NEWS JUST OUT! HERE IT IS:
Monday June 1, 11:30 am Eastern Time
Company Press Release
Letter To the Stockholders of North American Exploration Corporation
SEATTLE--(BUSINESS WIRE)--June 1, 1998
Dear Stockholders:
Your Board of Directors would like to apprise you of recent developments concerning North American Exploration
Corporation, a Florida Corporation (the ''Company'').
Removal of Director and Executive Officer
On March 29, 1998, at a special meeting of the Board of Directors, and pursuant to the Bylaws of the Company, Paul A.
Ebeling was removed as a director and executive officer of the Company; Michael E. Stamm, the Company's Chairman, was
elected as interim Treasurer; John F. Bates, Esq., General Counsel to the Company, was elected as Corporate Secretary; and
George P. Ziller was designated as a Director; each to fill vacancies created by the removal of Mr. Ebeling. Mr. Ebeling did not
attend the meeting.
The Board of Directors further resolved to authorize the President of the Company to begin a formal search for a person to
serve as the Company's Treasurer.
On March 30, 1998, Mr. Ebeling formally tendered his resignation to the Company.
Mr. Ebeling's removal as a director and executive officer of the Company was based upon: ( i ) the inability of the Company to
find necessary documentation to verify appropriate exemptions from the registration requirements of federal and state securities
laws, rules and regulations for the offer and sale of a substantial number of shares of common stock issued by the Company for
cash, assets, and services; and ( ii ) a similar lack of documentation respecting the accounting of these proceeds, assets, and
services. The investigation conducted on behalf of the Company by an independent law firm also disclosed potential stock
issuances for less than fair value. All of these matters were within the purview of Mr. Ebeling's responsibilities.
The Company has placed ''stop transfer'' instructions with its transfer and registrar agent respecting a substantial number of
shares of common stock issued during the relevant period, and expects to require the holders of these securities to verify
payment of fair value for these securities to the Company, prior to the removal of these instructions. Unless it is determined that
such shares were duly authorized to be issued by the Board of Directors and the purchasers' thereof acted in good faith, the
Company will do everything within its power to cause such securities to be canceled.
Presently, the Company is attempting to obtain an accounting for all funds received from the sale of its securities, including the
use of such proceeds for the benefit of the Company, and to determine if there are any other claims respecting subscriptions to
purchase shares of the Company's common stock. Once this is completed, your Board of Directors will consider remedies
available to the Company and discuss what steps can be taken with counsel. You will be apprised of these developments.
There are currently 144 million outstanding shares of common stock, and the Company has placed ''stop transfer'' instructions
on stock certificates representing approximately 60 million shares.
Business Development
On March 29, 1998, every contract the Company had was in default for non-payment. The Company had more than
$400,000 (US) in unpaid trade debt. A lien had been formally filed on six wells in Nebraska, which were in various states of
completion, by the drilling company.
Since March 29th the following has been accomplished. Stop gap finance, in the amount of $700,000.(US), was obtained from
foreign sources to stabilize the Company. The trade debt was paid and the lien on the wells was removed. Over the traditional
Easter break, a team of financiers was assembled from Europe, the United States and Australia to meet with legal counsel in
Los Angeles and plan the continuation of the Company longer term. The longer term plan involves the completion of all six of
the new Porter Field wells in Nebraska, as well as continuation of the drilling to a total of sixty wells on this structure;
re-entering the Carroll and Rother Wells in Colorado; and beginning the Southeast Colorado Project.
Currently, in Nebraska, the gas gathering system construction is complete. Natural gas is being sold from two wells, and eight
of the Porter Field wells are in the process of being hooked up to the gathering system to sell natural gas. Financing
commitments have been obtained such that the longer term plan may be accomplished. On June 15, 1998, the drilling of three
additional wells in Nebraska will commence. As soon as the driller can begin thereafter, fourteen more wells will be spudded.
The Rother well will be reopened in late June as the beginning of the Southeast Colorado Project.
As for the future, the Board of Directors is currently doing, and will continue to do everything possible to make sure that the
company survives and prospers- and most importantly that the Shareholders' interests are preserved. The Company is being
run according to very proper and conservative principles. Information from the company will be provided via press releases
and will be extremely factual. There are many issues and problems that need to be resolved. To resolve them takes time,
patience and the understanding of you, the Shareholders. The Board of Directors is currently working to put a top caliber
management team in place so that together with your support, we will have a growing and prosperous Company that rewards
you, the Shareholder. Please do not forget, the members of the management team are Shareholders too.
I thank you for being shareholders.
Michael E. Stamm
Chairman and CEO
North American Exploration Corporation.
This information, other than historical financial information, consists of forward-looking statements that involve risks and
uncertainties including planned construction, drilling activity, expected production efforts,volumes, budgeted capital
expenditures and other risks and uncertainties. Actual results may vary materially.
Contact:
North American Exploration Corporation., Seattle, WA.
Voice: (206) 326-5468
Fax: (206) 326-5469
or
Investor Relations Contact:
ML/Communications
Voice: (716) 442-2790
Fax: (716) 442-3227
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