forms_3.htm
As filed
with the Securities and Exchange Commission on June 13, 2008
Registration
No. 333-_____________
Securities
and Exchange Commission
Washington,
D.C. 20549 – 2001
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FORM
S-3
Registration
Statement
Under the
Securities Act of 1933
U.S.
ENERGY CORP.
(Exact
name of registrant as specified in its charter)
Wyoming
(State or
other jurisdiction of incorporation or organization)
83
0205516
(I.R.S.
Employer Identification No.)
877 North 8th West,
Riverton, Wyoming 82501; Tel. 307.856.9271
(Address,
including zip code, and telephone number, including area code,
of
issuer's principal executive offices)
Steven R.
Youngbauer, 877 North 8th West
Riverton, WY 82501; Tel.
307.856.9271
(Name,
address, including zip code, and telephone number of agent for
service)
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Copies
to:
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Stephen
E. Rounds, Esq.
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The
Law Office of Stephen E. Rounds
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1544
York Street, Suite 110, Denver, CO 80206
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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 this
Form is a registration statement pursuant to General Instruction 1.D. or a
post-effective amendment thereto that shall become effective upon filing with
the Commission pursuant to Rule 462(e) under the Securities Act, check the
following box. [ ]
If this
Form is a post effective amendment to a registration statement filed pursuant to
General Instruction 1.D. filed to register additional securities or additional
classes of securities pursuant to Rule 413(b) under the Securities Act, check
the following box. [ ]
Indicate
by check mark whether the registrant is a large accelerated filer, accelerated
filer, a non-accelerated filer, or a smaller reporting company. See definitions
of “large accelerated filer,” “accelerated filer” and “smaller reporting
company” in Rule 12b-2 of the Exchange Act.
¨ Large
accelerated filer ý Accelerated
filer ¨ Non-accelerated
filer ¨ Smaller
reporting Company
CALCULATION
OF REGISTRATION FEE
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Proposed
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Proposed
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Maximum
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Amount
of
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Maximum
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Aggregate
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Title
of Each Class
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Securities
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Offering
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Dollar
Price
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Amount
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of
Securities
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to
be Registered
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Price
Per
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of
Securities to
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of
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to
be Registered
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In
the Offering
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Security
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be
Registered
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Fee
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Common
Stock
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40,000 |
(1) |
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$ |
2.86 |
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$ |
114,400 |
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$ |
4.49 |
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40,000 |
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$ |
114,400 |
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$ |
4.49 |
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(1)
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These
shares are issuable on exercise of a warrant (to purchase 40,000 shares at
$2.81 per share) held by Gordon Financial Advisors
LLC.
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Pursuant
to rule 457(c), registration fee calculations are estimated based on the $2.86
Nasdaq Official Closing Price on June 10, 2008, which is within 5 business days
prior to the filing of this pre-effective registration statement, using the fee
rate of $39.30 per million dollars of the aggregate offering market price at
that date.
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.
U.S.
Energy Corp.
40,000
Shares of Common Stock
This
prospectus covers the offer and sale of up to 40,000 shares of common stock
($0.01 par value) issuable on exercise of a warrant at a price of $2.81 per
share.
In this
prospectus, "selling shareholder" refers to Gordon Financial Advisors LLC, which
owns the warrant. For information about the selling shareholder and
the transaction in which it acquired the warrant, see "Selling
Shareholder."
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 shareholder 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. See “Plan of Distribution.” Although we will
receive proceeds to the extent the warrants are exercised, we will not receive
any proceeds from sale of the shares offered by the selling
shareholder. None of the warrants have been exercised at prospectus
date.
USE is
traded ("USEG") on the Nasdaq Capital Market ($2.86 Nasdaq Official Closing
Price on June 10, 2008).
An
investment in the shares offered by this prospectus is speculative and subject
to risk of loss. See "Risk Factors" beginning on page 9 and the table
of contents on page 4.
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 ______________, 2008
TABLE
OF CONTENTS
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Page
No.
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Summary
Information
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6
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The
Company
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6
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The
Offering
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9
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Risk
Factors
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9
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Risk
Factors Involving Our Business
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9
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We
have a history of operating losses and no recurring business revenues, and
there are uncertainties associated with transaction-based
revenues
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9
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Uncertainties
in the value of the mineral properties
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10
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Compliance
with environmental regulations may be costly
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10
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We
depend on key personnel
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12
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We
may be classified as an inadvertent investment company
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12
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Risks
Relating to USE Stock
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13
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USE
may issue shares of preferred stock with greater rights than its common
stock
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13
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Future
equity transactions, including exercise of options or warrants, could
result in dilution; and registration for public resale of the common stock
in these transactions may depress stock prices.
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13
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Dividends
on USE common stock
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13
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USE’s
take-over defense mechanisms could discourage some advantageous
transactions
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13
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USE’s
stock price likely will continue to be volatile due to several
factors
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13
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Representations
About This Offering
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14
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Forward
Looking Statements
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14
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Description
of Securities
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14
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Common
Stock.
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14
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Preferred
Stock.
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15
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Warrants
Held by Selling Shareholder and Others; and Options Held by Employees and
Directors.
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15
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Warrants
Held by Selling Shareholder and Others.
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15
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Page
No.
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Options
held by Employees and Officers.
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15
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Use
of Proceeds
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Selling
Shareholder
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Plan
of Distribution
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Disclosure
of Commission Position on Indemnification for Securities Act
Liabilities
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Where
to Find More Information About Us
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Incorporation
of Certain Information by Reference
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Legal
Matters
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20
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Experts
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20
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Summary
Information
The
following summarizes all material information found elsewhere in this prospectus
and in the information incorporated into this prospectus. This
summary is qualified by the more detailed information in this prospectus and the
incorporated information.
