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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
F O R M 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report
September 27, 1995
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Rio Grande, Inc.
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(Exact name of registrant as specified in its charter)
Delaware
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(State or other jurisdiction of incorporation)
1-8287 74-1973357
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(Commission File Number) (I.R.S. Employer Identification Number)
10101 Reunion Place, Suite 210
San Antonio, Texas 78216-4156
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(210) 308-8000
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ITEM 5. OTHER EVENTS.
The Company consummated on September 27, 1995 an offering (the
"Offering") of 80 Units, each of which consists of an 11.50% Subordinated Note
in the principal amount of $25,000 ("Note" where singular and "Notes" where
plural) and Warrants to purchase shares of Class A Common Stock, par value $.01
per share, of the Company (the "Common Stock") at $.40 per share, as described
below (the "Warrants").
Interest on the Notes is payable quarterly, and the Notes mature on
September 30, 2000. No principal payments will be required during the first
two years. Thereafter, quarterly principal installments equal to 3.125%,
9.375% and 12.5% of the original principal amount of the Notes are payable
during the third, fourth and fifth years, respectively. The Notes may be
prepaid in whole or in part at any time without penalty.
The Warrants entitle the holder to acquire shares of Common Stock of
the Company at $.40 per share for a period of seven years, subject to earlier
expiration under certain circumstances. 1,388,160 shares of Common Stock are
subject to the Warrants. The Warrants are detachable from the Notes; provided,
however, that if the Warrants are transferred separately from the Notes to
someone other than an affiliate, they must be exercised within thirty days of
the assignment or transfer or they will expire. Warrant holders were granted
piggyback registration rights entitling the holders of shares acquired through
the exercise of Warrants to request registration of those shares in the event
the Company files a registration statement to effectuate a public offering of
the Company's Common Stock.
The Company paid a fee of 4.25%, or $85,000 of the proceeds to
Duncan-Smith Securities, Inc. The Company estimates that the other expenses of
the Offering, including printing, legal and engineering fees and expenses
payable by the Company, will be approximately $60,000, which would provide
$1,855,000 to the Company. The Company intends to use the proceeds of the
Offering to initiate a plan of development on and make production enhancements
to certain oil and gas properties acquired in 1994 and operated by the Company.
The Company's development plan includes the recompletion or workover of
approximately 20 marginal producing wells and an infill development drilling
program combined with a pressure maintenance waterflood project on
approximately 4,000 acres in Tom Green County, Texas.
The securities were offered and sold pursuant to a Private Offering
Memorandum, a copy of which has been filed as an exhibit to this report. The
Note Purchase Agreement by and among the Company, Rio Grande Drilling Company,
a Texas corporation and wholly-owned subsidiary of the Company, and the various
purchasers in the offering and the form of Warrant issued to purchasers in the
offering are also attached as exhibits to this report.
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ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits. The following exhibits are filed as part of this report:
Number Document
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4.1 Note Purchase Agreement, dated September 27, 1995, by and among the Company, Rio Grande
Drilling Company, and the various purchasers of 11.50% Subordinated Notes due September 30,
2000
4.2 Form of Common Stock Purchase Warrant issued in connection with the Offering described in this
report
99.1 Private Offering Memorandum of the Company dated August 7, 1995
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SIGNATURES
Pursuant to the requirement 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.
RIO GRANDE, INC.
By:
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Guy Bob Buschman, President
Dated: ____________, 1995
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EXHIBIT INDEX
Exhibit No. Description Sequentially Numbered Page
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4.1 Note Purchase Agreement, dated ____
September 27, 1995, by and among the
Company, Rio Grande Drilling
Company, and the various purchasers
of 11.50% Subordinated Notes due
September 30, 2000
4.2 Form of Common Stock Purchase ____
Warrant issued in connection with
the Offering described in this
report
99.1 Private Offering Memorandum of the ____
Company dated August 27, 1995
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