Transfer Agent. (E)
4.4 Copy of Warrant Agreement and Stock Purchase Warrant
dated March 1, 1994 to purchase 500,000 shares of
Common Stock at an exercise price of $1.00 per share,
subject to adjustment, issued to EnCap Investments,
L.C. (D)(ii)
4.5 Copy of Warrant Agreement and form of Stock Purchase
Warrant dated March 1, 1994 to purchase an aggregate
600,000 shares of Common Stock at an exercise price of
$1.00 per share, subject to adjustment, issued to
principals of San Jacinto Securities, Inc. in
connection with its financial consulting agreement with
the Company. (D)(iii)
4.6 Form of Warrant Agreement and Stock Purchase Warrant
dated April 1, 1994, to purchase an aggregate 6,440,000
shares of Common Stock at an exercise price of $1.25
per share, subject to adjustment, issued to executives
of the Company surrendering all of their rights under
their employment contracts with the Company. (C)(i)
4.7 Form of Warrant Agreement and Stock Purchase Warrant
dated April 1, 1994, to purchase an aggregate 878,900
shares of Common Stock at an exercise price of $1.25
per share, subject to adjustment, issued to executives
of the Company in consideration for salary reductions
sustained under their employment contracts with the
Company. (C)(ii)
4.8 Form of Warrant Agreement and Stock Purchase Warrant
dated April 1, 1994, to purchase 200,000 shares of
Common Stock at an exercise price of $1.25 per share,
subject to adjustment, issued to Thomas H. Hudson.
(C)(iii)
4.9 Form of Warrant Agreement and Stock Purchase Warrant
dated May 25, 1994, to purchase an aggregate 100,000
shares of Common Stock at an exercise price of $1.25
per share, subject to adjustment, issued to the holders
of Purchase Notes B, in consideration of amendment to
payment terms of such Notes. (C)(iv)
4.10 Form of Warrant Agreement and Stock Purchase
Warrant dated May 25, 1994, to purchase an aggregate
100,000 shares of Common Stock at an exercise price of
$1.25 per share, subject to adjustment, issued to the
holders of Purchase Notes B, in consideration for the
granting of an option to further extend payment terms
of such Notes. (C)(v)
4.11 Form of Purchase Agreement between the Company and
each of the Purchasers of Units in the Regulation S
Unit Offering conducted by Rauscher Pierce & Clark with
closings as follows:
December 22, 1995 116 Units
March 8, 1996 34 Units
April 23, 1996 30 Units
(I)(i)
4.12 Form of Warrant Agreement between the Company and
each of the Purchasers of Units in the Regulation S
Unit Offering conducted by Rauscher Pierce & Clark, as
follows:
Closing Date Warrants Exercise Price
December 22, 1995 6,960,000 $.50
March 8, 1996 2,040,000 $.35
April 23, 1996 1,800,000 $.35 (I)(ii)
4.13 Form of Warrant Agreement between the Company and
Rauscher Pierce & Clark in consideration for acting
as placement agent in the Regulation S Units Offering,
as follows:
Closing Date Warrants Exercise Price
December 22, 1995 696,000 $.50
March 8, 1996 204,000 $.35
April 23, 1996 180,000 $.35 (I)(iii)
4.14 Form of a series of Stock Purchase Warrants issued
to Janz Financial Corp. Ltd. dated August 14, 1996,
entitling the holders thereof to purchase up to
3,080,000 shares of Common Stock at $0.25 per share on
or before August 13, 2001. (L)
4.15 Form of a series of Stock Purchase Warrants dated
November 26, 1996, entitling the following holders
thereto to purchase up to 2,666,666 shares of Common
Stock at $0.125 per share on or before December 31,
1999:
Warrant Holder Warrants
