As filed with the Securities and Exchange Commission on May 17, 2002
Registration No. 333____________
Securities and Exchange Commission
Washington, D.C. 20549
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FORM S-3
Registration Statement
Under the Securities Act of 1933
U.S. ENERGY CORP.
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(Exact name of registrant as specified in its charter)
Wyoming
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(State or other jurisdiction of incorporation or organization)
83-0205516
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(I.R.S. Employer Identification No.)
877 North 8th West, Riverton, Wyoming 82501; Tel. 307.856.9271
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(Address, including zip code, and telephone number, including area code,
of issuer's principal executive offices)
Daniel P. Svilar, 877 North 8th West
Riverton, WY 82501; Tel. 307.856.9271
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(Name, address, including zip code, and telephone number of agent for service)
Copies to: Stephen E. Rounds, Esq.
The Law Office of Stephen E. Rounds
4635 East 18th Ave., Denver, CO 80220
Tel: 303.377.6997; Fax: 303.377.0231
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Approximate date of commencement and end of proposed sale to the public: From
time to time after the registration statement becomes effective.
If the only securities being registered on this Form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box. [ ]
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X ]
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. [ ]
CALCULATION OF REGISTRATION FEE
Proposed
Proposed Maximum
Amount of Maximum Aggregate
Title of Each Class Securities Offering Dollar Price Amount
of Securities to be Registered Price Per of Securities to of
to be Registered in the Offering Security be Registered(1) Fee
- ---------------- --------------- -------- ---------------- ----------------
Common Stock 281,926 $3.75 $ 1,057,222.50 $ 97.27
Shares(2)
Common Stock 56,383 $4.00 $ 225,532.00 $ 20.75
Shares(3)
Common Stock 20,000 $3.75 $ 75,000.00 $ 6.90
Shares(2)
Total No. Securities
to be Registered 358,309 $ 1,378,889.32 $ 126.86
Shares
(1) Under rule 457(c), registration fee calculations are estimated based on the
market value of the registrant's common stock (Nasdaq National Market
System price on May 13, 2002), which is within 5 business days prior to the
initial filing of this statement.
(2) These shares are issued and outstanding, and are being registered for
resale under this registration statement.
(3) These shares being registered for resale under this registration statement
are issuable on exercise of outstanding warrants, at $4.00 per share, which
warrants were purchased by 16 investors in February and March 2002. These
warrants expire two years from the date of investment.
DELAYING AMENDMENT UNDER RULE 473(A): 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 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 section 8(a), may determine.
The information in this prospectus is subject to completion or amendment. The
securities covered by this prospectus cannot be sold until the registration
statement filed with the Securities and Exchange Commission becomes effective.
This prospectus shall not constitute an offer to sell or the solicitation of an
offer to buy nor shall there be any sale of these securities in any state in
which an offer, solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of that state.
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U.S. ENERGY CORP.
358,309 SHARES OF COMMON STOCK
This prospectus covers the offer and sale of up to 358,309 shares of common
stock ($0.01 par value) by the shareholders and by holders of warrants on
exercise of warrants. The shares are offered for sale by the selling
shareholders:
o 281,926 shares held by 16 investors.
o 56,383 shares on exercise of warrants held by 16 investors, at $4.00
per share. These warrants expire two years from the original dates of
investment which were various dates in February and March 2002.
o 20,000 shares held by Robert H. Taggart Jr.
In this prospectus, "selling shareholder" or "selling shareholders" refer
to the 16 private placement investors holding 281,926 shares, and warrants to
purchase an additional 56,383 shares, and to Robert H. Taggart, Jr., who holds
20,000 shares. The selling shareholders are identified under "Selling
Shareholders." In this prospectus, and the information incorporated by
reference; "we," "company," and "USE" refer to U.S. Energy Corp. (and its
subsidiaries unless otherwise specifically stated).
The selling shareholders may sell the shares from time to time in
negotiated transactions, brokers' transactions or a combination of such methods
of sale at market prices prevailing at the time of sale or at negotiated prices.
Although we will receive proceeds if and to the extent the warrants are
exercised, we will not receive any proceeds from sale of any of the shares
offered by the selling shareholders. None of the warrants have been exercised at
prospectus date.
USE is traded ("USEG") on the Nasdaq National Market System ($3.75 on May
13, 2002).
AN INVESTMENT IN THE SHARES OFFERED BY THIS PROSPECTUS IS SPECULATIVE AND
SUBJECT TO RISK OF LOSS. SEE "RISK FACTORS" BEGINNING ON PAGE AND THE TABLE OF
CONTENTS ON PAGE .
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
THE DATE OF THIS PROSPECTUS IS MAY ____, 2002.
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TABLE OF CONTENTS
PAGE NO.
Summary Information............................................................5
The Company...............................................................5
The Offering..............................................................6
Risk Factors ..................................................................2
Risk Factors Involving the Company........................................7
Lack of Coalbed Methane Production and Established
Reserves for Coalbed Methane Properties May Slow Down
Development of These Properties.........................................7
We may have to begin to curtain operations if we don't
raise more capital in July or August, 2002..............................7
We Are Subject to Certain Kinds of Risks Which
Are Unique to the Minerals Business.....................................7
Delays in Obtaining Permits for Methane
Wells Could Impair Our Business.........................................8
The Company's Poison Pill Could Discourage
Some Advantageous Transactions..........................................8
Compliance with Environmental Regulations May Be Costly.................8
Commodity Price Fluctuations May Be Difficult
to Manage and Could Cause Losses........................................8
Future Equity Transactions, Including Exercise of
Options or Warrants, Could Result in Dilution...........................8
Terms of Subsequent Financings May
Adversely Impact Your Investment........................................9
Risk Factor Involving This Offering.......................................9
Representations About This Offering............................................9
Forward Looking Statements.....................................................9
Description of Securities.....................................................10
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Use of Proceeds...............................................................13
Selling Shareholders..........................................................13
Plan of Distribution..........................................................15
Disclosure of Commission Position on Indemnification..........................17
Where to Find More Information About Us.......................................17
Incorporation of Certain Information by Reference.............................18
Legal Matters.................................................................19
Experts.......................................................................19
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SUMMARY INFORMATION
The following summarizes all material information found elsewhere in this
prospectus and the information incorporated into it by reference. This summary
is qualified by the more detailed information in this prospectus and the
information incorporated by reference.
THE COMPANY
U.S. Energy Corp. is a Wyoming corporation, formed in 1966, in the business
of acquiring, exploring, developing and/or selling or leasing mineral
properties, and the mining and marketing of minerals. We now are engaged in
three principal mineral sectors: coalbed methane gas, uranium, and gold
(properties and other assets included in the uranium and gold sectors currently
are in care and maintenance status). The most significant uranium properties are
located on Sheep Mountain in Wyoming, and in southeast Utah. We also hold a
royalty interest in claims on Green Mountain, Wyoming, now held by Kennecott
Uranium Company (see below). The gold property is located in Sutter Creek,
California, east of Sacramento. Interests are held in other mineral properties
(principally molybdenum), but are either non-operating interests or undeveloped
claims. Small oil and gas operations in Montana and Wyoming are conducted as
well. Other business segments are commercial (real estate and general aviation)
and construction operations. Our fiscal year ends May 31.