The
Company
U.S.
Energy Corp. (“USE” or the “Company”), a Wyoming corporation organized in 1966,
acquires and develops energy-related and other mineral
properties. The Company owns patented and unpatented mining claims in
Southwestern Colorado, which contain a significant deposit of
molybdenum. In 2008, we expect to participate as a working interest
owner with independent oil and gas exploration companies, one with respect to a
number of exploratory oil and gas wells in the Gulf Coast region, and the other
with respect to participation in wells in a separate area in South
Louisiana. It is possible that we will enter into exploration
agreements with one or more additional oil and gas companies in
2008. We also are finishing construction of multifamily housing units
in Gillette, Wyoming, which is experiencing a significant shortage of housing
for the local energy industry. As of March 31, 2008, we reported
revenues from the multifamily project but no revenues from the oil and gas
exploration arrangements. Management expects that the multifamily
housing business will provide cash flows in the future but plans to concentrate
primarily on the mineral sector, including oil and gas, and
molybdenum.
Principal
executive offices are located in the Glen L. Larsen building at 877 North 8th
West, Riverton, Wyoming 82501, telephone 307-856-9271. SGMI has an
office in Sutter Creek, California and Vancouver, B.C., Canada.
Our
business strategy has been, and will continue to be, acquiring undeveloped
and/or developed mineral and oil and gas properties, at low acquisition costs
and then operating, selling, leasing or joint venturing the
properties. From time to time, we have set up subsidiary companies to
raise capital for projects, then look to sell the companies to others in the
mineral sector for a profit.
Our
website is www.usnrg.com. We make available on this website, through
a direct link to Securities and Exchange Commission’s website at
http://www.sec.gov, free of charge, our annual reports on Form 10-K; quarterly
reports on Form 10-Q; current reports on Form 8-K; proxy statements; and Forms
3, 4 and 5 for stock ownership by directors and executive
officers. You may also find information related to our corporate
governance, board committees and company code of ethics at our
website.
Minerals.
Mining. USE
currently owns 100% of a world-class molybdenum property in Colorado (the “Lucky
Jack” molybdenum property), a royalty interest in uranium claims on Green
Mountain, Wyoming and has an option to acquire miscellaneous uranium
properties. In 2007, we sold all of our other uranium properties and
the commercial real estate associated with the Utah uranium properties to
Uranium One Ltd. (“Uranium One”).
We are
seeking to acquire undeveloped and/or developed mineral properties, with a view
to operate, sell, lease and/or joint venture the properties with industry
partners. We are also seeking to acquire companies in the minerals
and oil and gas business.
Our
strategy is to demonstrate prospective value in mineral properties sufficient to
support substantial investments by financial institutions and/or industry
partners, then bring in long term development expertise to develop and produce
the properties. Alternatively, we might sell a property
outright. The determinants in this strategy are the quantity and
quality of the minerals in the ground, environmental and permitting requirements
associated therewith, and commodity prices. Although most mineral
commodities are currently at or in excess of historical high prices, viable
properties may be acquired if our financial reward is worth the
risk.
To
demonstrate value to a prospective partner or institution, we may commission a
feasibility study on a mineral property. In some instances, however,
we may be able to raise capital or bring an industry partner into a project
without having a study prepared.
Our
majority-owned subsidiary Sutter Gold Mining Inc., a Canadian company listed on
the TSX-V, is an exploration stage company which owns gold properties in
California. We have no plans to further fund SGMI’s operations,
and in the future, the company may be sold or we may sell off our equity
stake.
Oil and Gas
Exploration. The Company has signed an Exploration and Area of
Mutual Interest agreement with PetroQuest Energy, Inc. (NYSE: PQ) a Gulf Coast (United
States) oil and gas exploration and production company. The Company
anticipates it will participate as a 20% working interest partner in potentially
numerous wells that could be drilled over the next three to five years;
PetroQuest is the operator. Approximately $3 million has been paid under the
agreement to date. Three prospects have been leased, and exploration
and development activities are expected to commence in the later part of the
second quarter of 2008. We believe that numerous prospects could be
generated, leased and drilled potentially resulting in $10,000,000 to
$15,000,000 in exploration and development expenditures for the working interest
over the course of the anticipated three to five year program.
In May
2008, we signed a Joint Exploration Agreement with a private Houston, Texas
based oil and gas company, for USE to participate as a 4.55% working interest
partner in a South Louisiana oil and gas area of mutual interest (AMI) covering
in excess of 50,000 net acres. Our initial commitment to the program
will approximate $1.3 million. The AMI is prospective for oil and gas
resources and includes potential targets in known producing
formations. The Houston based oil company, which is the operator of
the project, has spent the last 15 months securing lease options, analyzing
reprocessed 2-D seismic, and finalizing preparation to conduct a large 3-D
seismic campaign in the near future. In total they have analyzed
approximately 400 miles of recently reprocessed 2-D seismic in preparation for
the 3-D shoot.
Energy Sector
Housing.
The
energy sector is undergoing expansion in the Rocky Mountain region, which is
creating opportunities for new multifamily housing in select
areas. We are building a nine building Class A multifamily apartment
complex in Gillette (Campbell County), Wyoming, which is expected to be
completed in fourth quarter 2008. The buildings, which will have 216
units on 10.15 acres (purchased in 2007), are about 65% complete, with four
buildings finished and occupied. The remaining buildings should be
ready for occupancy by the end of 2008. The apartments are a mix of
one, two, and three bedroom units, and a clubhouse and family amenities are
still under construction. All construction is being conducted by a
third party contractor.