Opportunity Associates, L.P. 133,333
Kayne Anderson Non-Traditional
Investments, L.P. 666,666
Arbco Associates, L.P 800,000
Offense Group Associates, L.P. 333,333
Foremost Insurance Company 266,667
Nobel Insurance Company 133,333
Evanston Insurance Company 133,333
Topa Insurance Company 200,000 (M)(i)
4.16 Form of a series of Stock Purchase Warrants dated
December 31, 1996 (2,128,000 warrants) and January 8,
1997 (2,040,000 warrants) to purchase up to an
aggregate of 4,168,000 shares of Common Stock at $0.125
per share on or before August 13, 2001. (M)(ii)
4.17 Form of Stock Purchase Warrants dated February 6,
1997, entitling the following holders to purchase an
aggregate of 1,874,467 shares of Common Stock at $0.25
per share on or before December 31, 1999:
Warrant Holder Warrants
Donald A. and Joanne R. Westerberg 241,660
T. Jerald Hanchey 1,632,807 (M)(iii)
4.18 Form of a series of Stock Purchase Warrants dated
April 10, 1997, issued as a part of a unit offered with
Unsecured Notes of XCL-China Ltd., exercisable at $0.01
per share on or before April 9, 2002, entitling the
following holders to purchase up to an aggregate of
10,092,980 shares of Common Stock:
Warrant Holder Warrants
Kayne Anderson Offshore L.P. 651,160
Offense Group Associates, L.P. 1,627,900
Kayne Anderson Non-Traditional
Investments, L.P. 1,627,900
Opportunity Associates, L.P. 1,302,320
Arbco Associates, L.P. 1,627,900
J. Edgar Monroe Foundation 325,580
Estate of J. Edgar Monroe 976,740
Boland Machine & Mfg. Co., Inc. 325,580
Construction Specialists, Inc.
d/b/a Con-Spec, Inc. 1,627,900 (M)(iv)
4.19 Form of Purchase Agreement dated May 13, 1997,
between the Company and Jefferies & Company, Inc. (the
"Initial Purchaser") with respect to 75,000 Units each
consisting of $1,000 principal amount of 13.5% Senior
Secured Notes due May 1, 2004, Series A and one warrant
to purchase 1,280 shares of the Company's Common Stock
with an exercise price of $0.2063 per share ("Note
Warrants"). (N)(i)
4.20 Form of Purchase Agreement dated May 13, 1997,
between the Company and Jefferies & Company, Inc. (the
"Initial Purchaser") with respect to 294,118 Units each
consisting of one share of Amended Series A, Cumulative
Convertible Preferred Stock ("Amended Series A
Preferred Stock") and one warrant to purchase 327
shares of the Company's Common Stock with an exercise
price of $0.2063 per share ("Equity Warrants"). (N)(ii)
4.21 Form of Warrant Agreement and Warrant Certificate
dated May 20, 1997, between the Company and Jefferies &
Company, Inc., as the Initial Purchaser, with respect
to the Note Warrants. (N)(iii)
4.22 Form of Warrant Agreement and Warrant Certificate
dated May 20, 1997, between the Company and Jefferies &
Company, Inc., as the Initial Purchaser, with respect
to the Equity Warrants. (N)(iv)
4.23 Form of Designation of Amended Series A Preferred
Stock dated May 19, 1997. (N)(v)
4.24 Form of Amended Series A Preferred Stock
certificate. (N)(vi)
4.25 Form of Global Unit Certificate for 75,000 Units
consisting of 13.5% Senior Secured Notes due May 1,
2004 and Warrants to Purchase Shares of Common Stock.
(N)(vii)
4.26 Form of Global Unit Certificate for 293,765 Units
consisting of Amended Series A Preferred Stock and
Warrants to Purchase Shares of Common Stock. (N)(viii)
4.27 Form of Warrant Certificate dated May 20, 1997,
issued to Jefferies & Company, Inc., with respect to
12,755 warrants to purchase shares of Common Stock of
the Company at an exercise price of $0.2063 per share.
