-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Ukmor8aEuTo7dJ2MiqMcCExPrWGOR2sDvJmZepeL/cm+yRKP9sDG5PQhvuEigQGg Pjx/snXHeWcyh9DFK+4Hbg== 0001050502-04-000271.txt : 20040519 0001050502-04-000271.hdr.sgml : 20040519 20040519125921 ACCESSION NUMBER: 0001050502-04-000271 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20040517 ITEM INFORMATION: Changes in control of registrant ITEM INFORMATION: FILED AS OF DATE: 20040519 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CHAPARRAL RESOURCES INC CENTRAL INDEX KEY: 0000019252 STANDARD INDUSTRIAL CLASSIFICATION: CRUDE PETROLEUM & NATURAL GAS [1311] IRS NUMBER: 840630863 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-07261 FILM NUMBER: 04818008 BUSINESS ADDRESS: STREET 1: 2 GANNETT DRIVE CITY: WHITE PLAINS STATE: NY ZIP: 10604 BUSINESS PHONE: 2818777100 MAIL ADDRESS: STREET 1: 2 GANNETT DRIVE CITY: WHITE PLAINS STATE: NY ZIP: 10604 8-K 1 chaparral8k.txt 8-K ================================================================================ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------------ FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITES EXCHANGE ACT OF 1934 Date of report (Date of earliest event reported): May 17, 2004 CHAPARRAL RESOURCES, INC. (Exact Name of Registrant as Specified in Charter) DELAWARE 0-7261 84-0630863 (State or Other Jurisdiction (Commission (IRS Employer of Incorporation) File Number) Identification No.) 2 Gannett Drive, Suite 418 White Plains, New York 10604 (Address of Principal Executive Offices) (Zip Code) Registrant's telephone number, including area code: (866) 559-3822 ================================================================================ Item 1. Changes in Control of Registrant. On May 17, 2004, Chaparral Resources, Inc., the "Company", issued a press release announcing that Nelson Resources Limited (TSX: NLG) has acquired from Central Asian Industrial Holdings N.V. a majority interest in the Company. A copy of the press release is being furnished as Exhibit 99.1 to this Form 8-K. Item 12. Results of Operations and Financial Condition. On May 17, 2004, the Company issued a press release announcing its financial results for the first quarter ended March 31, 2004. A copy of the press release is being furnished as Exhibit 99.1 to this Form 8-K. This information, including the exhibit related hereto, shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any disclosure document of the Company, except as shall be expressly set forth by specific reference in such document. SIGNATURES 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 hereunto duly authorized. CHAPARRAL RESOURCES, INC. Date: May 19, 2004 By: /s/ Simon Gill --------------------------- (Signature) Simon Gill Chief Executive Officer Exhibit Index Exhibit Number Description - ------ ----------- *99.1 Press release dated May 17, 2004 announcing change of control and financial results for the quarter ended March 31, 2004 - ---------- * Filed herewith EX-99.1 2 chaparral99-1.txt PRESS RELEASE EXHIBIT 99.1 CHAPARRAL CHAPARRAL RESOURCES, INC. ================================================================================ NEWS RELEASE ***For Immediate Release*** For further information: ------------------------ Janna Aidar 866-559-3822 CHAPARRAL RESOURCES, INC. ANNOUNCES CHANGE IN CONTROL AND FIRST QUARTER 2004 RESULTS - ---------------------------------------------------------------------------- WHITE PLAINS, NY, MAY 17, 2004 -- CHAPARRAL RESOURCES, INC. (OTCBB: CHAR) today announced that Nelson Resources Limited (TSX: NLG) ("Nelson") has acquired from Central Asian Industrial Holdings N.V. ("CAIH") a majority interest in the Company. Nelson has purchased from CAIH 22,925,701 shares of Chaparral (the "Shares"), representing 60% of Chaparral's issued and outstanding common stock, a Stock Purchase Warrant exercisable for an additional 3,076,923 shares of common stock of Chaparral (the "Warrant"), and a promissory note of Chaparral payable to CAIH (the "CAIH Note"), with a principal amount of US$4 million for an aggregate purchase price of US$23.9 million. In consideration for the Shares, the Warrant and the CAIH Note, Nelson has issued a promissory note (the "Nelson Note") in the principal amount of US$23.9 million payable to CAIH. The Nelson Note has a term of one year and bears interest at 10.5% per annum, payable at maturity. Nelson now owns 60% of the issued and outstanding shares of Chaparral (55.53% on a fully diluted basis). The shares of common stock issuable under the Warrant would, assuming no other issuance of shares of common stock of Chaparral, upon the full exercise of the Warrant, constitute approximately 7.45% of the issued and outstanding shares of Chaparral on a fully diluted basis. This would give Nelson ownership of 62.98% of the issued and outstanding shares of Chaparral on a fully diluted basis. The number of members of the Board of Directors of Chaparral will not change as a result of the transaction. Following the completion of the transaction two of the six directors of Chaparral, Mr. Nikolai Klinchev and Mr. John Duthie, resigned. Mr. Klinchev also resigned as Chief Executive Officer of Chaparral. Messrs. Klinchev and Duthie have been replaced on the Board by Mr. Frederick Hodder, Chief Financial Officer of Nelson, who has also been appointed Chairman of Chaparral, and Mr. Simon Gill, who has also been appointed Chief Executive Officer of Chaparral. In addition, following the completion of the transaction, Mr. Jonathan Wood resigned as VP-Finance and Chief Financial Officer of Chaparral, and was replaced by Mr. Miguel Soto, Chaparral's current Treasurer and Financial Controller. Going