A
commercial bank is providing construction financing of up to $18.5
million. Total cost to buy the land, pay a developer’s fee, obtain
permits and entitlements, site work and construction, is estimated at $26
million. Pursuant to the loan agreement, the Company has invested
$7.0 million into the project (including $1,247,700 for land
purchase). At March 31, 2008, the outstanding balance on the
construction loan was $10.3 million. The interest rate on the loan balance at
March 31, 2008 was 4.9587% based on LIBOR, and interest is payable
monthly. Loan maturity is March 1, 2009 (extendable to September 1,
2009 at our election). Obtaining permanent financing is expected to
be subject to the project meeting the lender’s customary appraised value
requirements.
We also
own a small undeveloped parcel of land in Riverton, Wyoming (adjacent to our
corporate headquarters) which was purchased in December 2007. Plans
for this property are under review, however, we do not expect to expand our
involvement in real estate development beyond the current Gillette
project.
Corporate Developments in
2007.
Crested Corp. Merger into
U.S. Energy Corp. Until November 27, 2007, Crested was a
majority-owned subsidiary of USE. At a special meeting of
shareholders of Crested held on November 26, 2007, a majority of the minority
shareholders of Crested voted to approve the January 23, 2007 (as amended on
July 31, 2007) Agreement and Plan of Merger for the merger of Crested into
USE. Immediately following receipt of such approval, USE (and those
of its affiliates that owned Crested stock) voted their Crested shares in favor
of the agreement. The merger was completed on November 27, 2007, and
Crested was merged into USE pursuant to Colorado and Wyoming law; the former
Crested shareholders received stock in USE (an exchange ratio of 1 USE share for
every 2 Crested shares).
Sale of Uranium
Assets. On April 30, 2007, USE and its then majority-owned
subsidiary Crested, and certain of their private subsidiary companies, sold
their uranium assets by closing the February 22, 2007 Asset Purchase Agreement
(the “APA”) with sxr Uranium One Inc. (“Uranium One,” headquartered in Toronto,
Canada with offices in South Africa and Australia (Toronto Stock Exchange and
Johannesburg Stock Exchange, “UUU”), and certain of its private subsidiary
companies. We received (a) $6,602,700 cash and 6,607,605 Uranium One
common shares (all later sold in 2007 for $90,724,000 cash); and (b) Uranium
One’s assumption of certain specific liabilities associated with the sold
assets. Cash bonds were released and the cash was returned by the regulatory
authorities to the Company in 2007.
On
October 29, 2007, in a separate transaction, Uranium One purchased our Ticaboo
commercial property, associated with the uranium assets sold to Uranium One, for
$2,700,000.
For
details of these transactions, please see “Incorporation of Information by
Reference” below.
Lucky Jack Project –
Molybdenum. On March 31, 2008, Kobex Resources Ltd. gave
notice that Kobex was terminating the Exploration, Operating and Mine
Development Agreement for the Luck Jack molybdenum project near Crested Butte,
Colorado. Kobex had an option to acquire up to a 65% interest in
certain patented and unpatented claims at the property. Under the
agreement, the total cost to Kobex over an estimated period of five years to
exercise the full option was $50 million in option payments and property
expenditures including the costs to prepare a bankable feasibility study plus a
cash differential payment if this total was less than $50 million. An
additional 15% could have been acquired under certain
circumstances.
It is our
understanding that Kobex terminated the agreement due to Kobex’ perception of
uncertainties in the regulatory environment for developing the
property. There were no penalties associated with the
termination.
The
Offering
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Securities
Outstanding
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23,532,996
shares of common stock at June 10, 2008.
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Securities
To Be
Outstanding
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23,572,996
shares of common stock, assuming full vesting and subsequent exercise of
the warrant held by the selling shareholder. See “Description
of Securities” and “Selling Shareholder.”
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Securities
Offered
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40,000
shares of common stock to be owned by the selling
shareholder.
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Use
of Proceeds
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We
will not receive any proceeds from sale of shares by the selling
shareholder, but we will receive up to $112,400 from exercise of the
selling shareholder’s warrant. Net proceeds will be
used for working capital.
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Plan
of Distribution
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The
offering is made by the selling shareholder named in this
prospectus. Sales may be made in the open market or in private
negotiated transactions, at fixed or negotiated prices. See
"Plan of Distribution."
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Risk
Factors
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An
investment is subject to risk. See "Risk
Factors."
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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.
Risk
Factors Involving Our Business
We
have a history of operating losses and no recurring business revenues, and there
are uncertainties associated with transaction-based revenues.
At
December 31, 2007, USE had $19.0 million of retained earnings, a loss before
investment and property transactions of $16.7 million from operations, and a
gain on sale of assets (uranium properties, equipment and marketable securities)
of $106.3 million. At December 31, 2006, the accumulated deficit was
$39.1 million, and for that year we recorded a loss before a benefit from income
taxes of $14.3 million and a net gain after benefit from income taxes of $1.1
million. For the quarter ended March 31, 2008, we had a net loss of
$1,716,600.
Significant
swings in our earnings from year to year has been the nature of our business
model of acquiring, holding and selling mineral properties, because the process
from property acquisition until ultimate sale or joint venture is capital
intensive and often takes years to complete. Although we are
modifying the business to incorporate long-term revenue generating activities
(oil and gas drilling and energy sector housing development, as examples), we do
expect to continue experiencing earnings swings as a substantial portion of our
assets still likely will be long term mineral properties.
Working
capital at December 31, 2007 was $74.6 million ($69,393,500 at March 31,
2008). Historically, working capital needs have been primarily met
from receipt of funds from liquidating investments, selling partial interests in
mineral properties and selling equity. However, long term cash needed
to acquire, develop and produce mineral properties, may exceed the substantial
cash on hand.