(N)(ix)
4.28 Form of Stock Purchase Agreement dated effective as
of October 1, 1997, between the Company and William
Wang, whereby the Company issued 800,000 shares of
Common Stock to Mr. Wang, as partial compensation
pursuant to a Consulting Agreement. (O)(i)
4.29 Form of Stock Purchase Warrants dated effective as
of February 20, 1997, issued to Mr. Patrick B. Collins
with respect to 200,000 warrants to purchase shares of
Common Stock of the Company at an exercise price of
$0.25 per share, issued as partial compensation
pursuant to a Consulting Agreement. (O)(ii)
4.30 Certificate of Amendment to the Certificate of
Designation of Series F, Cumulative Convertible
Preferred Stock dated January 6, 1998. (P)(ii)
4.31 Form of Stock Purchase Warrants dated January 16,
1998, issued to Arthur Rosenbloom (6,389), Abby Leigh
(12,600) and Mitch Leigh (134,343) to purchase shares
of Common Stock of the Company at an exercise price of
$0.15 per share, on or before December 31, 2001.
(P)(iii)
4.32 Certificate of Designation of Amended Series B,
Cumulative Convertible Preferred Stock dated March 4,
1998. (P)(iv)
4.33 Correction to Certificate of Designation of Amended
Series B, Cumulative Convertible Preferred Stock dated
March 5, 1998. (P)(v)
4.34 Second Correction to Certificate of Designation of
Amended Series B Preferred Stock dated March 19, 1998.
(P)(vi)
4.35 Form of Stock certificate representing shares of
Amended Series B Preferred Stock. (Q)(ii)
4.36 Form of Agreement dated March 3, 1998 between the
Company and Arbco Associates, L.P., Kayne Anderson Non-
Traditional Investments, L.P., Offense Group
Associates, L.P. and Opportunity Associates, L.P. for
the exchange of Series B Preferred Stock and associated
warrants into Amended Series B Preferred Stock and
warrants. (Q)(iii)
4.37 Form of Stock Purchase Warrants dated March 3, 1998
between the Company and the following entities:
Holder Warrants
Arbco Associates, L.P. 85,107
Kayne Anderson Non-Traditional
Investments, L.P. 79,787
Offense Group Associates, L.P. 61,170
Opportunity Associates, L.P. 23,936 (Q)(iv)
4.38 Form of Stock Purchase Warrant dated effective as
of June 30, 1998, issued to Mr. Patrick B. Collins with
respect to 17,000 warrants to purchase shares of Common
Stock of the Company at an exercise price of $3.75 per
share, issued as partial compensation pursuant to a
Consulting Agreement. (T)(i)
4.39 Form of Warrant Exchange Agreement and Stock
Purchase Warrant dated September 15, 1998 to purchase
an aggregate of 351,015 shares of Common Stock at an
exercise price of $2.50 per share, subject to
adjustment, issued to Cumberland Partners in exchange
for certain warrants held by Cumberland Partners.
(T)(ii)
4.40 Form of Warrant Agreement dated October 1, 1998 to
purchase 50,000 shares of Common Stock at an exercise
price of $3.75 per share, subject to adjustment, issued
to Steven B. Toon, a former officer of the Company.
(U)(i)
4.41 Form of a series of Stock Purchase Warrants dated
November 6, 1998, issued as a part of a unit offered
with secured Notes of XCL Land Ltd., exercisable at
$3.50 per share on or before November 6, 2003,
entitling the following holders to purchase up to an
aggregate of 325,575 shares of Common Stock:
Warrant Holder Warrants
J. Edgar Monroe Foundation 21,705
Estate of J. Edgar Monroe 151,935
Construction Specialists, Inc.
d/b/a Con-Spec, Inc. 151,935 (U)(ii)
4.42 Form of a series of Stock Purchase Warrants issued
as part of a unit offered with Secured Notes of XCL
Land Ltd., entitling the following holders to purchase
shares of Common Stock:
Initial
Warrant Holder Warrants Exercise Price Date
Estate of J. Edgar Monroe 54,262 $2.00 January 15, 1999
Construction Specialists, Inc.