The coalbed methane gas business is conducted through Rocky Mountain Gas,
Inc. RMG, a Wyoming corporation is owned 49.3% by USE and 40.6% by Crested Corp.
Crested is a 70.5% majority-owned subsidiary of the company, see below.
Properties of RMG are held in southeastern Montana and north-eastern and
southwestern Wyoming.
USE and Crested originally were independent companies, with two common
affiliates (John L. Larsen and Max T. Evans). In 1980, USE and Crested formed a
joint venture, referred to as the USECC Joint Venture, to do business together
(unless one or the other elected not to pursue an individual project). As a
result of USE funding certain of Crested's obligations from time to time (due to
Crested's lack of cash on hand), and later payment of debts by Crested issuing
common stock to USE, Crested became a majority-owned subsidiary of USE in fiscal
1993. In fiscal 2001, Crested issued another 6,666,666 shares of common stock to
reduce Crested's debt owed to USE by $3.0 million, which increased USE's
ownership of Crested to 70.5%.
All of USE's (and Crested's) operations are in the United States. Principal
executive offices for USE are located in the Glen L. Larsen building at 877
North 8th Street West, Riverton, Wyoming 82501, telephone 307.856.9271; fax
307.857.3050.
Most of the company's (USE's) operations are conducted through
subsidiaries, the USECC joint venture with Crested, and various jointly-owned
subsidiaries of USE and Crested.
Until September 11, 2000, USE and Kennecott Uranium Company ("Kennecott"),
owned the Green Mountain Mining Venture ("GMMV"), which held a large uranium
deposit and uranium mill in Wyoming. On September 11, 2000, USE and Crested
settled litigation with Kennecott involving the GMMV by selling their interest
in the GMMV and its properties back to Kennecott for $3.25 million and receiving
a royalty interest in the uranium properties. Kennecott also assumed all
reclamation obligations on the GMMV properties. Other principal uranium
properties and an uranium mill in southeast Utah are held by Plateau Resources
Ltd., a wholly-owned subsidiary of USE. The Utah uranium properties are also
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in a care and maintenance status. At some future date, if the uranium oxide
market improves, USE and Crested may consolidate their remaining uranium assets
into a single subsidiary and finance the startup of its mines and mill
operations, subject to obtaining the necessary debt or equity funding. There are
no current plans to implement this strategy at the present time.
The gold assets held by Sutter Gold Mining Company ("SGMC"), a
majority-owned subsidiary of USE, are also in a care and maintenance status
because the current price of gold is too low to raise the capital necessary to
put the properties into production.
THE OFFERING
Securities Outstanding 11,941,252 shares of common stock, $0.01 par
value.
Securities To Be Outstanding 11,997,635 shares of common stock, $0.01 par
value, assuming the 56,383 warrants held by
the selling shareholders were exercised as of
the date of this prospectus.
Securities Offered 358,309 shares of common stock owned or to be
owned by the selling shareholders.
Use of Proceeds We will not receive any proceeds from sale of
shares by the selling shareholders.
Plan of Distribution The offering is made by the selling
shareholders named in this prospectus, to the
extent they sells shares. Sales may be made in
the open market or in private negotiated
transactions, at fixed or negotiated prices.
See "Plan of Distribution."
Risk Factors An investment is subject to risk. See "Risk
Factors."
RISK FACTORS
An investment in our common stock is speculative in nature and involves a
high degree of risk. You should carefully consider the following risks and the
other information in this prospectus (including the information incorporated by
reference) before investing.
6
RISK FACTORS INVOLVING THE COMPANY
LACK OF COALBED METHANE PRODUCTION AND ESTABLISHED RESERVES FOR COALBED
METHANE PROPERTIES MAY SLOW DOWN DEVELOPMENT OF THESE PROPERTIES. Presently we
do not have any wells in production, and we have not drilled and tested enough
wells on our properties to determine if we have economic reserves of coalbed
methane in place. For some properties, we will have to establish at least some
reserve parameters before gas transmission companies will build gas lines to our
properties, and construction of lines will depend also on then-current and
projected market prices for gas. If we have the necessary capital, we may elect
to build our own lines over to existing transmission lines near two of our
properties in the Powder River Basin in Wyoming. We can't sell production until
the lines and associated gathering lines and compression stations are
constructed.
Due to permitting delays in Montana, we may not realize production from the
Castle Rock and Kirby prospects until late 2002 or early 2003. Other properties
located in Wyoming could be in production in mid-2002 to late-2002, but
production might be delayed due to market prices for gas.
These factors may make it difficult to raise the amount of capital needed
to develop the coalbed methane production potential in our properties in a rapid
manner. Therefore we may have to seek to raise capital. In the meantime, we have
only limited working capital. See below.
WE MAY HAE TO BEGIN TO CURTAIL OPERATIONS IF WE DON'T RAISE MORE CAPITAL IN
JULY OR AUGUST, 2002. February 28, 2002, U.S. Energy Corp. had working capital
of $1,979,200, and an accumulated deficit of $33,435,700. Our current level of
operations, including general and administrative overhead, mineral operations
(primarily care and custody costs for the uranium and gold properties), and
costs to comply with other property lease and permitting obligations for the
coalbed properties, are estimated to cost $2,300,000 for the six months ending
October 31, 2002. However, if we can't realize cash from liquidating assets, or
other sources, or if RMG spends more money on exploration than will be covered
by current arrangements, then under these circumstances additional equity
financing may be necessary to sustain operations starting in July or August
2002. There are no current commitments for such future financing as may be
necessary.
Our strategy for RMG contemplates a total capital budget of up to
$50,000,000 through calendar 2003 to develop our coalbed methane properties and
put them into production, and to acquire more properties. The cash requirements
for our coalbed methane business are in addition to working capital
requirements. However, lack of production and established reserves may make it
difficult to raise this amount of money in the near future. Therefore, we may
have to seek to raise capital in smaller amounts over time, which efforts
probably will extend well into calendar 2004. See the preceding risk factor.
WE ARE SUBJECT TO CERTAIN KINDS OF RISK WHICH ARE UNIQUE TO THE MINERALS
BUSINESS. The exploration for and production of minerals is highly speculative
and involves risks different from and in some instances greater than risks
encountered by companies in other industries. Many exploration programs do not
result in the discovery of mineralization and any mineralization discovered may
not be of sufficient quantity or quality. Also, the mere discovery of promising
mineralization may not warrant production, because the minerals (including
methane gas) may be difficult or impossible to extract (produce) on a profitable
basis.
Profitability of any mining and production we may conduct will involve a
number of factors, including, but not limited to: the ability to obtain all
required permits; costs of bringing the property into
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production, including the construction of adequate production facilities; the
availability and costs of financing; keeping ongoing costs of production at
economic levels; and market prices for the metals or hydrocarbons to be produced
staying above production costs. Our properties, or properties we might acquire
in the future, may not contain deposits of minerals or coalbed methane gas that
will be profitable to produce.
