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): April 18, 1997
TEXOIL, INC.
(Exact name of registrant as specified in its charter)
NEVADA 0-12633 88-0177083
(State of incorporation) (Commission File Number) (I.R.S. Employer
Identification No.)
1600 SMITH STREET, SUITE 4000
HOUSTON, TEXAS 77002
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
(713) 652-5741
(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)
(NOT APPLICABLE)
(FORMER NAME OR FORMER ADDRESS, IF CHANGED SINCE LAST REPORT)
Item 5. Other Events
(a) Financing Activity
Texoil, Inc. reported on Form 10-KSB for the fiscal year ended December
31, 1996 that it was seeking additional debt capital or equity in connection
with having acquired approximately double the amount of lease acreage and
its plans to explore into deeper horizons than originally planned in both
the Raceland and Greens Lake Prospects. Texoil Company ("Company"), a wholly
owned subsidiary of Texoil, Inc. received a commitment on April 18, 1997 for
up to $1,500,000 in exchangeable debt financing from Resource Investors
Management Company Limited Partnership ("RIMCO") on behalf of RIMCO
Partners, L.P., RIMCO Partners, L.P. II, RIMCO Partners, L.P. III AND RIMCO
Partners, L.P. IV. The financing is in the form of Senior Secured
Exchangeable General Obligation Notes issued by the Company in the maximum
amount of $1,500,000 ("Exchangeable Notes"). The Exchangeable Notes are
intended to fund Raceland and Greens Lake Prospect drilling and completion
costs in excess of funds available from the Company's existing $3,000,000
Senior Exchangeable General Obligation Notes dated September 6, 1996. As of
April 22, 1997 the Company had borrowed $1,642,134 under this $3,000,000
facility.
The Exchangeable Notes commitment provides for a six month availability
period with a maturity date of September 1, 1999. Amounts advanced under the
Exchangeable Notes will accrue interest at a fixed, annual rate of 10%, with
interest payable monthly and all outstanding principal plus all accrued and
unpaid interest due and payable at maturity. Indebtedness outstanding under
the Exchangeable Notes will be exchangeable, in whole or in part, for
Texoil, Inc. common stock at an initial per share price equal to $1.50,
subject to anti-dilution adjustments. The Company will be able to require
the RIMCO lenders to make such an exchange if the average trading price of
the common stock for any consecutive twenty day trading period is $3.00 or
more. The Company will grant the RIMCO lenders certain registration rights
in respect to the shares of Texoil, Inc. common stock issuable upon exchange
of debt under the Exchangeable Notes. Obligations under the Exchangeable
Notes will be secured by all of the existing and future oil and gas assets
of the Company and Texoil, Inc. will guarantee the Company's obligations
thereunder.
(b) Debt Conversion
Two Texoil, Inc. directors have elected to convert $300,000 of debt into
375,000 shares of Texoil, Inc. common stock effective April 22, 1997. The
$300,000 converted amount is a part of the aggregate $900,000 of convertible
debt issued by Texoil, Inc. in the form of Replacement 12% Convertible Notes
dated September 6, 1996 ("Replacement Notes"). All or any part of the
Replacement Notes may be converted at any time into shares of Texoil, Inc.
common stock at a conversion price of $0.80 per share. Mr. T.W. Hoehn, Jr.,
holder of $550,000 in Replacement Notes, converted $260,000 of debt into
325,000 shares of common stock. Mr. T.W. Hoehn, III, holder of $300,000 in
Replacement Notes converted $40,000 of debt into 75,000 shares of common
stock. Giving effect to the $300,000 debt conversion, the Replacement Notes
aggregate balance of $600,000 is now held by Mr. T.W. Hoehn, Jr. in the sum
of $290,000, Mr. T.W. Hoehn, III in the sum of $260,000 and Mr. William F.
Seagle in the sum of $50,000.
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Item 7. Financial Statements and Exhibits
(a) Financial statement of business acquired - not applicable
(b) Pro Forma Financial Information (Unaudited)
The following unaudited pro forma condensed consolidated balance sheet
as of December 31, 1996 gives effect to the conversion of $300,000 of debt
into 375,000 shares of Texoil, Inc. common stock. The $300,000 converted
amount is a part of the aggregate $900,000 of convertible debt securities
issued by Texoil, Inc. in the form of Replacement Notes. All or any part of
the Replacement Notes may be converted at any time into shares of Texoil,
Inc. common stock at a conversion price of $0.80 per share.
The pro forma information is based on the historical financial
statements of the Registrant. The pro forma adjustments required are to
reduce the notes payable liabilities by $300,000 and to reflect the
corresponding increase in stockholders' equity resulting from the issuance
of 375,000 shares of Texoil, Inc. common stock.
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TEXOIL, INC.
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
December 31, 1996 (Unaudited)
PRO FORMA PRO FORMA
HISTORICAL ADJUSTMENTS CONSOLIDATED
----------- ----------- ------------
ASSETS
Current:
Cash ...................................... $ 1,812 $ 0 $ 1,812
Accounts receivable ....................... 468,359 0 468,359
Other ..................................... 58,457 0 58,457
----------- ----------- -----------
Total current assets ............... 528,808 0 528,808
----------- ----------- -----------
Oil and gas properties, net
(on the basis
of full cost accounting) .................. 4,641,327 0 4,641,327
Other equipment, net ......................... 1,550 0 1,550
Other Assets ................................. 50,222 0 50,222
----------- ----------- -----------
$ 5,221,907 $ 0 $ 5,221,907
----------- ----------- -----------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities .. $ 966,012 $ 0 $ 966,012
Current portion - notes payable ........... 1,194,794 0 1,194,794
----------- ----------- -----------
Total current liabilities .......... 2,160,806 0 2,160,806
----------- ----------- -----------
Notes payable ................................ $ 1,950,000 $ (300,000)(1) $ 1,650,000
Other long-term liabilities .................. 206,359 0 206,359
Commitments and Contingency
Stockholders' equity
Series A preferred stock, $.01 par;
redeemable and convertible with
liquidation preference of $100
per share; 10,000,000 shares authorized;
23,000 shares issued and outstanding ...... 2,300,000 0 2,300,000
Common stock, $.01 par; 50,000,000 shares
authorized; 4,157,073 shares issued and
outstanding at December 31, 1996 .......... 41,571 3,750(1) 45,321
Additional paid-in capital ................... 6,299,629 296,250(1) 6,595,879
Deficit ...................................... (7,736,458) 0 (7,736,458)
----------- ----------- -----------
904,742 300,000(1) 1,204,741
----------- ----------- -----------
$ 5,221,907 $ 0 $ 5,221,907
=========== =========== ===========
Footnote (1) : 375,000 shares of Texoil, Inc. common stock issued upon
conversion of $300,000 of debt convertible at $0.80 per share.
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(c) Exhibits
10.1 RIMCO commitment letter dated April 18, 1997.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to signed on its behalf by the
undersigned, hereunto duly authorized.
TEXOIL, INC.
Date: APRIL 24, 1997 By: /s/ RUBEN MEDRANO
Ruben Medrano
President and Chief
Executive Officer
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