Receipt
of funds from selling interests in mineral properties, or liquidating
investments in mineral properties, are unpredictable as to timing, structure,
and profitability. Successful oil and gas exploration activities
could generate positive cash flow and eventually profits, but capital in
addition to these activities plus cash on hand may be needed to develop the
Lucky Jack molybdenum property. We may enter into a joint venture or
other arrangement with an industry partner for this property, but there are no
such arrangements currently in place.
Uncertainties in
the value of the mineral properties.
While we
believe our mineral properties are valuable, substantial work and capital will
be needed to establish whether they are in fact valuable.
The
profitable mining and processing of gold by SGMI will also depend on many
factors, including: receipt of additional permits and keeping in compliance with
permit conditions; delineation through extensive drilling and sampling of
sufficient volumes of mineralized material with sufficient grades to make mining
and processing economic over time; continued sustained high prices for gold, and
obtaining the capital required to initiate and sustain mining operations and
build and operate a gold processing mill.
The Lucky
Jack molybdenum property has been analyzed and explored by its prior
owners. This data will have to be updated to the level of a current
feasibility study to determine the viability of starting mining
operations. Obtaining mining and other permits to begin mining the
molybdenum property may be difficult. Capital requirements for a molybdenum
mining operation will be substantial.
USE has
not yet obtained final feasibility studies on any of its mineral
properties. These studies would establish the potential economic
viability of the different properties based on extensive drilling and sampling;
the design and costs to build and operate mills, the cost of capital, and other
factors. Feasibility studies can take many months or years to
complete. These studies are conducted by professional third-party
consulting and engineering firms, and will have to be completed, at considerable
cost, to determine if the deposits contain proved reserves (i.e., amounts of
minerals in sufficient grades that can be extracted profitably under current
commodity pricing assumptions and estimated for development and operating
costs). A feasibility study usually, but not always, must be
completed in order to raise the substantial capital needed to put a mineral
property into production. We have not established any reserves (i.e.,
economic deposits of mineralized materials) on any of our properties, and future
studies may indicate that some or all of the properties will not be economic to
put into production.
Compliance with
environmental regulations may be costly.
General
Our
business is regulated by government agencies. Permits are required to
explore for minerals, operate mines and build and operate processing
plants. 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 cannot withstand the cost of
complying with changed regulations, USE might decide not to move forward with
the project.
We must
comply with numerous environmental regulations on a continuous basis, to comply
with United States environmental laws, including the National Environmental
Policy Act (“NEPA”), Clean Air Act, the Clean Water Act, and the Resource
Conservation and Recovery Act (“RCRA”). For example, water and dust
discharged from mines and tailings from prior mining or milling operations must
be monitored and contained and reports filed with federal, state and county
regulatory authorities. Additional monitoring and reporting is
required by state and local regulatory agencies. The Abandoned Mine
Reclamation Act in Wyoming and similar laws in other states (for examples,
California for SGMI’s gold property and Colorado for the Lucky Jack molybdenum
property) impose reclamation obligations on abandoned mining properties, in
addition to or in conjunction with federal statutes. Environmental
regulatory programs create potential liability for operations, and may
result in requirements to perform environmental investigations or corrective
actions under federal and state laws and federal and state Superfund
requirements.
Failure
to comply with these regulations could result in substantial fines,
environmental remediation orders and/or potential shut down of the project until
compliance is achieved. Failure to timely obtain required permits to
start operations at a project could cause delay and/or the failure of the
project resulting in a potential write-off of the investments
therein.
Lucky
Jack
The Lucky
Jack molybdenum property is located on fee property within the boundary of U.S.
Forest Service (“USFS”) land. Although mining of the mineral resource
will occur on the fee property, associated ancillary activities will occur on
USFS land. The Company will submit a Plan of Operations to the USFS
in 2008 for USFS approval, which approval is required before construction can
begin and mining and processing may occur. Under the procedures
mandated by the National Environmental Protection Act (“NEPA”), the USFS will
prepare an environmental analysis in the form of an Environmental Assessment
and/or and Environmental Impact Statement to evaluate the
predicted environmental and social economic impacts of the proposed
development and mining of the Lucky Jack molybdenum property. The
NEPA process provides for public review and comment of the proposed
plan.
The USFS
is the lead regulatory agency in the NEPA process, and coordinates with the
various Federal and State agencies in the review and approval of the Plan of
Operations. Various Colorado state agencies will continue to have
primary jurisdiction over certain areas. For example, enforcement of
the Clean Water Act in Colorado is delegated to the Colorado Department of
Public Health and Environment and a water discharge permit under the National
Pollution Discharge Elimination System (“NPDES”) is required before the USFS can
approve the Plan of Operations. The Company currently has a NPDES
Permit from the State of Colorado for the operation of the water treatment plant
at the Lucky Jack molybdenum property; however this permit may need to be
updated. In addition, the Colorado Division of Reclamation, Mining
and Safety issues mining and reclamation permits for mining activities, pursuant
to the Colorado Mined Land Reclamation Act, and otherwise exercises supervisory
authority over mining in the state. As part of obtaining a permit to
mine, the Company will be required to submit a detailed reclamation plan for the
eventual mine closure, which must be reviewed and approved by the
agency. In addition, the Company will be required to provide to the
agency financial assurance that the reclamation plan will be achieved (by
bonding and/or insurance) before the mining permit will be issued.