forward, Mr. Soto will serve as Chaparral's VP-Finance and Chief Financial Officer, and will also continue as Treasurer. Other than the replacement of the Chief Executive Officer and the Chief Financial Officer, the current executive officers of Chaparral will continue in their capacities pending a review of operations by the newly constituted Board of Directors. ~~ more ~~ ================================================================================ 2 Gannett Drive o White Plains o New York 10604 866-559-3822 o 866-700-5091 Fax www.ChaparralResources.com Chaparral Resources, Inc. News Release May 17, 2004 Page 2 The Company also reported a net income of $634,000, or 2 cents per share, for the quarter ended March 31, 2004, compared to a net income of $49,000, or nil cents per share, for the quarter ended March 31, 2003. The $585,000 increase in our net income primarily relates to the net of higher sales revenue and related operating expenses as a result of higher sales volumes, offset by the absence in the first quarter of 2004 of the one time gain, the result of the adoption of SFAS 143, reported in the first quarter of 2003. Revenues were $15.6 million for the first quarter of 2004 compared with $7.81 million for the first quarter of 2003. The $7.8 million increase is the result of higher oil export sales quota received during the first quarter 2004 and higher oil prices received during the first quarter 2004 as compared to the same period of 2003. During the first quarter 2004, the Company sold approximately 721,000 barrels of crude oil, recognizing $15.6 million, or $21.65 per barrel, in revenue. Comparably, the Company sold approximately 364,000 barrels of crude oil, recognizing $7.81 million in revenue, or $21.47 per barrel, for the first quarter 2003. Transportation costs for the first quarter 2004 were $3.15 million, or $4.37 per barrel, and operating costs associated with sales were $2.21 million, or $3.07 per barrel. Comparatively, transportation costs for the first quarter 2003 were $1.66 million, or $4.57 per barrel, and operating costs associated with sales were $1.12 million, or $3.08 per barrel. The decrease in transportation cost is caused by lower volumes held in the pipeline pending sale, while operating costs per barrel remained at the same level. Interest expense increased from $1.12 million for the first quarter 2003 to $1.23 million for the first quarter 2004, due to higher financing costs as a result of additional temporary borrowings for operational purposes and less capitalized interest. The Company has agreed with Kazkommertsbank to defer a principal payment of $1 million originally due on February 6, 2004, under the non-revolving portion of the KKM Credit Facility, until May 31, 2004. As of May 10, 2004, our daily oil production is approximately 8,500 barrels per day from 45 of the 49 productive wells in the field. The remaining 4 wells are shut-in for various reasons including completion operations, installation of additional gathering lines / equipment, bottom hole pressure readings, formation pressure surveys, and additional workover, water injection and stimulation operations to bring wells on production. During the first quarter 2004, one producing well was converted to water injection making a total of 5 water injection wells, of which one was operational with four awaiting commissioning of the water injection facility. The water injection facility was commissioned during April 2004. In addition, as of March 31, 2004, the water supply well count had risen to 5 water source wells from 3 water source wells as of December 31, 2003. During the first quarter of 2004, 9 wells were converted to artificial lift (8 using sucker rod pumps and 1 using electrical submersible pumps). ================================================================================ 2 Gannett Drive o White Plains o New York 10604 866-559-3822 o 866-700-5091 Fax www.ChaparralResources.com Chaparral Resources, Inc. News Release May 17, 2004 Page 3 FINANCIAL HIGHLIGHTS -------------------- (in thousands, except per share data) For the three months ended March 31 ---------------------------- 2004 2003 ------------ ------------ Revenue $ 15,609 $ 7,813 Costs and expenses (11,498) (6,723) Other expense (2,335) (1,707) Income tax expense (1,142) (352) Cumulative effect of change in accounting principle -- 1,018 ------------ ------------ Net income available to common stockholders $ 634 $ 49 ============ ============ Basic and diluted earnings per share: Net income per share $ 0.02 $ 0.00 ============ ============ Weighted average number of shares outstanding (basic and diluted) 38,209,502 38,209,502 ============ ============ Information Regarding Forward-Looking Statements: Except for historical information contained herein, the statements in this Press Release are forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties, which may cause the Company's actual results in future periods to differ materially from forecasted results. These risks and uncertainties include, among other things, volatility of oil prices, product demand, market competition, risks inherent in the Company's international operations, imprecision of reserve estimates and Chaparral's ability to replace and expand oil and gas reserves. These and other risks are described in the Company's Annual Report on Form 10-K and other filings with the Securities and Exchange Commission. ### ================================================================================ 2 Gannett Drive o White Plains o New York 10604 866-559-3822 o 866-700-5091 Fax www.ChaparralResources.com -----END PRIVACY-ENHANCED MESSAGE-----