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): December 26, 2003
EAGLE EXPLORATION COMPANY
---------------------------------------------
(Exact name of registrant as specified in its charter)
Colorado
(State or Other Jurisdiction of Incorporation)
0-9458 84-0804143
- ------------------------------- -------------------------------------
(Commission File Number) (I.R.S. Employer Identification No.)
1801 Broadway, Suite 810
Denver, Colorado 80202
(Address of principal executive offices)
(303) 296-3677
--------------------------------------------------
(Registrant's telephone number, including area code)
N/A
------------------------------------------------------
(Former Name or Former Address, if Changes Since Last Report)
Item 5. Other Events.
- ------
As reported in its Annual Report on Form 10-KSB for the fiscal year ended
March 31, 2002, Eagle Development Company, a wholly owned subsidiary of Eagle
Exploration Company (the "Company") owns a 25% membership interest in, and is
co-manager of, Buffalo Highlands, LLC, a Colorado limited liability company
formed on August 20, 2001 ("the LLC"). The LLC owns an option ("First Option")
to purchase approximately 320 acres of undeveloped land in Adams County,
Colorado, immediately north of Denver, Colorado.
The First Option provided for a $25,000 earnest money payment and five
$200,000 option payments from the LLC to the landowners. The first of these
payments was made in August of 2001, the second payment was made on August 20,
2002, the third payment was made on January 15, 2003, the fourth payment was
made by the homebuilder through the escrow described below on January 15, 2004
and the remaining payment is due December 31, 2004. The First Option period can
be extended thereafter under certain conditions through December 31, 2008 by the
payment each six months of $100,000 plus interest. All option payments are
non-refundable. The earnest money and all options payments may be applied toward
the $5,000,000 purchase price of the land if the First Option is exercised. The
LLC may be required to obtain relevant relinquishment agreements, quit claim
deeds, surface use agreements or long term development leases and the landowner
is required to reimburse the LLC by reducing the purchase price at closing by
the LLC's cost of acquiring the foregoing by an amount up to $100,000 or
reimburse the LLC that same amount in the event the LLC elects not to exercise
the First Option.
It is the intent of the LLC to improve the property by obtaining the proper
entitlements for single and multi family use. The LLC plans to rezone the
property, plat the property for high-density residential use, and sell the
property prior to the expiration date of the First Option.
In accordance with its plan, the LLC entered into an option agreement
("Second Option") with an unaffiliated national homebuilder. The homebuilder
notified the LLC of its intent to proceed under the Second Option on December
26, 2003. The Second Option essentially assigns the First Option to the
homebuilder, and requires the homebuilder, to the extent it continues, to escrow
with a title company semi-annual payments in the amount of $234,000, which may
be applied to its purchase price, as consideration for the assignment. The
homebuilder must also pay the remaining option payments under the First Option
and pay all entitlement, zoning and development costs. If the necessary permits
and approvals are acquired, the homebuilder has the right to purchase a minimum
of approximately 600 lots (platting will determine the ultimate number
available) on a portion of the property encompassing approximately 200 of the
total of 320 acres. The homebuilder will be required to pay to the LLC $19,500
per lot. The remaining parcel of approximately 120 acres will be reassigned by
the homebuilder to the LLC which intends to donate the 120 acres to the city in
exchange for park fee credits to be purchased by the homebuilder from the LLC at
the time building permits are obtained for each residence at the rate of
approximately $2,000 per unit. As additional consideration for the parcel, the
homebuilder agreed to assign on-site improvements and off-site improvements
pertaining to the project to a metropolitan district, formed by the LLC, with
instructions that the LLC will be entitled to any payments or reimbursements
made to the district.
During the option period, which can be extended under certain circumstances
to December 31, 2008, the homebuilder has the right to exercise the Second
Option as to 40% of the approximately 600 lots thereby exercising and paying the
full amount due under the First Option. The homebuilder must then reassign the
remaining portions of the land to the LLC. The homebuilder will have the right
to acquire approximately 180 lots from the LLC at a second closing, and an
option to acquire the remaining 180 lots at a third and final closing.
Subject to regulatory approvals and possible extensions, and other
conditions, the first closing under the Second Option may occur no later than
January 25, 2005. The second closing may be scheduled no earlier than one year,
nor later than two years thereafter. The final closing may be scheduled no later
than the earlier of two years after the second closing or 21 days after the
homebuilder has sold 105 of the lots acquired on the second closing.
There can be no assurance that the homebuilder will be successful in
obtaining all of the many local, county and state approvals, permits and
licenses required to commence development of the land subject to the options. In
addition, the homebuilder faces risks outside its control, including, city
approval of final plat, title defects, inability to obtain adequate water and
sanitation facilities, general economic conditions, changes in interest rates
and infrastructure problems. Further in the event the LLC is unable to obtain a
final plat from the city and or adequate water and sanitation facilities are not
available, the LLC is obligated to reimburse the homebuilder for its option
payments. Hence, there can be no assurance that the homebuilder will exercise
any of its rights under the Second Option or, in such event, that the LLC could
then find other parties to develop the property within the time periods
remaining under the First Option.
Item 7. Financial Statements and Exhibits.
- ------
(a) Financial Statements: Not applicable
(b) Pro Forma Financial Statements: Not applicable.
(c) Exhibits:
No. Description
--- -----------
10.1 Agreement to Assign Option Agreement and Option Agreement
SIGNATURE
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.
EAGLE EXPLORATION COMPANY
Date: January 15, 2004 By: /s/ Raymond N. Joeckel
Raymond N. Joeckel
President
EXHIBIT INDEX
No. Description
- --- -----------
10.1 Agreement to Assign Option Agreement and Option Agreement