Obtaining
and maintaining the various permits for the mining operations at the Lucky Jack
molybdenum property will be complex, time-consuming, and
expensive. Changes in a mine’s design, production rates, quality of
material mined, and many other matters, often require submission of the proposed
changes for agency approval prior to implementation. In addition,
changes in operating conditions beyond the Company’s control, or changes in
agency policy and Federal and state law, could further complicate getting
changes to the mine’s operation approved.
The Plan
of Operations of Phelps Dodge Corporation (from whom we received the property)
and its predecessor companies encountered opposition from local and
environmental groups, as well as municipal and county government
agencies. While the new Plan of Operations we are designing (which we
expect will be submitted in 2008 to the United States Forest Service (“USFS”)
for review and approval) is expected to minimize environmental impact and in
other ways be very different from PD’s plan, we anticipate continued local
opposition to any mining of the molybdenum deposit, which could result in
unexpected delays and increased costs to get a new plan approved and
permitted. Although the Company is confident that the Plan of
Operations will ultimately be approved, the timing and cost to obtain approval,
and the ultimate success of the mining operation cannot be
predicted.
We
depend on key personnel.
Our
employees have experience in dealing with the exploration and financing of
mineral properties. We have a very limited staff and executive
group. The loss of key employees could adversely impact our business,
as finding replacements is difficult as a result of competition for experienced
personnel in the minerals industry.
We may be
classified as an inadvertent investment company.
We are
not engaged in the business of investing, reinvesting, or trading in securities,
and we do not hold ourselves out as being engaged in those activities. However,
under the federal Investment Company Act of 1940 (“1940 Act”), a company may
fall within the scope of being an “inadvertent investment company” under section
3(a)(1)(C) of the 1940 Act if the value of its investment securities is more
than 40% of its total assets (exclusive of government securities and cash
items).
As a
result of the 2007 sale of uranium assets to Uranium One, we received investment
securities (stock in Uranium One) with a value in excess of 40% of the value of
our total assets. All of this stock was sold in 2007.
An
inadvertent investment company can avoid being classified as an investment
company if it can rely on one of the exclusions under the 1940
Act. One such exclusion, Rule 3a-2 under the 1940 Act, allows an
inadvertent investment company (as a “transient investment company”) a grace
period of one year from the date of classification (in our case, April 30,
2008), to seek to comply with the 40% limit, or with any other available
exclusion. Accordingly, we have taken actions to comply with this 40%
limit. These actions included liquidating investment securities as
necessary to stay within the 40% limit.
As Rule
3a-2 is available to a company no more than once every three years, and assuming
no other exclusions were available to us, we would have to keep within the 40%
limit through April 30, 2010. In any event, we do not intend to become an
intentional investment company (i.e. engaging in investment and trading
activities in investment securities), even after April 30, 2010.
Classification
as an investment company under the 1940 Act requires registration with the SEC.
If an investment company fails to register, it would have to stop doing almost
all business, and its contracts would become voidable. Registration is time
consuming and restrictive, and we would be very constrained in the kind of
business we could do as a registered investment company.
Risks
Relating to USE Stock
USE
may issue shares of preferred stock with greater rights than its common
stock.
Although
we have no current plans, arrangements, understandings or agreements to do so,
USE’s articles of incorporation authorize the board of directors to issue one or
more series of preferred stock and set the terms of the stock without seeking
approval from holders of the common stock. Preferred stock that is
issued may have preferential rights over the common stock, in terms of
dividends, liquidation rights and voting rights.
Future
equity transactions, including exercise of options or warrants, could result in
dilution; and registration for public resale of the common stock in these
transactions may depress stock prices.
From time
to time, USE has sold restricted stock and warrants and convertible debt to
investors in private placements conducted by broker-dealers, or in negotiated
transactions. Because the stock was issued as restricted, the stock
was sold at a discount to market prices, and the exercise price of the warrants
sometimes, and/or the debt-to-stock conversion price was at or lower than market
prices. These transactions caused dilution to existing
shareholders. Also, from time to time, options are issued to
employees, directors and third parties as incentives, with exercise prices equal
to market prices. Exercise of in-the-money options and warrants will
result in dilution to existing shareholders.
Although
it does not intend to do so at this time, USE may continue to raise capital from
the equity markets using private placements at discounted prices. In
addition, USE may 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.
Dividends
on USE common stock
USE
declared a one time special cash dividend of $0.10 per share on all the common
stock on the record date of July 6, 2007. We may declare dividends in
the future but we expect to retain the majority of earnings and cash to fund
investments and business development.
USE’s
take-over defense mechanisms could discourage some advantageous
transactions.
USE has
adopted a shareholder rights plan, also known as a poison
pill. The plan is designed to discourage a takeover of USE at
an unfair price. However, it is possible that the board of directors
and a potential takeover acquirer would not agree on a higher price, in which
case the takeover might be abandoned, even though the takeover price might be at
a significant premium to market prices. Therefore, as a result of the
mere existence of the plan, shareholders may not receive the premium
price.
USE’s
stock price likely will continue to be volatile due to several
factors.
In the
two years ended December 31, 2007, USE’s stock has traded as low as $3.32 per
share and as high as $7.20 per share. The principal factors which
have contributed to this volatility have been:
price and
volume fluctuations in the stock market generally;
relatively
small amounts of USE stock trading on any given day;
fluctuations
in USE’s financial operating results; and
price
swings in the minerals commodities markets.
These
factors may continue to be influential on our stock price.
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, using assumptions and
available information. These statements involve risks that are both
known and unknown, including unexpected economic and market factors, changes in
operating and capital expenditures, changes in timing or conditions for getting
regulatory approvals to explore mineral properties and put them into production,
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 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.
