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FORM 8-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
THE EXPLORATION COMPANY
(Exact name of registrant as specified in its charter)
500 NORTH LOOP 1604 EAST, SUITE 250, SAN ANTONIO, TEXAS 78232
(Address of principal executive offices)
(210) 496-5300
(Registrant's telephone number, including area code)
COLORADO 0-9120 84-0793089
(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
Date of Report (Date of Earliest Event Reported): SEPTEMBER 4, 1996
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ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
Purchase of Williston Basin Leases
Under the terms of that certain agreement reported by the Company on
Form 8-K filed May 31, 1996, the Company has closed several transactions with
foreign investors involving the exchange of 2,543,015 shares of its common
stock for a twenty-five percent (25%) interest in 131,860 acres of oil and gas
leases.
Each of the parties listed below (the "Purchasers") exchanged its
individually owned five percent (5%) undivided leasehold working interest
(total 25% working interest) in certain Oil and Gas Leases in the Williston
Basin covering a total of 131,860 net acres, more or less, in the counties of
Stark, Hettinger, Slope, Billings, Golden Valley and Bowman Counties of North
Dakota and in Fallon, Richland and Wibaux Counties of Montana for 2,543,015
shares of the Company's common stock under Regulation S as promulgated under
the Securities Act of 1933, as amended ("the Act"). None of the purchasers are
US persons under the meaning of Rule 902 promulgated under the Act. The price
of the leases was placed at $135.00 per acre which is the cash price paid by
the Purchasers plus $10.00 per acre.
<TABLE>
<CAPTION>
Purchased Net Shares
Non-US Person Interest Acres Acres Basis Issued
------------- -------- ----- ----- ----- ------
<S> <C> <C> <C> <C> <C>
Comstar BioCapital, Inc. 5% 131,860 6,593 $ 890,055 508,603
TransEuro Capital, Inc. 5% 131,860 6,593 $ 890,055 508,603
Pan Pacific Investments, Inc. 5% 131,860 6,593 $ 890,055 508,603
Sorbus Investments, Inc. 5% 131,860 6,593 $ 890,055 508,603
John L. Hales, Individually 5% 131,860 6,593 $ 890,055 508,603
--- ------- ------ ---------- ---------
Totals 25% 131,860 32,965 $4,450,275 2,543,015
</TABLE>
ExproFuels, Inc. Stock Distribution
On September 3, 1996, the Board of Directors voted for a partial
liquidation of the assets by the distribution of approximately 50% of the stock
it owns in its wholly-owned subsidiary, ExproFuels, Inc. to its shareholders.
Shareholders of record as of the close of trading on September 13, 1996, will
receive one share of ExproFuels, Inc. stock for every five shares of The
Exploration Company's common stock then owned. The Board of Directors has
directed that, upon the conclusion of the August 31, 1996 fiscal yearend audit,
a registration statement be filed with the Securities and Exchange Commission
for ExproFuels shares and that the shares then be distributed to the
shareholders. With the distribution, the shareholders will receive
approximately two million shares of the four million outstanding shares.
Unaudited financials indicate that ExproFuels will have assets of approximately
$1,150,000 and net equity of $850,000.
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ITEM 5. OTHER EVENTS
The Company has also raised an additional $2,275,000 cash pursuant to
Regulation S of the Act. A total of 1,300,000 shares were sold at a price of
$1.75 per share to Non-U.S. persons under the meaning of Rule 902 of Regulation
S in Australia, Switzerland and Singapore.
The Company has an outstanding debenture to W.A. Oil & Gas Loan Trust
in the amount of $1,764,697. Effective September 13, 1996, the Company
received notice that $433,484 was to be converted to 173,394 shares of the
Company's common stock under terms of the debenture agreement which will reduce
the outstanding debenture to $1,331,213.
The cumulative effect of the transactions reported in this 8-K is that as of
September 13, 1996, the Company has issued an additional 4,016,409 shares of
its common stock thereby increasing its issued and outstanding shares total
to 9,900,044 shares. The Company's unaudited balance sheet net equity is
anticipated to increase by approximately $7,000,000.
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 thereunto duly authorized.
THE EXPLORATION COMPANY
(Registrant)
/s/ James E. Sigmon
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James E. Sigmon
President
Date: September 17, 1996