d/b/a Con-Spec, Inc. 54,262 $2.00 January 15, 1999
Doug Ashy 21,705 $1.50 March 22, 1999
Edgar D. Daigle 21,705 $1.50 March 25, 1999
T. Jerald Hanchey 43,410 $1.3125 April 13, 1999
(V)(i)
4.43 Form of Warrant Amendment Agreement between the
Company, J. Edgar Monroe Foundation (1976), Estate of
J. Edgar Monroe, and Construction Specialists, Inc.
d/b/a Con-Spec, Inc. amending the warrant exercise
price of warrants dated November 6, 1998, from $3.50 to
$2.00 per share. (V)(ii)
4.44 Form of a Stock Purchase Warrant dated March 15,
1999 issued to Mr. Robert R. Durkee, Jr. as part of a
unit offering with Secured Notes of XCL Land, Ltd.,
exercisable at $1.25 per share on or before March 15,
2004. (V)(iii)
4.45 Form of a Second Warrant Amendment Agreement
between the Company, J. Edgar Monroe Foundation (1976),
Estate of J. Edgar Monroe, and Construction
Specialists, Inc. d/b/a Con-Spec, Inc. amending the
warrant exercise price of warrants dated November 6,
1998, from $2.00 to $1.50 per share. (V)(iv)
9.0 Not applicable.
10.1 Contract for Petroleum Exploration, Development and
Production on Zhao Dong Block in Bohai Bay Shallow
Water Sea Area of The People's Republic of China
between China National Oil and Gas Exploration and
Development Corporation and XCL-China Ltd., dated
February 10, 1993. (B)
10.2 Form of Net Revenue Interest Assignment dated
February 23, 1994, between the Company and the
purchasers of the Company's Series D, Cumulative
Convertible Preferred Stock. (D)(iv)
10.3 Modification Agreement for Petroleum Contract on
Zhao Dong Block in Bohai Bay Shallow Water Sea Area of
The People's Republic of China dated March 11, 1994,
between the Company, China National Oil and Gas
Exploration and Development Corporation and Apache
China Corporation LDC. (D)(v)
10.4 Consulting agreement between the Company and Sir
Michael Palliser dated April 1, 1994. (F)(i)
10.5 Consulting agreement between the Company and Mr.
Arthur W. Hummel, Jr. dated April 1, 1994. (F)(ii)
10.6 Letter of Intent between the Company and CNPC
United Lube Oil Corporation for a joint venture for the
manufacture and sale of lubricating oil dated January
14, 1995. (G)(i)
10.7 Farmout Agreement dated May 10, 1995, between XCL
China Ltd., a wholly owned subsidiary of the Company
and Apache Corporation whereby Apache will acquire an
additional interest in the Zhao Dong Block, Offshore
People's Republic of China. (G)(ii)
10.8 Contract of Chinese Foreign Joint Venture dated
July 17, 1995, between United Lube Oil Corporation and
XCL China Ltd. for the manufacturing and selling of
lubricating oil and related products. (H)(iv)
10.9 Letter of Intent dated July 17, 1995 between CNPC
United Lube Oil Corporation and XCL Ltd. for discussion
of further projects. (H)(v)
10.10 Copy of Letter Agreement dated March 31, 1995,
between the Company and China National Administration
of Coal Geology for the exploration and development of
coal bed methane in Liao Ling Tiefa and Shanxi Hanchang
Mining Areas. (H)(i)
10.11 Memorandum of Understanding dated December 14,
1995, between XCL Ltd. and China National
Administration of Coal Geology. (I)(iv)
10.12 Copy of Purchase and Sale Agreement dated March 8,
1996, between XCL-Texas, Inc. and Tesoro E&P Company,
L.P. for the sale of the Gonzales Gas Unit located in
south Texas. (I)(v)
10.13 Copy of Limited Waiver between the Company and
Internationale Nederlanden (U.S.) Capital Corporation
dated April 3, 1996. (I)(vi)
10.14 Copy of Purchase and Sale Agreement dated April
22, 1996, between XCL-Texas, Inc. and Dan A. Hughes
Company for the sale of the Lopez Gas Units located in
south Texas. (J)
10.15 Form of Sale of Mineral Servitude dated June 18,
1996, whereby the Company sold its 75 percent mineral
interest in the Phoenix Lake Tract to the Stream Family
Limited Partners and Virginia Martin Carmouche Gayle.