In
addition, you should note that this prospectus incorporates information about
the Company which has been, and in the future will be, contained in reports and
other matters filed with the SEC. See "Incorporation of Certain
Information by Reference." Those filings will identify forward
looking statements and specify the risks to which those forward looking
statements are subject. You should read the reports
carefully.
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 therefore. There are no restrictions on payment of
cash dividends. USE declared a one time special cash dividend of
$0.10 per share on all the common stock on the record date of July 6,
2007. We may declare dividends in the future but we expect to retain
the majority of earnings and cash to fund investments and business development.
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.
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.
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 a price of $200.00 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 the
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 were reserved for
sale at $10,000 per share. In 2001, 200 shares were issued, and
converted to shares of common stock in 2002. No shares of preferred
stock are outstanding as of the date of this prospectus.
Warrants Held by Selling Shareholder
and Others; and Options Held by Employees and Directors.
Warrants Held by Selling Shareholder
and Others. As of the date of this prospectus, warrants held
by the selling shareholder, and by other persons or entities (not including
employees and officers) are issued and outstanding to purchase a total of
993,887 shares of common stock at exercise prices from $2.25 to $7.02 per share.
Options held by Employees and
Officers. The Company has granted options to employees and
officers to purchase a total of 3,608,356 shares at exercise prices from $2.25
to $4.97 per
share.
Use
of Proceeds
We will
not receive any of the proceeds from the sale of the shares by the selling
shareholder pursuant to this prospectus, but we will receive up to $112,400 from
exercise of the selling shareholder’s warrants. Proceeds will be used
for working capital.
Selling
Shareholder
This
prospectus covers the offer and sale by the selling shareholder of up to 40,000
shares of common stock issuable on exercise of a warrant (at $2.81 per
share). The warrant does not provide anti-dilution
rights.
The
warrant was issued as partial compensation for a one year consulting agreement
with Gordon Financial Advisors LLC (the selling shareholder); the agreement has
a term of one year from May 21, 2008. The warrant vests (then expires
as to each tranche, three years after vesting) as to 10,000 shares on August 31,
2008 (August 30, 2011); November 30, 2008 (November 29, 2011); February 28, 2009
(February 27, 2012), and May 20, 2009 (May 19, 2012). Provided, that
if the closing price for USE stock is more than 150% of the exercise price for
any 20 consecutive trading day period following a vesting, the warrant, to the
extent vested, must be exercised to that extent within 30 calendar
days. If the warrant is not so exercised, it shall expire as to the
unexercised vested portion.
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Shares
of Common Stock Owned
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Number
of Shares Registered
For
Sale
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|
Percent
Owned Before Offering
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Percent
Owned After Offering*
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|
Gordon
Financial Advisors LLC
205
Third Avenue, 19th
Floor
New
York, New York 10003
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10,000(1)
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40,000(2)
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*
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*
|
* Less
than 1%.
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(1)
|
Represents
the 10,000 shares exercisable on vesting of the first tranche of the
warrant on August 31, 2008.
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(2)
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Represents
all the shares underlying the
warrant.
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Resale of
the shares covered by this prospectus and owned or to be owned by the selling
shareholder is 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
shareholder make offers to sell the covered securities pursuant to rule
415.
Plan
of Distribution
The
selling shareholder and any of its pledges, assignees and successors-in-interest
may, from time to time, sell any or all of the shares of common stock on any
stock exchange, market or trading facility on which the shares are traded, or in
private transactions. These sales may be at fixed or negotiated
prices. The selling shareholder may use any one or more of the
following methods when selling shares:
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·
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ordinary
brokerage transactions and transactions in which the broker-dealer
solicits purchasers;
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·
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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;
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·
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purchases
by a broker-dealer as principal and resale by the broker-dealer for its
account;
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·
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an
exchange distribution in accordance with the rules of the applicable
exchange;
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·
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privately
negotiated transactions;
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·
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settlement
of short sales entered into after the date of this
prospectus;
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·
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broker-dealers
may agree with the selling shareholder to sell a specified number of such
shares at a stipulated price per
share;
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·
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a
combination of any such methods of
sale;
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·
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through
the writing or settlement of options or other hedging transactions,
whether through an options exchange or
otherwise;
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·
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any
other method permitted pursuant to applicable
law.
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The
selling shareholder may also sell shares under Rule 144 under the Securities Act
of 1933, if available, rather than under this prospectus.
Broker-dealers
engaged by the selling shareholder may arrange for other brokers-dealers to
participate in sales. Broker-dealers may receive commissions or
discounts from the selling shareholder (or, if any broker-dealer acts as agent
for the selling shareholder, from the selling shareholder) in amounts to be
negotiated. The selling shareholder does not expect these commissions
and discounts relating to its sales of shares, to exceed what is customary in
the types of transactions involved. In connection with the sale of our common
stock, the selling shareholder may enter into hedging transactions with
broker-dealers or other financial institutions, which may in turn engage in
short sales of the common stock in the course of hedging the positions they
assume. The selling shareholder may also sell shares of our common
stock short and deliver these securities to close out their short positions, or
loan or pledge the common stock to broker-dealers that in turn may sell these
securities. The selling shareholder may also enter into option or
other transactions with broker-dealers or other financial institutions or the
creation of one or more derivative securities which require the delivery to such
broker-dealer or other financial institution of shares offered by this
prospectus, which shares such broker-dealer or other financial institution may
resell pursuant to this prospectus (as supplemented or amended to reflect such
transaction).
The
selling shareholder and any broker-dealers or agents that are involved in
selling the shares may be deemed to be “underwriters” within the meaning of the
Securities Act in connection with such sales. In such event, any
commissions received by such broker-dealers or agents and any profit on the
resale of the shares purchased by them may be deemed to be underwriting
commissions or discounts under the Securities Act. Each selling
shareholder has informed the Company that it does not have any agreement or
understanding, directly or indirectly, with any person to distribute the common
stock.
