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Within the enclosed loose leaf volume is (1) a
listing of the 79 currently producing wells showing the
average monthly production for the first half of 1986
(2) * * * [Excerpts] from the L.A. Martin and
Associates, Inc., "Reserves Estimate and Economic
Analysis" report dated February 17, 1986. Martin's
production history curves have been updated through
June 1986. Also included with the Martin data are
monthly production statistics for each of the 79 wells
from inception to the most recent information
available. (3) Description and location for all of
Tri-Power's leasehold interest both developed and
undeveloped, and; (4) The final section deals with the
four major leased, undrilled prospects in which Tri-
Power has an interest and a listing of unleased,
geologically-geophysically defined prospects.
* * * * * * *
[Tri-Power] will sell all of its U.S. producing
properties for $10,500,000.00 with a minimum of
$500,000.00 to be paid in cash with assumption by Buyer
of * * * [Tri-Power's] $10,000,000.00 U.S. bank debt,
but reserving to * * * [TPC] a 20% net profit interest
in the properties on a project basis. This would
result in * * * [TPC] backing in for a 20% net profit
interest after Buyer recovers all of his costs out of
production from the sold properties.
Previously, on August 18, 1986, TPC had made a similar offer
to United Oil and Minerals. In both instances, TPC offered to
sell only the stock of Tri-Power, not its individual assets.
Shortly after TPC's offer to petitioner, on October 10,
1986, Bonanza merged into Tri-Power.
B. Petitioner's Examination of Tri-Power's Properties
Upon receiving the offer from TPC, petitioner's acquisition
team began investigating the Tri-Power properties. Petitioner's
acquisition team studied not only the 1986 LAM reserve report,
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