(K)(i)
10.16 Form of Act of Sale between the Company and The
Schumacher Group of Louisiana, Inc. dated March 31,
1997, wherein the Company sold its office building.
(M)(v)
10.17 Amendment No. 1 to the May 1, 1995 Agreement with
Apache Corp. dated April 3, 1997, effective December
13, 1996. (M)(vi)
10.18 Form of Guaranty dated April 9, 1997 by XCL-China
Ltd. in favor of ING (U.S.) Capital Corporation
executed in connection with the sale of certain
Unsecured Notes issued by XCL-China Ltd. (M)(vii)
10.19 Form of First Amendment to Stock Pledge Agreement
dated April 9, 1997, between the Company and ING (U.S.)
Capital Corporation adding XCL Land Ltd. to the Stock
Pledge Agreement dated as of January 31, 1994.
(M)(viii)
10.20 Form of Agreement dated April 9, 1997, between ING
(U.S.) Capital Corporation, XCL-China and holders of
the Senior Unsecured Notes, subordinating the Guaranty
granted by XCL-China in favor of ING to the Unsecured
Notes. (M)(ix)
10.21 Form of Forbearance Agreement dated April 9, 1997
between the Company and ING (U.S.) Capital Corporation.
(M)(x)
10.22 Form of a series of Unsecured Notes dated April
10, 1997, between the Company and the following
entities:
Note Holder Principal Amount
Kayne Anderson Offshore, L.P. $200,000
Offense Group Associates, L.P. $500,000
Kayne Anderson Non-Traditional
Investments, L.P. $500,000
Opportunity Associates, L.P. $400,000
Arbco Associates, L.P. $500,000
J. Edgar Monroe Foundation $100,000
Estate of J. Edgar Monroe $300,000
Boland Machine & Mfg. Co., Inc. $100,000
Construction Specialists, Inc.
d/b/a Con-Spec, Inc. $500,000 (M)(xi)
10.23 Form of Subscription Agreement dated April 10,
1997, by and between XCL-China, Ltd., the Company and
the subscribers of Units, each unit comprised of
$100,000 in Unsecured Notes and 325,580 warrants.
(M)(xii)
10.24 Form of Intercompany Subordination Agreement dated
April 10, 1997, between the Company, XCL-Texas, Ltd.,
XCL Land Ltd., The Exploration Company of Louisiana,
Inc., XCL-Acquisitions, Inc., XCL-China Coal Methane
Ltd., XCL-China LubeOil Ltd., XCL-China Ltd., and
holders of the Unsecured Notes. (M)(xiii)
10.25 Form of Indenture dated as of May 20, 1997,
between the Company, as Issuer and Fleet National Bank,
as Trustee ("Indenture"). (N)(x)
10.26 Form of 13.5% Senior Secured Note due May 1, 2004,
Series A issued May 20, 1997 to Jefferies & Company,
Inc. as the Initial Purchaser (Exhibit A to the
Indenture). (N)(xi)
10.27 Form of Pledge Agreement dated as of May 20, 1997,
between the Company and Fleet National Bank, as Trustee
(Exhibit C to the Indenture). (N)(xii)
10.28 Form of Cash Collateral and Disbursement Agreement
dated as of May 20, 1997, between the Company and Fleet
National Bank, as Trustee and Disbursement Agent, and
Herman J. Schellstede & Associates, Inc., as
Representative (Exhibit F to the Indenture). (N)(xiii)
10.29 Form of Intercreditor Agreement dated as of May
20, 1997, between the Company, ING (U.S.) Capital
Corporation, the holders of the Secured Subordinated
Notes due April 5, 2000 and Fleet National Bank, as
trustee for the holders of the 13.5% Senior Secured
Notes due May 1, 2004 (Exhibit G to the Indenture).