The
Company is required to pay certain fees and expenses incurred by the Company
incident to the registration of the shares. The Company has agreed to
indemnify the selling shareholder against certain losses, claims, damages and
liabilities, including liabilities under the Securities 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.
Because
the selling shareholder may be deemed to be an “underwriter” within the meaning
of the Securities Act, they will be subject to the prospectus delivery
requirements of the Securities Act. In addition, any securities
covered by this prospectus which qualify for sale pursuant to Rule 144 under the
Securities Act may be sold under Rule 144 rather than under this
prospectus. The selling shareholder has advised us that it has not
entered into any agreements, understandings or arrangements with any underwriter
or broker-dealer regarding the sale of the shares. There is no
underwriter or coordinating broker acting in connection with the proposed sale
of the resale shares by the selling shareholder.
The
shares will be sold only through registered or licensed brokers or dealers if
required under applicable state securities laws. In addition, in
certain states, the resale shares may not be sold unless they have been
registered or qualified for sale in the applicable state or an exemption from
the registration or qualification requirement is available and is complied
with.
Under
applicable rules and regulations under the Exchange Act, any person engaged in
the distribution of the resale shares may not simultaneously engage in market
making activities with respect to our common stock for a period of two business
days prior to the commencement of the distribution. In addition, the
selling shareholder will be subject to applicable provisions of the Exchange Act
and the rules and regulations thereunder, including Regulation M, which may
limit the timing of purchases and sales of shares of our common stock by the
selling shareholder or any other person. We will make copies of this
prospectus available to the selling shareholder and have informed it of the need
to deliver a copy of this prospectus at or prior to the time of the sale, as
required by law.
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.
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, Public Reference Room, 100 F Street, N.E., 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 (www.sec.gov).
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, Public Reference Room, 100 F Street, N.E., 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:
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·
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Form
10-K for the twelve months ended December 31, 2007 (filed March 13,
2008).
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Form
10-K/A for the twelve months ended December 31, 2007 (filed May 1, 2008,
to include officer certifications inadvertently omitted from the Form
10-K).
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Definitive
proxy statement for the June 27, 2008 annual meeting of shareholders
(filed April 29, 2008).
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Form
10-Q for the three months ended March 31, 2008 (filed May 12,
2008).
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Definitive
proxy statement for June 23, 2006 annual meeting of shareholders (filed
May 9, 2006).
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Departure
of an officer and director and appointment of replacement director (filed
January 23, 2008).
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Receipt
of Approval from the Colorado Division of Mining, Reclamation and Safety
for an amended program of delineation drilling at the Lucky Jack project
(filed February 15, 2008).
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Results
of metallurgical testing at the Lucky Jack project (filed February 25,
2008)
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Termination
of agreement with Kobex Resources Ltd. (filed April 1,
2008).
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Appointment
of engineering firm for the Lucky Jack project (filed April 30,
2008).
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Scheduling
of a May 15, 2008 conference (filed May 12,
2008).
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·
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Exploration
agreement for an area in South Louisiana (with a private Texas oil and gas
company) (filed May 14, 2008).
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The SEC
file number for all of these filings is 000-6814.
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, will also be 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 Steven R.
Youngbauer, Secretary. You also may request these documents by
telephone: 1.307.856.9271. Our internet address is
www.usnrg.com. Except for reports filed by officers and directors
under section 16(a) of the 1934 Act, our 1934 Act filings are not directly
available through our internet address (website), but you can access those
filings through the link at our internet address (website) or at
sec.gov.
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
The
Company’s consolidated balance sheets as of December 31, 2007 and December 30,
2006, and the related consolidated statements of operations and comprehensive
income, stockholders’ equity and cash flows for each of the years in the two
year-period ended December 31, 2007, were audited by Moss Adams LLP, and are
incorporated by reference in this prospectus and registration statement along
with their report (from the Annual Report on Form 10-K for the twelve months
ended December 31, 2007), in reliance upon the authority of such firm as experts
in accounting and auditing. This firm also audited our internal
control over financial reporting as of December 31, 2007, based on criteria
established in Internal
Control - Integrated Framework issued by the Committee of Sponsoring
Organizations of the Treadway Commission (COSO).
The
Company’s consolidated statements of operations, shareholders’ equity and cash
flows for the year ended December 31, 2005, were audited by Epstein Weber &
Conover, PLC, and are incorporated by reference in this prospectus and
registration statement along with their report (from the Annual Report on Form
10-K for the twelve months ended December 31, 2007), in reliance upon the
authority of such firm as experts in accounting and auditing.
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
|
|
$ |
5 |
|
|
National
Association of Securities Dealers, Inc. examination fee
|
|
|
n/a |
|
|
Accounting
|
|
|
2,000 |
|
|
Legal
fees and expenses
|
|
|
3,500 |
|
|
Printing
|
|
|
n/a |
|
|
Blue
Sky fees and expenses
|
|
|
n/a |
|
|
Transfer
agent
|
|
|
n/a |
|
|
Escrow
agent
|
|
|
n/a |
|
|
Miscellaneous
|
|
|
n/a |
|
|
Total
|
|
$ |
5,505 |
|
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.
