UNITED STATES
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): June 22, 2007
TRANS ENERGY, INC.
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(Exact name of registrant as specified in its charter)
NEVADA 0-23530 93-0997412
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
210 Second Street, P.O. Box 393, St. Mary's, West Virginia 26170
(Address of principal executive offices)
Registrant's telephone number, including area code: (304) 684-7053
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:
[ ] Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17
CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
FORM 8-K
Section 1 - Registrant's Business and Operations
Item 1.01 Entry into a Material Definitive Agreement.
On June 22, 2007, Trans Energy, Inc. announced that it had finalized a
financing agreement with CIT Capital USA Inc. Under the terms of the agreement,
CIT will fully underwrite $18.0 million in financing for Trans Energy in the
form of a senior secured revolving credit facility ("Revolving Credit Facility"
or "Revolver"). Trans Energy will also have the ability to increase the credit
facility to $30.0 million in the future with increases in its reserves.
Funds realized from the financing agreement will be used to facilitate the
company's 2007 drilling program. Trans Energy has begun drilling the first of up
to 30 wells the company plans to drill during 2007 and has contracted for a
drilling rig to be used for the balance of the year, with an option to extend
through 2008.
As compensation for CIT's services, Trans Energy agrees to (i) pay CIT a
closing fee in the amount of $200,000, and (ii) grant CIT a 2% net profits
interest in and to all of Trans Energy's oil and gas properties currently owned
and any additional oil and gas property acquired. Also, Trans Energy will pay
CIT an additional fee equal to 1.25% on any increases in the borrowing base over
the initial amount of $18.0 million. Further, Trans Energy agrees to reimburse
CIT for all reasonable out-of-pocket fees and expenses such as legal counsel,
consultants, appraisers, travel and accommodations incurred in connection with
the transaction.
The term of the financing agreement is three years. Throughout the life of
the agreement, Trans Energy may borrow, repay and reborrow funds so long as the
sum of the aggregate loans outstanding at any time, plus the aggregate face
amount of any letters of credit, does not exceed the initial base of $18.0
million, which can be increased to $30.0 million. Trans Energy will also pledge
as collateral for the loans certain oil and gas properties and related assets
and interests.
Section 9 - Financial Statements and Exhibits
Item 9.01 Financial Statements and Exhibits.
(c) Exhibits
Exhibit No. Description
10.1 Credit Agreement with CIT Capital USA Inc.
99.1 Press Release dated June 22, 2007
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Notes about Forward-looking Statements
Statements contained in this current report that are not historical facts,
including all statements regarding the consummation of the acquisition of
assets, may be considered "forward-looking statements" under the Private
Securities Litigation Reform Act of 1995. Forward-looking statements are based
on current expectations and the current economic environment. Trans Energy
cautions the reader that such forward-looking statements are not guarantees of
future performance. Unknown risks and uncertainties as well as other
uncontrollable or unknown factors could cause actual results to materially
differ from the results, performance or expectations expressed or implied by
such forward-looking statements.
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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.
TRANS ENERGY, INC.
Date: June 22, 2007 By /S/ JIM ABCOUWER
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Jim Abcouwer
President
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