In addition, all forms of mineral (and oil and gas and coalbed methane)
exploration and production require permits to have been issued by various
federal and state agencies. See below.
DELAYS IN OBTAINING PERMITS FOR METHANE WELLS COULD IMPAIR OUR BUSINESS.
Drilling and producing coalbed methane wells requires obtaining permits from
various governmental agencies. The ease of obtaining the necessary permits
depends on the type of mineral ownership and the state in which the property is
located. Intermittent delays in the permitting process can reasonably be
expected throughout the development of any play. For example, there is currently
a temporary moratorium for drilling coalbed methane wells on fee and state lands
in Montana. We may shift our exploration and development strategy as needed to
accommodate the permitting process. As with all governmental permit processes,
permits may not be issued in a timely fashion or in a form consistent with our
plan of operations.
THE COMPANY'S POISON PILL COULD DISCOURAGE SOME ADVANTAGEOUS TRANSACTIONS.
We have adopted a shareholder rights plan, also known as a poison pill (see
"Description of Securities"). The plan is designed to discourage a takeover of
the company at an unfair low price. However, it is possible that the board of
directors and the takeover acquiror would not agree on a higher price, in which
case the takeover might be abandoned, even though the takeover price was at a
significant premium to market prices. Therefore, as a result of the mere
existence of the plan, shareholders would not receive the premium price.
COMPLIANCE WITH ENVIRONMENTAL REGULATIONS MAY BE COSTLY. Our minerals
business (mostly uranium, gold, and coalbed methane) is intensely regulated by
government agencies. Permits are required to drill and pump methane wells,
explore for minerals, operate mines, build and operate processing plants, and
handle and store waste. The regulations under which permits are issued change
from time to time to reflect changes in public policy or scientific
understanding of issues. If the economics of a project would not justify the
changes, we might have to abandon the project.
COMMODITY PRICE FLUCTUATIONS MAY BE DIFFICULT TO MANAGE AND COULD CAUSE
LOSSES. Gold, uranium and gas prices can be volatile. Sharp swings in market
prices make budgeting and operations more difficult. Sustained lower prices can
result in impairment of the financial value of the mineral property purchased as
well as the facilities built to process the material (such as mills or gas
compression stations). Hedging activities, if available for the commodity, can
protect against price swings but may result in locking a company into a lower
than market price over time.
FUTURE EQUITY TRANSACTIONS, INCLUDING EXERCISE OF OPTIONS OR WARRANTS,
COULD RESULT IN DILUTION. From time to time the company sells restricted stock
and warrants to investors in private placements conducted by broker-dealers, or
in negotiated transactions. Because the stock is restricted, the stock is sold
at a greater discount to market prices compared to a public stock offering, and
the exercise price of the warrants sometimes is at or even lower than market
prices. These transactions cause dilution to existing shareholders. Also, from
time to time, options are issued to employees and third parties, with exercise
prices equal to market. Exercise of in-the-money options and warrants will
result in dilution to
8
existing shareholders; the amount of dilution will depend on the spread between
market and exercise price, and the number of shares involved. The company will
continue to grant options to employees with exercise prices equal to market
price at grant date, and in the future may sell restricted stock and warrants,
all of which may result in dilution to existing shareholders. See also
"Registration for Resale of Additional Shares May Depress Market Prices."
TERMS OF SUBSEQUENT FINANCINGS MAY ADVERSELY IMPACT YOUR INVESTMENT. We may
have to raise equity, debt or preferred stock financing in the future. Your
rights and the value of your investment in the common stock could be reduced.
For example, if we have to issue secured debt securities, the holders of the
debt would have a claim to our assets that would be prior to the rights of
stockholders until the debt is paid. Interest on these debt securities would
increase costs and negatively impact operating results. Preferred stock could be
issued in series from time to time with such designations, rights, preferences,
and limitations as needed to raise capital. The terms of preferred stock could
be more advantageous to those investors than to the holders of common stock. In
addition, if we need to raise more equity capital from sale of common stock,
institutional or other investors may negotiate terms at least and possibly more
favorable than the terms of this offering. Shares of common stock which we sell
could be sold into the market, which could adversely affect market price. See
below.
RISK FACTOR INVOLVING THIS OFFERING
ADDITIONAL SHARES TO MARKET BY REGISTRATION OR EXCHANGE. From time to time
we have funded operations by selling restricted securities of subsidiary
companies for their operations, then later reacquired those securities by
exchange for shares and warrants of USE. For example, in January 2002, we issued
1,423,460 restricted shares of common stock in exchange for restricted shares of
Rocky Mountain Gas, inc. and in conversion of preferred stock of USE, for which
the exchanging shareholders, and the holder of the USE preferred stock,
originally had invested $5,309,000. The shares of common stock of USE were
issued based on the market price of $3.92 on December 5, 2001, and the original
investment amount for RMG and preferred stock, plus $270,959 of interest owed
three of the investors. These shares have been registered for resale under the
Securities Act of 1933.
From time to time, we may sell restricted shares to raise capital.
Registration for resale of such additional shares could adversely affect market
prices for investors who buy shares in this offering.
REPRESENTATIONS ABOUT THIS OFFERING
We have not authorized anyone to provide you with information different
from that contained in this prospectus. This prospectus is not an offer to sell
nor does it seek an offer to buy the shares in any jurisdiction where this offer
or sale is not permitted. The information contained in this prospectus is
accurate only as of the date of this prospectus (or any supplement), regardless
of when it is delivered or when any shares are sold.
FORWARD LOOKING STATEMENTS
We make statements in this prospectus which are considered to be "forward
looking" statements. All statements (other than statements of historical fact)
about financial and business strategy and the performance objectives of
management are forward-looking statements. These forward-looking statements are
based on the beliefs of management, as well as assumptions made by and
information currently available to them. These statements involve risks that are
both known and unknown, including
9
unexpected economic and market factors, failure to accurately forecast operating
and capital expenditures and capital needs (due to rising costs and/or different
drilling and production conditions in the field), changes in timing or
conditions for getting regulatory approvals to drill coalbed methane wells where
needed, and other business factors. The use of the words "anticipate,"
"believe," "estimate," "expect," "may," "will," "should," "continue," "intend"
and similar words or phrases, are intended by us to identify forward-looking
statements (also known as "cautionary statements" because you should be cautious
in evaluating such statements in the context of all the information in this
prospectus and the information incorporated by reference into this prospectus).
These statements reflect our current views with respect to future events. They
are subject to the realization in fact of assumptions, but what we now think
will happen may be turn out much different, and our assumptions may prove to
have been inaccurate or incomplete.
The investment risks discussed under "Risk Factors" specifically address
all of the material risk factors that may influence future operating results and
financial performance. Those investment risks are not "boiler plate" but are
intended to tell you about the uncertainties and risks inherent in our business
at the present time which you need to evaluate before making your investment
decision.
