SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report: December 4, 1998
TIPPERARY CORPORATION
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(Exact name of registrant as specified in its charter)
Texas 1-7796 75-1236955
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(State or other jurisdiction (Commission file number) (I.R.S. employer
of incorporation) Identification no.)
633 Seventeenth Street, Suite 1550
Denver, Colorado 80202
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (303) 293-9379
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(Former name or former address if changed since last report)
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ITEM 5. OTHER EVENTS
On November 18, 1998, the Registrant entered into an agreement with
its largest shareholder, Slough Estates USA Inc. ("Slough"), whereby
Slough will provide the Registrant financing of $11.7 million. The
funds will be used to finance ongoing development of its Australia
coalbed methane project and to reduce bank debt. Certain details of
this agreement are set forth in the press release filed herewith as
an exhibit.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial statements of businesses acquired.
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Not applicable.
(b) Pro forma financial information.
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Not applicable.
(c) Exhibits
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1. Press release dated November 23, 1998, of the Registrant.
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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, thereunto duly authorized.
TIPPERARY CORPORATION
(Registrant)
By: s/b David L. Bradshaw
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David L. Bradshaw
President, Chief Executive Officer
Dated: December 4, 1998
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EXHIBIT 1
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FOR IMMEDIATE RELEASE: NEWS
November 23, 1998 AMEX-TPY
TIPPERARY CORPORATION ANNOUNCES NEW $11.7 MILLION
FINANCING ARRANGEMENT WITH LARGEST SHAREHOLDER
DENVER, Colorado -- Tipperary Corporation (AMEX-TPY), an independent oil and gas
company, today announced that Slough Estates USA Inc., the Company's largest
shareholder, has agreed to provide Tipperary financing of $11.7 million. The
Company plans to use the funds to finance ongoing development of its Australia
coalbed methane project and to reduce bank debt. The financing is pursuant to
an agreement which is subject to execution of definitive documents by December
31, 1998.
According to the letter agreement, Slough will extend Tipperary a loan of $1.7
million, which will be in addition to the $3.8 million Slough has previously
loaned the Company. The combined loan will have a three-year term and bear
interest at the London Interbank Offered Rate (LIBOR) plus 3.5%. The Company
will also receive $4.0 million from the purchase by Slough of two million shares
of restricted Tipperary common stock at a price of $2.00 per share. Tipperary
will use $4.7 million to reduce bank debt and retain $1.0 million for working
capital. Slough will receive warrants to purchase up to 500,000 shares of
Tipperary common stock at $3.00 per share. The warrants will be exercisable
during a period beginning two years from the date of closing and ending seven
years from the date of closing.
Additionally, Slough will loan to Tipperary Oil & Gas (Australia) Pty Ltd., a
wholly-owned subsidiary of Tipperary, $6.0 million and will receive a 10% common
stock interest in the subsidiary. The note will bear interest at the rate of
10% per annum plus an additional payment based upon the performance of the Comet
Ridge coalbed methane project in Queensland, Australia. Tipperary intends to
use the loan proceeds to fund its share, and potentially extend loans to cover
part or all of its co-venturers' shares, of the cost of drilling eight wells and
extending the associated gathering system on the Comet Ridge Project. Tipperary
holds a majority interest in the project.
David L. Bradshaw, Tipperary's president and chief executive officer, said, "We
are extremely pleased to have secured funding to finance our continuing
development efforts in Australia. We are seeing an increase in demand for gas
in Queensland and will need to drill additional wells to meet opportunities for
new sales contracts. This project finance loan is made possible by the
Company's recently announced 5-year gas contract with Allgas Energy, Ltd., and
the magnitude of the coalseam methane reserves already proven and likely to be
proven through further drilling."
"It is particularly gratifying that Slough Estates USA is increasing its
investment in the Company and its projects. Slough is paying a premium for
Tipperary stock during a very difficult time for the oil and gas industry.
Slough's parent company, Slough Estates plc, is one of the largest listed
property companies in the United Kingdom, and has been a Tipperary shareholder
since 1986."
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In addition to its interest in the Comet Ridge Project, Tipperary has producing
properties primarily in the Rocky Mountain region and in the Permian Basin of
west Texas and southeast New Mexico.
Information herein contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995, which can be identified by
words such as "may," "will," "expect," "anticipate," "estimate" or "continue,"
or comparable words. In addition, all statements other than statements of
historical facts that address activities that Tipperary expects or anticipates
will or may occur in the future are forward-looking statements. Readers are
encouraged to read the SEC reports of Tipperary, particularly its Form 10-K for
the Fiscal Year Ended September 30, 1997, for meaningful cautionary language
disclosing why actual results may vary materially from those anticipated by
management.
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CONTACTS:
Tipperary Corporation Pfeiffer Public Relations, Inc.
David L. Bradshaw, President and CEO Geoff High
303/293-9379 303/393-7044