Explanatory Note:
Tidelands Oil & Gas Corporation hereby files this Amendment No. 1 to
its Current Report on Form 8-K, filed with the Securities and Exchange
Commission (the “SEC”) on April 4, 2008, in order to provide
additional information regarding the terms and conditions, including the total
purchase price and the entry into a Throughput
Payment Agreement, relating to the Purchase and Sale Agreement described
such previously filed Current Report. The information contained in
the Company’s Current Report on Form 8-K, filed with the SEC on
April 4, 2008, is hereby incorporated by reference in its
entirety.
ITEM
1.01 Entry into a Material Definitive
Agreement
As
previously reported in the Company’s Current Report on Form 8-K, filed with the
SEC on April 4, 2008, on March 25, 2008, Reef Ventures, L.P. (“Reef
Ventures”), a subsidiary of Tidelands Oil & Gas Corporation (the “Company”),
entered into and consummated a Purchase and Sale Agreement (the “Purchase and
Sale Agreement”) with West Texas Gas, Inc. (“WTG”) for the sale of all of the
issued and outstanding membership interests of Reef International, L.L.C. (“Reef
International”) and Reef Marketing, L.L.C. (“Reef Marketing”, and collectively
with Reef Ventures and Reef International, the “Reef Entities”), both of which
were wholly-owned subsidiaries of Reef Ventures, and all the assets of the Reef
Entities, which consist of assets related to the “River Crossing Project”, the
“Carrizo Springs Pipeline System”, the “Peña Creek Gathering System” and the
“Chittim Gas Plant” collectively referred to as the “Assets”).
The
total purchase price for the Assets, after adjustments required by the Purchase
and Sale Agreement, was $2,484,265 (the “Purchase Price”), and the execution by
WTG of a Throughput Payment Agreement (the “Throughput Payment Agreement”) with
Impact International, L.L.C. (“Impact”).
The
Company caused Reef Ventures to deliver $2,436,825 of the Purchase Price to
Impact on behalf of the Company, as partial
repayment of the outstanding principal and interest of a promissory note made by
the Company to Impact dated May 25, 2004, in the original principal amount of
$6,523,773.30 (the “Note”). The Company repaid the remainder of the
outstanding principal and interest on the Note by requiring WTG to enter into
the Throughput Payment Agreement with Impact for which Impact credited the
outstanding Note balance $876,231 and by issuing 39,890,180 shares (the “New
Shares”) of the Company’s common stock valued at $0.05 per share or a total of
$1,994,509 to Impact upon the closing of the Purchase and Sale
Agreement. The total consideration described above of $5,307,505
liquidated the outstanding Note balance in full. The remaining
$47,440 of the Purchase Price received by Reef Ventures was used to pay legal
fees associated with the transaction and for working capital
purposes.
The
foregoing summary of the terms of the Purchase and Sale Agreement and the Throughput Payment Agreement is qualified in its
entirety by reference to the full and complete terms of such agreements, which
are attached hereto as Exhibits 10.1 and 10.2. The Purchase and Sale
Agreement attached hereto as Exhibit 10.1 replaces in its entirety the Purchase
and Sale Agreement attached as Exhibit 10.1 to the Company’s Current Report on
Form 8-K, filed with the SEC on April 4, 2008.
ITEM
9.01 Financial Statements and Exhibits
The
following exhibits are to be filed as part of this 8-K:
EXHIBIT
NO. IDENTIFICATION
OF EXHIBIT
10.1 Purchase
and Sale Agreement
10.2 Throughput Payment
Agreement
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.
TIDELANDS OIL &
GAS CORPORATION
By: /s/ James B.
Smith
James B. Smith,
President &
Chief Executive
Officer
DATE: April 9,
2008