DESCRIPTION OF SECURITIES
COMMON STOCK. We are authorized by our articles of incorporation to issue
an unlimited number of shares of common stock, $0.01 par value, and 100,000
shares of preferred stock, $0.01 par value.
Shares of common stock may be issued for such consideration and on such
terms as determined by the board of directors, without shareholder approval.
Holders are entitled to receive dividends when and as declared by the board of
directors out of funds legally available therefor. There are no restrictions on
payment of cash dividends. Cash dividends have not been declared on the common
stock, although a 1 for 10 stock dividend was declared in November 1990. It is
anticipated that future earnings would be reinvested into operations and not
declared as dividends on the common stock. All holders of shares of common stock
have equal voting rights, and the shares of common stock sold in this offering
will have the same rights. Holders of shares of common stock are entitled to one
vote per share on all matters upon which such holders are entitled to vote, and
further have the right to cumulate their votes in elections of directors.
Cumulation means multiplying the number of shares held, by the number of
nominees to the board of directors, then voting the product among the nominees
as desired. Directors are elected by a plurality of the votes cast.
Shares of common stock sold in this offering are fully-paid and
nonassessable shares of U.S. Energy Corp.
Pursuant to our articles of incorporation and as permitted by Wyoming law,
shares of common stock held by our subsidiaries may be voted by such
subsidiaries as determined by the board of directors of each, in elections of
directors and other matters brought before shareholders.
In September 2001, the company adopted a shareholder rights plan ("poison
pill") and filed the plan with the Securities and Exchange Commission as an
exhibit to Form 8-A. The following three paragraphs briefly state principal
features of the plan, which are qualified by reference to the complete plan,
which is incorporated by reference into this prospectus.
10
Under the plan, the holder of each share of common stock has the right to
purchase (when the rights become exercisable) from the company one-one
thousandth (1/1,000th) of one (1) share of Series P preferred stock at price of
$200.00 per for each one-one thousandth (1/1,000th) share of such preferred
stock. The purpose of the plan is to deter an unfairly low priced hostile
takeover of the company, by encouraging a hostile party to negotiate a fair
offer with the board of directors and thus eliminate the poison pill.
The rights trade with the common stock and aren't separable therefrom; no
separate certificate for the rights is issued unless and until there is a
hostile takeover attempted, after which time separate and tradable rights
certificates would be issued.
The rights are not exercisable and never can be unless and until a hostile
(not negotiated with the board) takeover of the company is initiated with the
objective of acquiring 15% of the company's voting stock. If before the takeover
is launched the hostile party comes to agreement with the board of directors
about price and terms and makes a "qualified offer" to buy the stock of the
company, then the board of directors may redeem (buy back) the rights for $0.01
each. But, if such a "qualified offer" isn't agreed upon, then the rights are
exercisable for preferred stock, which in turn would enable to holder to convert
the preferred stock into voting common stock of the company at a price equal to
one-half the market price.
PREFERRED STOCK. Shares of preferred stock may be issued by the board of
directors with such dividend, liquidation, voting and conversion features as may
be determined by the board of directors without shareholder approval. In June
2000, we established a Series A Convertible Preferred Stock, for which 1,000
shares of preferred stock are reserved for sale at $10,000 per share; 200 shares
were issued and outstanding at November 30, 2001. In January 2002, we converted
the 200 outstanding shares of Series A stock by issuing 513,140 shares of
restricted common stock to the holder, based on $2,000,000 invested plus $11,507
of interest (annual rate of 7.5%) which accrued in December 2001 (previous
interest had been paid in cash), divided by $3.92 (market price for USE stock on
December 5, 2001).
WARRANTS. As of the date of this prospectus, warrants and options (to
persons or entities other than employees, officers or directors of the company)
are issued and outstanding to purchase a total of 389,958 shares of common
stock:
o Warrants to purchase 10,000 shares at $3.75 held by Kevin P. Daly, issued
as of October 18, 2001 and expiring October 18, 2003. Resale of shares acquired
on exercise of these warrants is covered by a prospectus filed pursuant to Rule
424(b)(2).
o Warrants to purchase 50,000 shares at $3.00 held by CAYDAL, LLC, issued
on October 24, 2001 and expiring October 24, 2003. Resale of shares acquired on
exercise of these warrants is covered by a prospectus filed pursuant to Rule
424(b)(2).
o Warrants to purchase 60,322 shares at $3.75 held by 18 investors who
purchased shares and warrants in private transactions with the company from June
29, 2001 to October 18, 2001. These warrants were issued as of October 18, 2001
and expire October 18, 2003. Resale of shares acquired on exercise of these
warrants is covered by a prospectus filed pursuant to Rule 424(b)(2).
o Warrants to purchase 38,966 shares at $3.75 held by persons associated
with VentureRound Group LLC, which served as the Financial Advisor to the
company in connection with the private transactions from June to October 2001
(see above). These warrants were issued as partial compensation
11
for services provided to the company by the Financial Advisor. These warrants
were issued as of October 18, 2001 and expire October 18, 2006. Resale of shares
acquired on exercise of these warrants is covered by a prospectus filed pursuant
to Rule 424(b)(2).
o Warrants to purchase 11,034 shares at $3.75 held by members of
VentureRound Group LLC. These warrants were issued for financial consulting
services provided by VentureRound Group LLC. These warrants were issued as of
November 2, 2001 and expire November 2, 2006. Resale of shares acquired on
exercise of these warrants is covered by a prospectus filed pursuant to Rule
424(b)(2).
o Warrants to purchase 60,322 shares at $3.64, issued in exchange for
Yellow Stone Fuels Corporation (a subsidiary of USE) warrants under a share
exchange agreement between YSFC and USE. The warrants expire September 18, 2002.
The shares acquired on exercise of these warrants are not restricted for resale,
as they are covered under a previously filed registration statement.
o Options to purchase 75,000 shares at $2.25 per share (expiring February
8, 2004), issued to consultant Michael Baybak. Resale of the shares acquired on
exercise of these options is not covered by a resale prospectus.
o Options to purchase 20,000 shares at $2.62 per share (expiring June 15,
2002), issued to consultant R. J. Falkner. Resale of the shares acquired on
exercise of these options is covered by a prospectus filed pursuant to Rule
424(b)(2).
o Warrants to purchase 10,000 shares at $4.70 per share (expiring May 14,
2003), issued to consultant Riches in Resources, Inc. The warrants are not
exercisable unless the company's stock price closes at or above $6.50 per share
for 90 consecutive days before expiration of the options. Resale of the shares
acquired on exercise of these options is covered by a prospectus filed pursuant
to Rule 424(b)(2).
o Warrants to purchase 20,000 shares at $4.70 per share (expiring May 14,
2003), issued to consultant Riches in Resources, Inc. The warrants are not
exercisable until the company's stock price closes at or above $10.00 per share
for 90 consecutive days. Resale of the shares acquired on exercise of these
options is covered by a prospectus filed pursuant to Rule 424(b)(2).
o Options to purchase 20,000 shares at $3.98 per share, expiring April 10,
2006, issued to consultant R. J. Falkner and Company. Resale of the shares
acquired on exercise of these options is covered by a prospectus filed pursuant
to Rule 424(b)(2).
o Warrants to purchase 56,383 shares at $4.00 per share, held by 16
investors who purchased shares and warrants in private transactions with the
company in February and March, 2002. These warrants were issued in February and
March 2002, and will expire two years after issuance. Resale of the shares
acquired on exercise of these warrants is covered by this prospectus.