(N)(xiv)
10.30 Registration Rights Agreement dated as of May 20,
1997, by and between the Company and Jefferies &
Company, Inc. with respect to the 13.5% Senior Secured
Notes due May 1, 2004 and 75,000 Common Stock Purchase
Warrants (Exhibit H to the Indenture). (N)(xv)
10.31 Form of Security Agreement, Pledge and Financing
Statement and Perfection Certificate dated as of May
20, 1997, by the Company in favor of Fleet National
Bank, as Trustee (Exhibit I to the Indenture). (N)(xvi)
10.32 Registration Rights Agreement dated as of May 20,
1997, by and between the Company and Jefferies &
Company, Inc. with respect to the 9.5% Amended Series A
Preferred Stock and Common Stock Purchase Warrants.
(N)(xvii)
10.33 Form of Restated Forbearance Agreement dated
effective as of May 20, 1997, between the Company, XCL-
Texas, Inc. and ING (U.S.) Capital Corporation.
(N)(xviii)
10.34 Form of Consulting Agreement dated February 20,
1997, between the Company and Mr. Patrick B. Collins,
whereby Mr. Collins performs certain accounting
advisory services. (O)(ii)
10.35 Form of Consulting Agreement dated effective as of
June 1, 1997, between the Company and Mr. R. Thomas
Fetters, Jr., a director of the Company, whereby Mr.
Fetters performs certain geological consulting
services. (O)(iii)
10.36 Form of Agreement dated October 1, 1997, between
the Company and Mr. William Wang, whereby Mr. Wang
performs certain consulting services with respect to
its investments in China. (O)(iv)
10.37 Form of Services Agreement dated August 1, 1997,
between the Company and Mr. Benjamin B. Blanchet, an
officer of the Company. (O)(v)
10.38 Form of Promissory Note dated August 1, 1997, in a
principal amount of $100,000, made by Mr. Benjamin B.
Blanchet in favor of the Company. (O)(vi)
10.39 Form of Consulting Agreement dated June 15, 1998,
between the Company and Mr. Patrick B. Collins, whereby
Mr. Collins performs certain accounting advisory
services. (T)(iii)
10.40 Amended and Restated Long Term Stock Incentive
Plan effective June 1, 1997. (R)(i)
10.41 Form of Restricted Stock Award Agreement. (T)(iv)
10.42 Form of Nonqualified Stock Option Agreement.
(T)(v)
10.43 Appreciation Option for M. W. Miller, Jr. (R)(ii)
10.44 Zhang Dong Petroleum Sharing Contract. (T)(vi)
10.45 Form of a series of Secured Notes dated November
6, 1998, between the Company and the following
entities:
Note Holder Principal Amount
J. Edgar Monroe Foundation $100,000
Estate of J. Edgar Monroe $700,000
Construction Specialists, Inc.
d/b/a Con-Spec, Inc. $700,000 (U)(iii)
10.46 Form of Subscription Agreement dated November 6,
1998, by and between XCL Land, Ltd., the Company and
the subscribers of Units, each unit comprised of
$100,000 in secured Notes and 21,705 warrants. (U)(iv)
10.47 Form of Security Agreement dated November 6, 1998,
by and between XCL Land, Ltd. and holders of the
secured Notes of XCL Land, Ltd. dated November 6, 1998.
(U)(v)
10.48 Form of Security Agreement dated November 6, 1998,
by and between The Exploration Company of Louisiana,
Inc. and holders of the secured Notes of XCL Land, Ltd.
dated November 6, 1998. (U)(vi)
10.49 Form of Subscription Agreement by and between XCL
Land, Ltd., the Company and the subscribers of Units,
each unit comprised of $100,000 in Secured Notes and
21,705 warrants. (V)(v)
Subscriber Units Date
Estate of J. Edgar Monroe 2.5 January 15, 1999
Construction Specialists, Inc.
d/b/a Con-Spec, Inc. 2.5 January 15, 1999
Doug Ashy, Sr. 1.0 March 22, 1999
Edgar D. Daigle 1.0 March 25, 1999
T. Jerald Hanchey 2.0 April 13, 1999
10.50 Form of a series of secured Notes between the
Company and the following entities:
Note Holder Principal Amount Issue Date
Estate of J. Edgar Monroe $250,000 January 15, 1999
Construction Specialists, Inc.