Item
16. Exhibits
|
(5)
Exhibits Required to be Filed
|
|
|
|
|
|
Exhibit
No.
|
Title of Exhibit
|
Sequential
Page
No.
|
|
|
|
|
|
3.1
|
Restated
Articles of Incorporation
|
[2]
|
|
|
|
|
|
3.1(a)
|
Articles
of Amendment to Restated Articles of Incorporation
|
[4]
|
|
|
|
|
|
3.1(b)
|
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]
|
|
|
|
|
|
3.1(d)
|
Articles
of Amendment to Restated Articles of Incorporation (establishing Series P
Preferred Stock)
|
[5]
|
|
|
|
|
|
3.1(e)
|
Articles
of Amendment to Restated Articles of Incorporation (providing that
directors may be removed by the shareholders only for
cause)
|
[3]
|
|
|
|
|
|
3.2
|
Bylaws,
as amended through March 7, 2008
|
[6]
|
|
|
|
|
|
4.1
|
Amendment
to 1998 Incentive Stock Option Plan
|
[11]
|
|
|
|
|
|
4.2
|
2001
Incentive Stock Option Plan (amended in 2003)
|
[7]
|
|
|
|
|
|
4.3
|
Warrant
(Gordon Financial Advisors LLC)
|
*
|
|
|
|
|
|
4.4-4.10
|
[intentionally
left blank]
|
|
|
|
|
|
|
4.11
|
Rights
Agreement dated as of September 19, 2001, amended as of September 30,
2005, between U.S. Energy Corp. and Computershare Trust Company, Inc. as
Rights Agent. The Articles of Amendment to the Restated Articles of
Incorporation creating the Series P Preferred Stock are
included as an exhibit to the Rights Agreement, as well as the
form of Right Certificate and Summary of Rights
|
[12]
|
|
|
|
|
|
4.12-4.20
|
[intentionally
left blank]
|
|
|
|
|
|
|
4.21
|
2001
Officers' Stock Compensation Plan
|
[18]
|
|
|
|
|
|
4.22-4.30
|
[intentionally
left blank]
|
|
|
|
|
|
|
5
|
Legal
Opinion
|
*
|
|
|
|
|
|
23.1
|
Consent
of Independent Registered Public Accounting Firm (Epstein, Weber &
Conover)
|
*
|
|
|
|
|
|
23.2
|
Consent
of Independent Registered Public Accounting Firm (Moss Adams
LLP)
|
*
|
|
|
|
|
|
23.3
|
Consent
of SEC Counsel
|
*
|
|
|
|
|
|
*
Filed herewith
|
|
|
By Reference
|
|
|
|
|
[1]
|
Intentionally
left blank.
|
|
|
|
|
[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 exhibit 10.1 to the Registrant’s Form 8-K, filed June
26, 2006.
|
|
|
|
|
[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,
1992.
|
|
|
|
|
[5]
|
Incorporated
by reference from the Registrant’s Form S-3 registration statement
(333-75864), filed December 21, 2001.
|
|
|
|
|
[6]
|
Incorporated
by reference from exhibit 10.1 to the Registrant's Form 8-K, filed March
14, 2008.
|
|
|
|
|
[7]
|
Incorporated
by reference from exhibit 4.2 to the Registrant’s Annual Report on Form
10-K for the year ended December 31, 2004, filed April 15,
2005.
|
|
|
|
|
[8]
|
Intentionally
left blank.
|
|
|
|
|
[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, 1998, filed September 14,
1998.
|
|
|
|
|
[10]
|
Intentionally
left blank.
|
|
|
|
|
[11]
|
Incorporated
by reference from the like-numbered exhibit to the Registrant's Annual
Report on Form 10-K for the year ended on May 31, 2001, filed August 29,
2001, and amended on June 18, 2002 and September 25,
2002.
|
|
|
|
|
[12]
|
Incorporated
by reference to exhibit number 4.1 to the Registrant's Form 8A/A, filed
November 17, 2005.
|
|
|
|
|
[13]-[17]
|
Intentionally
left blank.
|
|
|
|
|
[18]
|
Incorporated
by reference from the like-numbered exhibit to the Registrant's Annual
Report on Form 10-K for the year ended May 31, 2002, filed September 13,
2002.
|
|
|
|
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.
(c) 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.
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 amendment to registration statement
to be signed on its behalf by the undersigned, thereunto duly authorized in the
city of Riverton, State of Wyoming, on June 13, 2008.
U.S.
ENERGY CORP. (Registrant)
|
Date:
June 13, 2008
|
By:
|
/s/ Keith
G. Larsen
|
|
|
|
Keith
G. Larsen, CEO
|
|
|
|
|
|
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:
June 13, 2008
|
By:
|
/s/ Keith
G. Larsen
|
|
|
|
Keith
G. Larsen, Director
|
|
|
|
|
|
|
|
|
|
Date:
June 13, 2008
|
By:
|
/s/ Mark
J. Larsen
|
|
|
|
Mark
J. Larsen, Director
|
|
|
|
|
|
|
|
|
|
Date:
June 13, 2008
|
By:
|
/s/ Robert
Scott Lorimer
|
|
|
|
Robert
Scott Lorimer,
|
|
|
|
Principal
Financial Officer/
|
|
|
|
Chief
Accounting Officer, and Director
|
|
|
|
|
|
|
|
|
|
Date:
June 13, 2008
|
By:
|
/s/ Michael
H. Feinstein
|
|
|
|
Michael
H. Feinstein, Director
|
|
|
|
|
|
|
|
|
|
Date:
June 13, 2008
|
By:
|
/s/ Al
Winters
|
|
|
|
Al
Winters, Director
|
|
|
|
|
|
|
|
|
|
Date:
June 13, 2008
|
By:
|
/s/ H.
Russell Fraser
|
|
|
|
H.
Russell Fraser, Director
|
|
|
|
|
|
|
|
|
|
Date:
June 13, 2008
|
By:
|
/s/ Michael
Anderson
|
|
|
|
Michael
Anderson, Director
|