OPTIONS. USE has granted options to employees, officers and directors to
purchase shares at exercise prices from $2.00 to $3.90 per share. At May 15,
2002, a total of 2,978,496 shares may be issued upon exercise of these options.
These options expire at various times from 2002 to 2011.
12
USE OF PROCEEDS
We will not receive any of the proceeds from the sale of the shares by the
selling shareholders pursuant to this prospectus. We will receive proceeds fro
exercise of the warrants held by 16 investors, if they so exercise, which
proceeds will be used by the company for working capital.
SELLING SHAREHOLDERS
This prospectus covers the offer and sale by the selling shareholders of up
to 358,309 shares of common stock ($0.01 par value) owned or to be owned on
exercise of warrants by the selling shareholders. All shares issued are
restricted securities as that term is defined in rule 144 of the Securities and
Exchange Commission under the Securities Act of 1933, and will remain restricted
unless and until such shares are sold pursuant to this prospectus, or otherwise
are sold in compliance with rule 144 or the restriction removed in accordance
with rule 144(k).
None of the selling shareholders are affiliates of the company or any
subsidiary of the company.
Of the shares covered by this prospectus:
o 281,926 shares are held by 16 accredited investors who purchased shares at
$3.25 per share (and warrants, see below) from the company during the
period February 20, 2002 to March 26, 2002, in a private placement
conducted by the company (see below).
o 56,383 shares are issuable on exercise of warrants held by the 16
investors, at an exercise price of $4.00 per share (expire two years from
date of original investment in February and March 2002).
o 20,000 shares are held by Robert H. Taggart, Jr. which were issued to him
in May 2002, in part for the exchange of warrants to purchase 6,703 shares
of common stock of USE (at $3.64 per share) which he acquired in a share
exchange agreement with Yellowstone Fuels Corporation, and for other
services. Mr. Taggart, a securities broker presently associated with
VentureRound Group, L.L.C., previously was associated with another
broker-dealer which raised equity financing for Yellowstone; the former
firm compensated Mr. Taggart by transferring to him warrants to purchase
6,703 shares of Yellowstone, subsequently exchanged (along with all other
warrants held by the former firm) for warrants to purchase shares of USE.
The Yellowstone and USE warrants held by Mr. Taggart have been canceled.
Additional consideration for the issuance of the 20,000 shares to Mr.
Taggart are his service to USE for financial public relations and the
introduction of the company to other stock brokerage firms. These services
have not involved capital formation activities by USE.
The selling shareholders may offer their shares for sale on a continuous
basis pursuant to rule 415 under the 1933 Act.
The following information has been provided to us by the selling
shareholders. All numbers of shares, and percentage ownership, are stated on a
pro forma basis as of prospectus date. There are 11,941,252 shares issued and
outstanding on the initial date of this prospectus; on a pro forma basis,
11,997,635 shares are outstanding. Additional shares issuable on possible
exercise of additional options and warrants presently outstanding, but not held
by the selling shareholders, are not included in the pro forma calculation.
13
Number of Number of Shares
Shares of of Common Stock Percent Owned
Name and Address Common Stock Registered Prior to After
of Beneficial Owner Owned (2) For Sale (2) Offering Offering(1)
- ---------------------------------------------------------------------------------------------------------------
Jeffrey J. Schmitz 3,692 3,692 * 0
10356 E. Weaver Circle
Englewood, CO 80111
Vincent N. Schmitz 18,462 18,462 * 0
4207 Montview Blvd.
Denver, CO 80207
James V. Rauh 18,462 18,462 * 0
7234 South Uravan Ct.
Aurora, CO 80016
Dr. Michael M. Vuocolo DDS 18,462 18,462 * 0
407 Arrowhead BL 123
Jonesboro, GA 30236
Peyton Jackson 9,230 9,230 * 0
8794 Standish Road
Alexandria, VA 22308
P-Con Consulting 9,230 9,230 * 0
5432 Broadmoor Street
Alexandria, VA 22315
Donald F. Kern 27,692 27,692 * 0
2737 Nestlebrook Trail
Virginia Beach, VA
Fiserv Securities Inc. C/FBO 9,230 9,230 * 0
Richard T. Huebner IRA
16318 E. Berry Avenue
Aurora, CO 80015
Fiserv Securities Inc. C/FBO 9,232 9,232 * 0
Steven M. Bathgate IRA
6376 E. Tufts Avenue
Englewood, CO 80111
Generation Capital Association 36,924 36,924 * 0
1085 Riverside Trace
Atlanta, GA 30328
Dr. Ross Krueger 18,462 18,462 * 0
1801 Barrs Suite #605
Jacksonville, FL 32204
John J. Lais III 30,000 30,000 * 0
2602 Woodlant Court
McKinney, TX 75070
14
James A. McCaughey 46,154 46,154 * 0
First Bank
73-000 Hwy. 111
Palm Desert, CA 92260
Eggleston's, LLC 9,230 9,230 * 0
8109 Wellington Road
Alexandria, VA 22308
Jason Wayne Assad 18,462 18,462 * 0
6585 Sterling Drive
Suwanee, GA 30024
William N. Anderson 55,385 55,385 * 0
6650 Oakhills Drive
Bloomfield, MI 48301
Robert H. Taggart, Jr. 20,000 20,000 * 0
7163 South Chapparal Circle East
Auroro, CO 80016
* Less than 1%.
(1) Assumes all shares are sold by the selling shareholder.
(2) Includes shares issuable on exercise of warrants, at $4.00 per share, and
assumes exercise of such warrants by the selling shareholder.
The shares owned or to be owned by the selling shareholders are registered
under rule 415 of the general rules and regulations of the Securities and
Exchange Commission, concerning delayed and continuous offers and sales of
securities. In regard to the offer and sale of such shares, we have made certain
undertakings in Part II of the registration statement of which this prospectus
is part, by which, in general, we have committed to keep this prospectus current
during any period in which the selling shareholders make offers to sell the
covered securities pursuant to rule 415.
PLAN OF DISTRIBUTION
The selling shareholders and any of their pledgees, donees, assignees and
successors-in-interest may, from time to time, sell any or all of their shares
of common stock on any stock exchange, market or trading facility on which the
shares are traded. These sales may be at fixed or negotiated prices. The selling
shareholders may use any one or more of the following methods when selling
shares:
O ordinary brokerage transactions and transactions in which the
broker-dealer solicits purchasers;
O block trades in which the broker-dealer will attempt to sell the
shares as agent but may position and resell a portion of the block as
principal to facilitate the transaction;
O purchases by a broker-dealer as principal and resale by the
broker-dealer for its account;
O an exchange distribution in accordance with the rules of the
applicable exchange;
15
O privately negotiated transactions;
O short sales (sales of shares not owned in hopes of a decline in market
price so the seller can purchase in the market at a lower price to be
able to deliver the shares sold);
O broker-dealers may agree with the selling shareholder to sell a
specified number of such shares at a stipulated price per share;
O a combination of any such methods of sale; and
O any other method permitted pursuant to applicable law.
