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U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
June 1, 2000
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Date of Report (date of earliest event reported)
Pontotoc Production, Inc.
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Exact Name of Registrant as Specified in its Charter
Nevada 0-21313 84-1349552
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State or Other Jurisdiction Commission File IRS Employer Identifi-
of Incorporation Number cation Number
808 E. Main, Ada, Oklahoma 74820
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Address of Principal Executive Offices, Including Zip Code
(580) 436-6100
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Registrant's Telephone Number, Including Area Code
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ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
On June 1, 2000, Pontotoc Production, Inc. (the "Company") acquired all
of the outstanding stock of Oklahoma Basic Economy Corporation ("OBEC"), an
Oklahoma corporation, for $8 million in cash. In related transactions, the
Company also purchased working interests in certain oil and gas properties in
which OBEC holds a substantial interest, for an aggregate of approximately
$1.8 million. OBEC is an Oklahoma based oil and gas production company. The
oil and gas properties acquired through the acquisition of OBEC and the
related working interests currently produce approximately 400 net equivalent
barrels of oil per day (525 gross equivalent barrels). Proven reserves on the
properties are estimated to be 7.6 million barrels of oil equivalent (BOE)
consisting of 2.1 million proved producing and 5.5 million proved undeveloped
BOE. Included in the assets of OBEC are two workover rigs with support
equipment, several tank trucks and a fully equipped field shop.
The stock of OBEC was acquired from Mike Cantrell, of Ada, Oklahoma,
pursuant to the terms of a Stock Purchase and Sale Agreement dated May 9,
2000. The working interests were acquired from approximately 23 participants.
The cash used in these transactions was obtained under a $15 million Amended
and Restated Credit Agreement with Local Oklahoma Bank, N.A. Advances under
this line of credit bear interest at the LIBOR Rate plus 2%, are payable in
monthly installments and due in full by August 10, 2002.
Pursuant to the terms of the Stock Purchase and Sale Agreement, the $8
million purchase price is subject to adjustment in the event the current
assets of OBEC were not equal to its current liabilities on the closing date.
Any excess of current assets are to be paid to Mike Cantrell and the amount of
any current liabilities in excess of current assets is to be repaid to the
Company.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(a) FINANCIAL STATEMENTS OF BUSINESSES ACQUIRED. The financial
statements for OBEC will be filed by amendment on or before August 15, 2000.
(b) PRO FORMA FINANCIAL INFORMATION. The unaudited pro forma financial
information will be filed by amendment on or before August 15, 2000.
(c) EXHIBITS. The following exhibits are filed herewith:
Exhibit
Number Description Location
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10.1 Stock Purchase and Sale Agreement Filed herewith electronically
between Mike Cantrell and Pontotoc
Production, Inc.
10.2 Amended and Restated Credit Filed herewith electronically
Agreement among Local Oklahoma
Bank, N.A., Pontotoc Production,
Inc., et al.
2
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned, hereunto duly authorized.
PONTOTOC PRODUCTION, INC.
Dated: June 15, 2000 By:/s/ James Robby Robson, Jr.
James Robby Robson, Jr., President
