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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (date of earliest event reported): July 3, 2000
CARRIZO OIL & GAS, INC.
(Exact name of registrant as specified in its charter)
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<S> <C> <C>
TEXAS 000-22915 76-0415919
(State or other jurisdiction of (Commission (I.R.S. Employer
incorporation) File Number) Identification No.)
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14811 ST. MARY'S LANE
SUITE 148
HOUSTON, TEXAS 77079
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code: (281) 496-1352
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ITEM 5. OTHER EVENTS.
The Company, as one of three plaintiffs, has filed a lawsuit
against BNP Petroleum Corporation, Seiskin Interests, LTD, Pagenergy Company,
LLC and Gap Marketing Company, LLC, as defendants, in the 229th Judicial
District Court of Duval County, Texas, for fraud and breach of contract in
connection with an agreement between plaintiffs and defendants whereby the
defendants were obligated to drill a test well in an area known as the Slick
Prospect in Duval County, Texas. The allegations of the Company in this
litigation are that BNP gave the Company inaccurate and incomplete information
on which the Company relied in making its decision not to participate in the
test well and the prospect, resulting in the loss of the Company's interest in
the lease, the test well and four subsequent wells drilled in the prospect. The
Company seeks to enforce its approximate 23.68% interest in the prospect and
seeks damages or rescission, as well as costs and attorneys' fees. The case was
originally filed in Duval County, Texas on February 25, 2000.
In mid March, 2000, the defendants filed an original answer
and certain counterclaims against plaintiffs, seeking unspecified damages for
slander of title, tortious interference with business relations, bad-faith
litigation, and exemplary damages. The case proceeded to trial before the Court
(without a jury) on June 19, 2000. The trial is currently in recess and is
expected to resume by August 7, 2000. On July 3, 2000, the Company became aware
that on June 30, 2000, defendants filed a second amended answer and counterclaim
and certain supplemental responses to requests for disclosure in which they
stated that they were seeking damages in the amount of $33.5 million by virtue
of an alleged lost sale of the subject properties, $17 million in alleged lost
profits from other prospective contracts, and unspecified incidental and
consequential damages from the alleged wrongful suspension of funds under their
gas sales contract with the gas purchaser on the properties, alleged damage to
relationships with trade creditors and financial institutions, including the
inability to leverage the Slick Prospect, and attorneys' fees at prevailing
hourly rates in Duval County, Texas incurred in defending against plaintiffs'
claims and for 40% of any aggregate recovery in prosecuting their counterclaims.
The Company and the other plaintiffs have filed motions objecting to the
counterclaims on certain procedural grounds, including failure to properly and
timely file and serve plaintiffs with copies of certain pleadings, the effect of
which, if granted, would be to establish the grounds for dismissal of the
counterclaims.
While the Company believes it has sufficient legal defenses to
all of the defendants' counterclaims and intends to vigorously defend itself in
this matter, there can be no assurance that the outcome of any portion of this
litigation will be favorable to the Company. An adverse outcome on the
counterclaims or related matters could have a material adverse effect on the
Company.
The Company has also alleged that BNP Petroleum Corporation,
Seiskin Interests, LTD and Pagenergy Company, LLC breached a contract with the
plaintiffs by obtaining oil and gas leases within an area restricted by that
contract. This breach of contract allegation is the subject of an additional
lawsuit by plaintiffs in the 165th District Court in Harris County, Texas. The
Company is seeking damages as a result of defendants' actions as well as costs
and attorneys' fees.
Statements in this document, including but not limited to
those relating to the above-described litigation, its outcome, effects, timing
and any other statements that are not historical facts are forward-looking
statements that are based on current expectations. Although the Company believes
that its expectations are based on reasonable assumptions, it can give no
assurance that these expectations will prove correct. Important factors that
could cause actual results to differ materially from those in the
forward-looking statements include the outcome and timing of the litigation,
rulings by the court, timing and other factors described in the Company's most
recent Form 10-K and other filings with Securities and Exchange Commission.
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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.
CARRIZO OIL & GAS, INC.
By: /s/ FRANK A. WOJTEK
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Name: Frank A. Wojtek
Title: Vice President and Chief
Financial Officer
Date: July 19, 2000
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