The selling shareholders also may resell all or a portion of the shares in
open market transactions in reliance upon rule 144 under the 1933 Act, provided
they meet the criteria and conform to the requirements of the rule.
The selling shareholders may also engage in short sales against the box (a
short sale where the seller borrows the stock from a third party, hoping the
market price will decline), puts and calls and other transactions in securities
of the company or derivatives of company securities and may sell or deliver
shares in connection with these trades. The selling shareholders may pledge
shares to brokers under the margin provisions of customer agreements. If a
selling shareholder defaults on a margin loan, the broker may, from time to
time, offer and sell the pledged shares. The selling shareholders have advised
the company that they have not entered into any agreements, understandings or
arrangements with any underwriters or broker-dealers regarding the sale of their
shares other than ordinary course brokerage arrangements, nor is there an
underwriter or coordinating broker acting in connection with the proposed sale
of shares by the selling shareholders.
Broker-dealers engaged by the selling shareholders may arrange for other
brokers-dealers to participate in sales. Broker-dealers may receive commissions
or discounts from the selling shareholders (or, if any broker-dealer acts as
agent for the purchaser of shares, from the purchaser) in amounts to be
negotiated. The selling shareholders do not expect these commissions and
discounts to exceed what is customary in the types of transactions involved.
We are required to pay all fees and expenses incident to the registration
of resale of the shares covered by this prospectus. However, all discounts,
commissions or fees incurred in connection with the sale of the shares offered
hereby will be paid by the selling shareholders. The company has agreed to
indemnify the selling shareholders against certain losses, claims, damages and
liabilities, including liabilities under the 1933 Act. We have been advised that
in the opinion of the Securities and Exchange Commission, indemnification for
liabilities under the 1933 Act is against public policy, and therefore is
unenforceable. See below.
In order to comply with the securities laws of certain states, if
applicable, the shares will be sold in such jurisdictions, if required, only
through registered or licensed brokers or dealers. In addition, in certain
states the shares may not be sold unless the shares have been registered or
qualified for sale in such state or an exemption from registration or
qualification is available.
16
DISCLOSURE OF COMMISSION POSITION ON
INDEMNIFICATION FOR SECURITIES ACT LIABILITIES
Our articles of incorporation and bylaws provide that we shall indemnify
directors provided that the indemnification shall not eliminate or limit the
liability of a director for breach of the director's duty or loyalty to the
corporation or its stockholders, or for acts of omission not in good faith or
which involve intentional misconduct or a knowing violation of law.
Wyoming law permits a corporation, under specified circumstances, to
indemnify its directors, officers, employees or agents against expenses
(including attorney's fees), judgments, fines and amounts paid in settlements
actually and reasonably incurred by them in connection with any action, suit or
proceeding brought by third parties by reason of the fact that they were or are
directors, officers, employees or agents of the corporation, if these directors,
officers, employees or agents acted in good faith and in a manner they
reasonably believed to be in or not opposed to the best interests of the
corporation and, with respect to any criminal action or proceedings, had no
reason to believe their conduct was unlawful. In a derivative action, i.e., one
by or in the right of the corporation, indemnification may be made only for
expenses actually and reasonably incurred by directors, officers, employees or
agent in connection with the defense or settlement of an action or suit, and
only with respect to a matter as to which they shall have acted in good faith
and in a manner they reasonably believed to be in or not opposed to the best
interests of the corporation, except that no indemnification shall be made if
such person shall have been adjudged liable to the corporation, unless and only
to the extent that the court in which the action or suit was brought shall
determine upon application that the defendant directors, officers, employees or
agents are fairly and reasonably entitled to indemnify for such expenses despite
such adjudication of liability.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
company pursuant to the foregoing provisions, or otherwise (for example, in
connection with the sale of securities), we have been advised that in the
opinion of the Commission such indemnification is against public policy as
expressed in the 1933 Act, and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
the company of expenses incurred or paid by a director, officer or controlling
person in the successful defense of any action, suit or proceeding) is asserted
by such director, officer or controlling person in connection with the
securities being registered, the company will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the 1933 Securities Act, and will be
governed by the final adjudication of such issue.
WHERE TO FIND MORE INFORMATION ABOUT US
We have filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 under the 1933 Act with
respect to the shares offered by this prospectus. This prospectus, filed as a
part of the registration statement, does not contain certain information
contained in part II of the registration statement or filed as exhibits to the
registration statement. We refer you to the registration statement and exhibits
which may be inspected and copied at the Public Reference Section of the
Commission, 450 5th Street, NW, Washington, D.C. 20549, at prescribed rates; the
telephone number for the Public Reference Section is 1.800.SEC.0330. The
registration statement and exhibits also are available for viewing at and
downloading from the EDGAR location within the Commission's internet website
(http://www.sec.gov).
17
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
Our common stock is registered with the Commission under section 12(g) of
the Securities Exchange Act of 1934 (the "1934 Act"). Under the 1934 Act, we
file with the Commission periodic reports on Forms 10-K, 10-Q and 8-K, and proxy
statements, and our officers and directors file reports of stock ownership on
Forms 3, 4 and 5. These filings may be viewed and downloaded from the
Commission's internet website (http://www.sec.gov) at the EDGAR location, and
also may be inspected and copied at the Public Reference Section of the
Commission, 450 5th Street, NW, Washington, D.C. 20549, at prescribed rates; the
telephone number for the Public Reference Section is 1.800.SEC.0330. Information
on the operation of the Public Reference Room can be obtained by calling the
Commission at 1.800.SEC.0330.
All of the information contained in the following documents filed with the
Commission is incorporated by reference into this prospectus: Annual Report on
Form 10-K for fiscal year ended May 31, 2001; Quarterly Report on Form 10-Q for
the Three Months ended August 31, 2001; Quarterly Report on Form 10-Q for the
Six Months ended November 30, 2001; Quarterly Report on Form 10-Q for the Nine
Months ended February 28, 2002; Proxy Statement for Annual Meeting of
Shareholders in December 2001; Report on Form 8-K on September 20, 2001
(reporting adoption in calendar 2001 of a "shareholder rights plan" also
commonly known as a "poison pill"); and Report on Form 8-K on December 20, 2001
regarding status of coalbed methane operations; Report on Form 8-K on April 23,
2002, reporting that Suncor did not exercise an option to acquire interest in
coalbed methane properties and reporting a contract to purchase the Bobcat
coalbed methane property in Wyoming; and Form 8-A, on September 20, 2001,
registering the preferred stock purchase rights (in connection with the
shareholder rights plan). The SEC file number for all of these filings is 000-
06814.
