SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT: FEBRUARY 14, 2002
(Date of earliest event reported)
WARREN RESOURCES INC.
(Exact name of registrant as specified in its charter)
New York 0-33275 11-3024080
(State or other jurisdiction (IRS Employer
of incorporation) (Commission File Number) Identification No.)
489 FIFTH AVENUE, 32ND FLOOR, NEW YORK, NEW YORK 10017
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(Address of principal executive offices including Zip Code)
Registrant's telephone number, including area code: (212) 697-9660
_________________________
(Former name or former address, if changed since last report)
This Current Report on Form 8-K is filed by Warren Resources Inc., a New York
corporation (the "Company"), in connection with the matters described herein.
ITEM 5. OTHER EVENTS.
On February 14, 2002 (the "Closing Date"), CJS Pinnacle Petroleum Services, LLC,
a Texas limited liability company and an indirect subsidiary of the Company
("Pinnacle"), completed the sale of substantially all of its assets, excluding
any revenues generated prior to the Closing Date, cash held prior to December
31, 2001 (the "Effective Date") and accounts receivables for services rendered
prior to the Closing Date (the "Assets"), for a purchase price of up to $4.2
million to Basic Energy Services, Inc., a Texas corporation ("Basic Energy").
Pursuant to the Asset Purchase Agreement, dated as of the Effective Date,
between Pinnacle and Basic Energy (the "Purchase Agreement"), Basic Energy paid
Pinnacle (i) $3.7 million in cash at the closing, and (ii) up to $500,000 in
contract drilling services credits, which may be utilized by Pinnacle for future
oil and gas well workovers, completions, swabbing operations, plugging and
abandonment operations, or any related well servicing operations to be performed
by Basic Energy at the request of the Company or Petroleum Development
Corporation, a wholly owned subsidiary of the Company, within 36 months from the
Closing Date in increments no greater than $25,000, per month, plus during the
last 18 months of this period, a 50% discount for services in excess of $25,000
per month. The credit is to be provided at Basic Energy's rate schedule and
prices in effect from time to time. Pursuant to a Bill of Sale, Transfer and
Assignment, dated and executed on the Closing Date, to be effective as of the
Effective Date (the "Bill of Sale"), Pinnacle transferred the Assets to Basic
Energy without warranty of title of any kind or type, express or implied.
Additionally, Pinnacle and Basic Energy entered into a Non-Competition
Agreement, dated the Closing Date (the "Non-Competition Agreement"), wherein
Pinnacle agreed that it would not compete in the Business (as hereinafter
defined) of Basic Energy within a 200-mile radius of Pinnacle's offices in
Beeville, Texas and Artestia, New Mexico for a period of three years from the
Closing Date. The term "Business" is defined to mean the oil and gas well
workover, completion, plugging, abandonment, and related oil and gas well
servicing businesses as theretofore conducted by Pinnacle in Beeville, Texas and
Artesia, New Mexico, and the provision of all goods and services incidental
thereto.
A copy of the Purchase Agreement, the Non-Competition Agreement and the Bill of
Sale, each of which is incorporated by reference herein and made a part hereof,
is filed with this Current Report on Form 8-K as Exhibit 2, 10.1 and 10.2,
respectively.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits.
2 Asset Purchase Agreement, dated as of December 31,
2001, by and between CJS Pinnacle Petroleum Services,
LLC and Basic Energy Services, Inc.
2
10.1 Non-Competition Agreement, dated February 14, 2002, by
and between CJS Pinnacle Petroleum Services, LLC and
Basic Energy Services, Inc.
10.2 Bill of Sale, Transfer and Assignment, dated and
executed on February 14, 2002, to be effective as of
December 31, 2001, made by CJS Pinnacle Petroleum
Services, LLC, for benefit of Basic Energy Services,
Inc.
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Signature
Pursuant to the requirements of the Securities Exchange Act of 1934, Warren
Resources Inc. has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
WARREN RESOURCES INC.
Date: February 28, 2002 By: /s/ Norman F. Swanton
Norman F. Swanton,
Chairman and Chief Executive Officer
and Duly Authorized Officer
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Exhibit Index
2 Asset Purchase Agreement, dated as of December 31,
2001, by and between CJS Pinnacle Petroleum Services,
LLC and Basic Energy Services, Inc.
10.1 Non-Competition Agreement, dated February 14, 2002, by
and between CJS Pinnacle Petroleum Services, LLC and
Basic Energy Services, Inc.
10.2 Bill of Sale, Transfer and Assignment, dated and
executed on February 14, 2002, to be effective as of
December 31, 2001, made by CJS Pinnacle Petroleum
Services, LLC, for benefit of Basic Energy Services,
Inc.
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