d/b/a Con-Spec, Inc. $250,000 January 15, 1999
Doug Ashy, Sr. $100,000 March 22, 1999
Edgar D. Daigle $100,000 March 25, 1999
T. Jerald Hanchey $200,000 April 13, 1999 (V)(vi)
10.51 Form of First Amendment to Security Agreement
dated January 15, 1999, by and between XCL Land, Ltd.
and holders of the Secured Notes of XCL Land, Ltd.
dated November 6, 1999. (V)(vii)
10.52 Form of First Amendment to Security Agreement
dated January 15, 1999, by and between The Exploration
Company of Louisiana, Inc. and holders of the secured
Notes of XCL Land, Ltd. dated November 6, 1998.
(V)(viii)
10.53 Acknowledgement and Agreement Regarding Security
Interest by the J. Edgar Monroe Foundation (1976) dated
January 15, 1999. (V)(ix)
10.54 Form of Security Agreement by and between XCL
Land, Ltd. and the following holders of the Secured
Notes of XCL Land, Ltd.:
Note Holder Date
Doug Ashy, Sr. March 22, 1999
Edgar D. Daigle March 25, 1999 (V)(x)
10.55 Form of Security Agreement by and between The
Exploration Company of Louisiana, Inc. and the
following holders of the Secured Notes of XCL Land,
Ltd.
Note Holder Date
Doug Ashy, Sr. March 22, 1999
Edgar D. Daigle March 25, 1999 (V)(xi)
10.56 Form of Subscription Agreement dated March 15,
1999, by and between XCL Land, Ltd. and Robert R.
Durkee, Jr. for a unit comprised of a $100,000 45-day
secured note and 10,000 warrants to purchase Common
Stock of XCL Ltd.. (V)(xii)
10.57 Form of Promissory Note dated March 15, 1999, by
and between Robert R. Durkee, Jr. in the principal
amount of $100,000. (V)(xiii)
10.58 Form of Security Agreement by and between XCL
Land, Ltd. and Robert R. Durkee, Jr. dated March 15,
1999. (V)(xiv)
10.59 Form of Security Agreement by and between The
Exploration Company of Louisiana, Inc. and Robert R.
Durkee, Jr. dated March 15, 1999. (V)(xv)
10.60 Consulting Agreement dated January 1, 1999,
between the Company and R. Thomas Fetters, Jr., a
director of the Company, whereby Mr. Fetters performs
certain geological consulting services. (V)(xvi)
10.61 Amendment to Personal Services Agreement dated
January 15, 1999, between the Company and Benjamin B.
Blanchet, an officer and director of the Company.
(V)(xvii)
11.0 Not applicable.
15.0 Not applicable.
18.0 Not applicable.
19.0 Not applicable.
22.0 Not applicable.
23.0 Not applicable.
24.0 Not applicable.
27.0 Financial Data Schedule *
99.0 Glossary of Terms
_________________________
*Filed herewith.
(A) Incorporated by reference to the Registration
Statement on Form 8-B filed on July 28, 1988, where it
appears as Exhibits 3(c).
(B) Incorporated by reference to a Registration
Statement on Form S-3 (File No. 33-68552) where it
appears as Exhibit 10.1.
(C) Incorporated by reference to Post-Effective
Amendment No. 2 to Registration Statement on Form S-3
(File No. 33-68552) where it appears as: (i) Exhibit
4.29; (ii) Exhibit 4.30; and (iii) through (v) Exhibits
4.34 through 4.36, respectively.
(D) Incorporated by reference to Amendment No. 1 to
Annual Report on Form 10-K filed April 15, 1994, where
it appears as: (i) Exhibit 4.32; (ii) Exhibit 4.36;
(iii) Exhibit 4.37; (iv) through (v) Exhibit 10.41
through Exhibit 10.47, respectively; and (v) Exhibit
10.49.
(E) Incorporated by reference to an Annual Report on
Form 10-K for the fiscal year ended December 31, 1990,
filed April 1, 1991, where it appears as Exhibit 10.27.