All of the information which will be contained in our future Annual Reports
on Form 10-K, Quarterly Reports on Form 10-Q, Proxy Statements, and Reports on
Form 8-K, and any other filings we make pursuant to sections 13(a), 13(c), 14 or
15(d) of the 1934 Act, all after the date of this prospectus, also are
incorporated by reference into this prospectus as of the dates when such
documents are filed with the Commission.
We will provide to you copies of any or all of the information in these
documents, and any exhibits to them, without charge, upon request addressed to
U.S. Energy Corp., 877 North 8th West, Riverton, Wyoming 82501, attention Daniel
P. Svilar, Assistant Secretary. You also may request these documents by
telephone: 1.307.856.9271. Our internet address is www.useg.com. Our 1934 Act
filings are not directly available through our internet address (website), but
you can access those filings through the link to Nasdaq at our internet address
(website).
18
LEGAL MATTERS
The validity of the issuance of the shares offered has been passed upon by
The Law Office of Stephen E. Rounds, Denver, Colorado.
EXPERTS
Our consolidated balance sheet as of May 31, 2001 and the related
consolidated statements of operations, shareholders' equity and cash flows for
the year ended may 31, 2001, have been audited by Grant Thornton LLP, and are
included, with the audit report from Grant Thornton LLP, in the Annual Report on
Form 10-K for the fiscal year ended May 31, 2001 in reliance upon the authority
of such firm as experts in accounting and auditing. Our consolidated balance
sheet as of May 31, 2000 and the related consolidated statements of operations,
shareholders' equity and cash flows for each of the two years ended May 31,
2000, have been audited by Arthur Andersen LLP, and are included along with the
audit report from Arthur Andersen LLP, in the Annual Report on Form 10-K for the
fiscal year ended May 31, 2001 in reliance upon the authority of such firm as
experts in accounting and auditing in giving said report.
19
358,309 SHARES COMMON STOCK
U.S. ENERGY CORP.
-------------------
PROSPECTUS
--------------------
May _____, 2002
No dealer, salesman or other person is authorized to give any information
or make any information or make any representations not contained in the
prospectus with respect to the offering made hereby. This prospectus does not
constitute an offer to sell any of the securities offered hereby in any
jurisdiction where, or to any person to whom it is unlawful to make such an
offer. Neither the delivery of this prospectus nor any sale made hereunder
shall, under any circumstances, create an implication that there has been no
change in the information set forth herein or in the business of our company
since the date hereof.
20
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
Estimated expenses in connection with the issuance and distribution of the
securities being registered:
Securities and Exchange Commission registration fee...................$ 126.57
National Association of Securities Dealers, Inc. examination fee...... n/a
Accounting ........................................................... 2,000.00
Legal fees and expenses............................................... 2,000.00
Printing ............................................................. n/a
Blue Sky fees and expenses (excluding legal fees)..................... 250
Transfer agent ....................................................... n/a
Escrow agent.......................................................... n/a
Miscellaneous......................................................... n/a
Total.................................................................$ 4,476.57
The Registrant will pay all of these expenses.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Our articles of incorporation and bylaws provide that we shall indemnify
directors provided that the indemnification shall not eliminate or limit the
liability of a director for breach of the director's duty or loyalty to the
corporation or its stockholders, or for acts of omission not in good faith or
which involve intentional misconduct or a knowing violation of law.
Wyoming law permits a corporation, under specified circumstances, to
indemnify its directors, officers, employees or agents against expenses
(including attorney's fees), judgments, fines and amounts paid in settlements
actually and reasonably incurred by them in connection with any action, suit or
proceeding brought by third parties by reason of the fact that they were or are
directors, officers, employees or agents of the corporation, if these directors,
officers, employees or agents acted in good faith and in a manner they
reasonably believed to be in or not opposed to the best interests of the
corporation and, with respect to any criminal action or proceedings, had no
reason to believe their conduct was unlawful. In a derivative action, i.e., one
by or in the right of the corporation, indemnification may be made only for
expenses actually and reasonably incurred by directors, officers, employees or
agent in connection with the defense or settlement of an action or suit, and
only with respect to a matter as to which they shall have acted in good faith
and in a manner they reasonably believed to be in or not opposed to the best
interests of the corporation, except that no indemnification shall be made if
such person shall have been adjudged liable to the corporation, unless and only
to the extent that the court in which the action or suit was brought shall
determine upon application that the defendant directors, officers, employees or
agents are fairly and reasonably entitled to indemnify for such expenses despite
such adjudication of liability.
21
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULE.
SEQUENTIAL
EXHIBIT NO. TITLE OF EXHIBIT PAGE NO.
- ----------- ---------------- ----------
3.1 USE Restated Articles of Incorporation.........................[2]
3.1(a) USE Articles of Amendment to
Restated Articles of Incorporation.............................[4]
3.1(b) USE Articles of Amendment (Second) to
Restated Articles of Incorporation
(Establishing Series A Convertible Preferred Stock.............[9]
3.1(c) Articles of Amendment (Third) to
Restated Articles of Incorporation
(Increasing number of authorized shares)......................[14]
3.2 USE Bylaws, as amended through April 22, 1992..................[4]
4.1 Amendment to USE 1998
Incentive Stock Option Plan
(To include Family Transferability
of Options Under SEC Rule 16b)................................[11]
4.2 USE 1998 Incentive Stock Option Plan
and Form of Stock Option Agreement 1/99........................[8]
4.3 USE Restricted Stock Bonus Plan,
as amended through 2/94........................................[5]
4.4 Form of Stock Option Agreement, and Schedule
Options Granted January 1, 1996................................[6]
4.5 Form of Stock Option Agreement and Schedule,
Options Granted January 10, 2001..............................[11]
4.6 [intentionally left blank)
4.7 USE 1996 Officers' Stock Award Program (Plan)..................[7]
4.8 USE Restated 1996 Officers' Stock Award Plan and
Amendment to USE 1990 Restricted Stock Bonus Plan..............[7]
22
4.9 Warrant held by Caydall LLC...................................[13]
4.10 Warrant held by Kevin P. Daly................................[13]
4.11 Rights Agreement, dated as of September 19, 2001
between U.S. Energy Corp. and Computershare
Trust Company, Inc. as Rights Agent. The Articles of
Amendment to Articles of Incorporation creating the
Series P Preferred Stock is included herewith as an
exhibit to the Rights Agreement.
Form of Right Certificate (as an exhibit to the
Rights Agreement).
