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): March 24, 1997
EuroGas, Inc.
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(Exact Name of Registrant as Specified in its Charter)
Utah 33-1381-D 87-0427676
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(State or other (Commission (IRS Identification
jurisdiction of incorporation File Number) No.)
or organization)
942 East 7145 South, #101A, Midvale, Utah 84047
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(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code: (801) 255-0862
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(Former name, former address, and formal fiscal year, if changed since
last report)
ITEM 2. ACQUISITION AND DISPOSITION OF ASSETS
EuroGas, Inc. (the "Company"), through its wholly-owned subsidiary Pol-Tex
Methane Sp. z.o.o., entered into an agreement with the Polish affiliate of
Texaco, Incorporated ("Texaco"), whereby Texaco will acquire the rights to
appraise, operate, and develop EuroGas' Pol-Tex coal bed methane gas concession,
known as 134/93 (the "Concession"). The transaction also includes the sale of
approximately $200,000 in fixed assets and equipment.
Upon approval of the agreement by the Polish Ministry of Environmental
Protection, Natural Resources and Forestry ("Polish Ministry"), Texaco will make
an initial payment to the Company of $500,000 and conduct a substantial initial
drilling program to appraise the Concession. Drilling and testing will be
completed by Texaco in accordance with a schedule to be approved by the Polish
Ministry and is expected to last approximately 18 months.
At the end of the 18-month period, Texaco can elect to continue to work on
the Concession in exchange for a $2,500,000 payment to the Company. If Texaco
elects to proceed, it has another 18 months to undertake development work on the
Concession and then Texaco must elect whether or not to complete the acquisition
of the Concession. If Texaco elects to proceed, it must pay the Company an
additional $2,500,000 and 14 to 20% of the net profits from production. If
Texaco elects not to proceed, the Company can reacquire the Concession.
In addition, the Company also granted Texaco the first right of refusal to
acquire control of its other coal bed methane concessions in Poland known as MMR
and MMJ, at a price to be determined either by the parties or a third party
appraiser. For now, the Company will continue to operate the MMR and MMJ
concessions.
The Agreement is expected to close on or before June 13, 1997. The
transaction with Texaco is considered a change in form of ownership (from an
operating interest to a non-operating interest with net profit payments) and
therefore has no impact on the financial statements of the Company.
ITEM 7. FINANCIAL STATEMENT AND EXHIBITS
EXHIBITS
SEC
Exhibit Reference
Number Number Title of Document Location
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1 10 Purchase and Sale Agreement between This Filing
Texaco Slask Sp. z.oo., Pol-Tex
Methane Sp. z.o.o. and GlobeGas B.V.
ITEM 9. SALES OF EQUITY SECURITIES PURSUANT TO REGULATION S
On March 28, 1997, the Company sold 500,000 shares of its common stock at a
price of $5.50 per share to Bayerische Landesbank in Frankfurt, Germany for net
proceeds of $2,750,000.
Bayerische Landesbank is the second largest State Bank in Germany
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the Issuer has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
EUROGAS, INC.
Date: April 8, 1997 By /s/ Hank Blankenstein
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Hank Blankenstein, Secretary/Treasurer