- Current report filing (8-K)
March 13 2009 - 3:20PM
Edgar (US Regulatory)
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
9, 2009
TXCO
Resources Inc.
(Exact
name of registrant as specified in its charter)
Delaware
|
0-9120
|
84-0793089
|
(State
of
|
(Commission
File
|
(IRS
Employer
|
incorporation)
|
Number)
|
Identification
No.)
|
777
E. Sonterra Blvd., Suite 350
|
|
San
Antonio, Texas
|
78258
|
(Address
of principal executive offices)
|
(Zip
Code)
|
(210)
496-5300
(Registrant’s
telephone number,
including
area code)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the
registrant
under any of the following provisions (
see
General Instruction A.2.
below):
o
Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
o
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
o
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
o
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
Item
2.04 Triggering
Events That Accelerate or Increase a Direct Financial Obligation or an
Obligation under an Off-Balance Sheet Arrangement.
(a) On
March 9, 2009, Capital Ventures International (“
CVI
”) sent TXCO
Resources Inc. (the “
Company
”) a letter
demanding that the Company redeem 34,409 shares of the Company’s Series D
Convertible Preferred Stock (the “
Series D Preferred
Stock
”) and 15,000 shares of the Company’s Series E Convertible Preferred
Stock (the “
Series E
Preferred Stock
”). CVI is demanding the redemption of its
Series D Preferred Stock and Series E Preferred Stock as a result of the Company
previously disclosing its violation of the current ratio covenant in its Amended
and Restated Credit Agreement, dated April 2, 2007 and as further amended on
July 25, 2007, and Amended and Restated Term Loan Agreement, dated July 25,
2007, each with Bank of Montreal, as lender and administrative agent, and the
other lenders party thereto (collectively, the “
Credit
Facilities
”).
Under the
terms of the Company’s Certificates of Designations, Preferences and Rights of
Series D Convertible Preferred Stock and Series E Convertible Preferred Stock
(collectively, the “
Certificates of
Designations
”), any obligation of the Company to pay CVI the
redemption price (“
Redemption Price
”)
for CVI’s Series D Preferred Stock and Series E Preferred Stock is suspended
until the earlier of (a) October 31, 2012, or (b) the date that all of the
Company’s obligations under the Credit Facilities have been indefeasibly
satisfied. Under the terms of the Certificates of Designations, the
Company is obligated to pay interest at a rate of 1.5% per month in respect of
each unredeemed preferred share until paid in full.
If the
Company were required to pay the Redemption Price today, which it is not, such
price would be approximately $1,404 per share for the Series D Preferred Stock
and approximately $1,440 per share for the Series E Preferred
Stock.
At the
time the Company’s violation of the current ratio covenant constitutes a
“triggering event” under the terms of the Certificates of Designations, the
dividend rate on the Series D Preferred Stock and Series E Preferred Stock each
increases from 6.5% and 6% per annum, respectively, to 12% per annum until such
time the violation of the current ratio covenant is cured.
The
foregoing summary of the terms of the Certificates of Designations does not
purport to be complete and is qualified in its entirety by reference to the
complete text of the Certificates of Designations, which are filed as Exhibits
3.1 and 3.2 hereto.
Item
9.01 Financial
Statements and Exhibits.
(d) Exhibits.
3.1
|
Certificate
of Designations, Preferences and Rights of Series D Convertible Preferred
Stock of the Company (incorporated by reference to Exhibit 3.1 of the
Company’s Current Report on Form 8-K, filed March 7,
2008).
|
3.2
|
Certificate
of Designations, Preferences and Rights of Series E Convertible Preferred
Stock of the Company (incorporated by reference to Exhibit 3.2 of the
Company’s Current Report on Form 8-K, filed March 7,
2008).
|
SIGNATURE
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.
|
|
|
|
TXCO
Resources Inc.
|
|
|
|
|
Dated:
March 13, 2009
|
/s/ P. Mark Stark
|
|
|
P.
Mark Stark
|
|
|
Chief
Financial Officer
|
|
|
(Principal
Accounting and Financial Officer)
|
|
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