Summary of Rights, which will be sent to all holders
of record of the outstanding shares of Common Stock
of the registrant, also included as an exhibit to the
Rights Agreement..............................................[12]
4.12 Form of Advisor Warrant dated October 18, 2001
and List of Holders ..........................................[14]
4.13 Form of Advisor Warrant dated November 2, 2001
and List of Holders...........................................[14]
4.14 Form of Investor Warrant dated October 18, 2001
and List of Holders...........................................[14]
4.15 Stock Option held by R. Jerry Falkner
dated April 11, 2001..........................................[14]
4.16 Warrant held by Riches In Resources
dated May 14, 2001............................................[14]
4.17 Stock Option held by R. Jerry Falkner dated
October 11, 1999 and First Amendment thereto..................[15]
4.18 Amendment dated April 25, 2002 to
October 11, 1999 Stock Option
Agreement held by R. Jerry Falkner...........................[16]
5.1 Opinion re legality and consent of counsel.......................*
10.1 USECC Joint Venture Agreement - Amended as of 1/20/89.........[1]
...
10.2 Management Agreement with USECC................................[3]
10.3 Contract - R. J. Falkner & Company
dated April 11, 2001..........................................[11]
23
10.4 Consulting Agreement - Riches In Resources
dated May 14, 2001............................................[11]
10.5 Agreement for Strategic Services
VentureRound Group LLC........................................[14]
10.6-10.60 [intentionally left blank]
10.61 Closing Agreement - Addendum to Agreement
for Purchase and Sale of Assets (see Exhibit 10.62)...........[11]
10.62 Agreement for Purchase and Sale of Assets
(Rocky Mountain Gas, Inc. and Quantum Energy LLC)..............[9]
10.63 Purchase and Sale Agreement
CCBM, Inc. (subsidiary of Carrizo Oil & Gas, Inc.)
and Rocky Mountain Gas, Inc...................................[16]
10.64 Purchase and Sale Agreement
Bobcat Property...............................................[16]
16. Concurrence Letter from Arthur Andersen LLP
on Change of Accounting Firms.................................[10]
21.1 Subsidiaries of Registrant....................................[11]
23.1 Included in Exhibit 5.1
23.2 Consent of Independent Auditors (Grant Thornton LLP).............*
23.3 Consent of [former] audit firm Arthur Andersen LLP...............*
* Filed herewith.
- -------------
Unless otherwise indicated, the SEC File Number for each of the following
documents incorporated by reference is 000-6814.
[1] Incorporated by reference from the like-numbered exhibit to the
Registrant's Annual Report on Form 10-K for the year ended May 31,
1989, filed August 29, 1989.
[2] Incorporated by reference from the like-numbered exhibit to the
Registrant's Annual Report on Form 10-K for the year ended May 31,
1990, filed September 14, 1990.
[3] Incorporated by reference from the like-numbered exhibit to the
Registrant's Annual Report on Form 10-K for the year ended May 31,
1991, filed September 13, 1991.
24
[4] Incorporated by reference from the like-numbered exhibit to the
Registrant's Annual Report on Form 10-K for the year ended May 31,
1992, filed September 14, 1991.
[5] Incorporated by reference from the like-numbered exhibit to the
Registrant's Form S-1 registration statement, initial filing (SEC File
No. 333-1689) filed June 18, 1996).
[6] Incorporated by reference from the like-numbered exhibit to the
Registrant's Annual Report on Form 10-K for the year ended May 31,
1996, filed September 13, 1996.
[7] Incorporated by reference from the like-numbered exhibit to the
Registrant's Annual Report on Form 10-K for the year ended May 31,
1997, filed September 15, 1997.
[8] Incorporated by reference from the like-numbered exhibit to the
Registrant's Annual Report on Form 10-K for the year ended May 31,
1998, filed September 14, 1998.
[9] Incorporated by reference from the like-numbered exhibit to the
Registrant's Annual Report on Form 10-K for the year ended May 31,
2000, filed September 13, 2000.
[10] Incorporated by reference from the like-numbered exhibit to the
Registrant's Form 8-K, filed February 5, 2001.
[11] Incorporated by reference from the like-numbered exhibit to the
Registrant's Annual Report on Form 10-K, filed August 29, 2001.
[12] Incorporated by reference to exhibit number 4.1 to the Registrant's
Form 8-A12G filed, September 20, 2001.
[13] Incorporated by reference from the like-numbered exhibit to the
Registrant's Form S-3 registration statement (SEC File No. 333-73546),
filed November 16, 2001.
[14] Incorporated by reference from the like-numbered exhibit to the
Registrant's Form S-3 registration statement (SEC File No. 333-75864),
filed December 21, 2001.
[15] Incorporated by reference from the like-numbered exhibit to the
Registrant' Form S-3 registration statement (SEC File No. 333-83040),
filed February 19, 2002.
[16] Incorporated by reference from the like-numbered exhibit to the
Registrant's Form S-3 registration statement, amendment no. 1 (SEC
File No. 333-83040), filed May 17, 2002.
25
ITEM 17. UNDERTAKINGS.
(a) RULE 415 OFFERING.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(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 in the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the registration
statement. Notwithstanding the foregoing, any increase or decrease in volume of
securities offered (if the total dollar value of securities offered would not
exceed that which was registered) and any deviation from the low or high end of
the estimated maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than 20% change in the maximum
aggregate offering price set forth in the "Calculation of Registration Fee"
table in the effective registration statement; and
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement.
Provided, however, that paragraphs (1)(i) and (1)(ii) do not apply to this
registration statement if the information required to be included in a
post-effective amendment by those paragraphs is contained in periodic reports
filed with or furnished to the Commission by the registrant pursuant to Section
13 or 15(d) of the Securities Exchange Act of 1934 that are incorporated by
reference in this registration statement.
(2) That, for the purpose of determining any liability under the Act, each
such post-effective amendment shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(b) FILING INCORPORATING SUBSEQUENT EXCHANGE ACT DOCUMENTS BY REFERENCE.
The undersigned registrant hereby undertakes that for purposes of
determining any liability under the Securities Act , each filing of the
registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in the registration statement 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.
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(h) RELATIVE TO REQUEST FOR ACCELERATION OF EFFECTIVE DATE.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933, as amended, may be permitted to directors, officers, and controlling
persons of the registrant pursuant to the foregoing provisions, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Securities Act and is therefore unenforceable. In the event that a claim
for indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer, or controlling
person of the registrant in the successful defense of any action, suit, or
proceeding) is asserted by such director, officer, or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Securities
Act of 1933, as amended, and will be governed by the final adjudication of such
issue.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized in the city of Riverton, state of Wyoming on May 16, 2002.
U.S. ENERGY CORP. (Registrant)
Date: May 16, 2002 By: /s/ John L. Larsen
-----------------------------------
Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this
registration statement on Form S-3 has been signed below by the following
persons on behalf of the Registrant and in the capacities and on the dates
indicated.
Date: May 16, 2002 By: /s/ John L. Larsen
-----------------------------------
Director
Date: May 16, 2002 By: /s/ Keith G. Larsen
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Director
Date: May 16, 2002 By: /s/ Harold F. Herron
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Director
Date: May 16, 2002 By: /s/ Don C. Anderson
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Director
Date: May 16, 2002 By: /s/ Nick Bebout
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Director
Date: May 16, 2002 By: /s/ H. Russell Fraser
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Director
Date: May 16, 2002 By: /s/ Robert Scott Lorimer
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Principal Financial Officer/
Chief Accounting Officer
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