(F) Incorporated by reference to Amendment No. 1 to an
Annual Report on Form 10-K/A No. 1 for the fiscal year
ended December 31, 1994, filed April 17, 1995, where it
appears as: (i) through (ii) Exhibits 10.22 through
10.23, respectively.
(G) Incorporated by reference to Quarterly Report on
Form 10-Q for the quarter ended March 31, 1995, filed
May 15, 1995, where it appears as: (i) Exhibit 10.26;
and (ii) Exhibit 10.28.
(H) Incorporated by reference to Quarterly Report on
Form 10-Q for the quarter ended September 30, 1995,
filed November 13, 1995, where it appears as Exhibit
10.35.
(I) Incorporated by reference to Annual Report on Form
10-K for the year ended December 31, 1995, filed April
15, 1996, where it appears as: (i) through (iii)
Exhibits 4.28 through 4.30, respectively; and (iv)
Exhibit 10.31; (v) Exhibit 10.32 and (vi) Exhibit
10.36.
(J) Incorporated by reference to Quarterly Report on
Form 10-Q for the quarter ended March 31, 1996, filed
May 15, 1996, where it appears as Exhibit 10.37.
(K) Incorporated by reference to Quarterly Report on
Form 10-Q for the quarter ended June 30, 1996, filed
August 14, 1996, where it appears as Exhibit 10.38.
(L) Incorporated by reference to Quarterly Report on
Form 10-Q for the quarter ended September 30, 1996,
filed November 14, 1996, where it appears as Exhibits
4.32.
(M) Incorporated by reference to Annual Report on Form
10-K for the year ended December 31, 1996, filed April
15, 1997, where it appears as (i) through (iii)
Exhibits 4.35 through 4.38; (iv) Exhibit 4.40; and (v)
through (xiii) Exhibits 10.42 through 10.50.
(N) Incorporated by reference to Current Report on Form
8-K dated May 20, 1997, filed June 3, 1997, where it
appears as (i) through (ix) Exhibits 4.1 through 4.9
and (x) through (xviii) Exhibits 10.51 through 10.59.
(O) Incorporated by reference to Quarterly Report on
Form 10-Q for the quarter ended September 30, 1997,
filed November 14, 1997, where it appears as (i)
Exhibit 4.52; and (ii) through (vi) Exhibits 10.62
through 10.66.
(P) Incorporated by reference to Annual Report on Form
10-K for the year ended December 31, 1997, filed April
15, 1998, where it appears as (i) Exhibit 4.1; (ii)
through (vi) Exhibits 4.32 through 4.36, respectively.
(Q) Incorporated by reference to Amendment No. 1 to
Annual Report on Form 10-K for the year ended December
31, 1997, filed April 22, 1998, where it appears as (i)
Exhibit 3.1; and (ii) through (iv) Exhibits 4.37
through 4.39, respectively.
(R) Incorporated by reference to Proxy Statement dated
November 20, 1997 filed November 6, 1997, where it
appears as (i) Appendix C; and (ii) Appendix D,
respectively.
(S) Incorporated by reference to Registration Statement
on Form S-1 filed May 6, 1998, where it appears as
Exhibit 24.1.
(T) Incorporated by reference to Amendment No. 2 to
Registration Statement on Form S-1 filed October 23,
1998, where it appears as: (i) Exhibit 4.40; (ii)
Exhibit 4.41; (iii) Exhibit 10.49; (iv) Exhibit 10.50;
(v) Exhibit 10.51; and (vi) Exhibit 10.54.
(U) Incorporated by reference to Quarterly Report on
Form 10-Q for the quarter ended September 30, 1998,
filed on November 16, 1998, where it appears as: (i)
and (ii) Exhibits 4.42 and 4.43, respectively; and
(iii) through (vi) Exhibits 10.55 through 10.58,
respectively.
(V) Incorporated by reference to Annual Report on Form
10-K for the year ended December 31, 1998, filed on
April 15, 1999, where it appears as: (i) through (iv)
Exhibits 4.42 to 4.45; and (v) through (xvii) Exhibits
10.49 through 10.61.