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): September 22, 2000
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COLORADO WYOMING RESERVE COMPANY
(Exact name of registrant as specified in its charter)
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WYOMING 0-09482 83-0246080
(State or other jurisdiction of (Commission File Number) (I.R.S. Employer
incorporation or organization) Identification Number)
751 HORIZON COURT, SUITE 205
GRAND JUNCTION, COLORADO 81506
(970) 255-9995
(Address and Telephone Number of Registrant's Principal Executive Office)
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ITEM 5. OTHER EVENTS
On September 28, 2000, Colorado Wyoming Reserve Company (the "Company")
entered into a Farmout Agreement, effective as of September 22, 2000, with ST
Oil Company, a Nevada corporation, FM Energy LLC, a California limited liability
company, and The Shoreline Companies, LLC, a Colorado limited liability company
(collectively, the "Farmees"). The Company's Chief Executive Officer and
President and certain directors and stockholders of the Company are directors,
officers and controlling stockholders of ST Oil Company, FM Energy and
The Shoreline Companies.
Under the Farmout Agreement, the Company has agreed to assign 50% of its
mineral working interests in and to certain oil and gas leases and seismic
options covering approximately 61,000 acres of land located in the Paradox Basin
in San Juan County, Utah, to the Farmees once they have completed, processed,
interpreted and provided the Company with a three-dimensional seismic survey of
up to 50 square miles of land covered by such oil and gas leases and seismic
options (the "Survey"). The Farmees will bear the entire cost of the Survey, up
to a maximum of $1,100,000. The Company is not obligated to assign any interests
unless and until it has received the Survey in a form reasonably acceptable to
it.
The Farmees have agreed to begin work on the Survey as soon as reasonably
practicable and to complete the Survey within 180 days of commencement.
On September 28, 2000, the Farmees deposited $1,000,000 with a managing
agent to fund the Survey.
The Farmout Agreement also establishes an area of mutual interest (the
"AMI") for a term of ten years from the effective date of the Farmout Agreement.
If during the ten-year term, any party to the Farmout Agreement acquires an oil
or gas leasehold interest in the AMI, that party must give all other parties the
opportunity to participate.
On September 28, 2000, the Company also entered into a Credit Agreement
with ST Oil Company, FM Energy LLC and The Shoreline Companies, LLC. The Credit
Agreement establishes a revolving line of credit for the Company in an aggregate
principal amount not to exceed $100,000, which will be decreased by the amount
of any funds privately raised by the Company in excess of $100,000 in the next
12 months. Amounts borrowed under the Credit Agreement bear interest at the rate
of 8% per annum. The total balance outstanding under the Credit Agreement will
be due and payable in full on the later of September 28, 2001, or the date on
which the Seismic Acquisition Agreement between ST Oil Company, FM Energy LLC
and The Shoreline Companies, LLC terminates.
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Previous to the farmout arrangement described above, in April 2000 the
Company had entered into an Option Agreement with ST Oil Company and Edwards
Energy Corporation, a Letter of Intent with FM Energy and a Letter of Intent
with The Shoreline Companies, which agreements contemplated a joint venture
arrangement to be established by all the parties similar to the arrangement set
forth in the Farmout Agreement and the Credit Agreement described herein.
Pursuant to the terms of the Option Agreement, the Company was paid $24,000
during the last quarter of fiscal 2000 for the option. The option and the
letters of intent expired according to their terms on August 30, 2000. The
Farmout Agreement and the Credit Agreement reflect the final agreement of the
parties regarding the acquisition by ST Oil, FM Energy and The Shoreline
Companies of an aggregate 50% of the Company's working interests in certain
leases and seismic options in exchange for providing the Company with a seismic
survey of certain acreage covered by such leases and options.
ITEM 7(C). EXHIBITS FILED
EXHIBIT
NUMBER DESCRIPTION
10.1 Farmout Agreement, effective as of September 22, 2000, by and among
the Company, ST Oil Company, FM Energy LLC and The Shoreline
Companies, LLC.
10.2 Credit Agreement, dated September 22, 2000, by and among the
Company, ST Oil Company, FM Energy LLC and The Shoreline Companies,
LLC.
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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.
Colorado Wyoming Reserve Company
Date: September 29, 2000 By: /S/KIM M. FUERST
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Kim M. Fuerst
Chief Executive Officer and President
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EXHIBIT INDEX
EXHIBIT
NUMBER DESCRIPTION
10.1 Farmout Agreement, effective as of September 22, 2000, by and among
the Company, ST Oil Company, FM Energy LLC and The Shoreline
Companies, LLC.
10.2 Credit Agreement, dated September 22, 2000, by and among the
Company, ST Oil Company, FM Energy LLC and The Shoreline Companies,
LLC.
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