U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED MARCH 31, 1997
[ ] Transition report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
COMMISSION FILE NO. 0-21841
3DX TECHNOLOGIES INC.
(Exact name registrant as specified in Charter)
DELAWARE 76-0386601
(State or other jurisdiction of (IRS Employer
Incorporation or organization) Identification Number)
12012 WICKCHESTER, SUITE 250
HOUSTON, TEXAS 77079
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (281) 579-3398
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No
---- ----
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Class Outstanding
Common Stock, par value $0.01 per share 7,216,177 shares as of April 30, 1997
3DX TECHNOLOGIES INC.
INDEX
PART I. FINANCIAL INFORMATION Page
Item 1. Financial Statements
Balance Sheets
December 31, 1996 and March 31, 1997 (unaudited)............. 3
Statements of Operations for the
Three Months Ended March 31, 1996 and 1997 (unaudited)....... 4
Statements of Changes in Common Stockholders' Equity (Deficit)
for the Year Ended December 31, 1996 and for the Three Months
Ended March 31, 1997 (unaudited)............................. 5
Statements of Cash Flows for the
Three Months Ended March 31, 1996 and 1997 (unaudited)....... 6
Notes to Financial Statements................................ 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations.......................... 8
PART II. OTHER INFORMATION
Item 1. Legal Proceedings............................................ 12
Item 2. Changes in Securities........................................ 12
Item 3. Defaults Upon Senior Securities.............................. 12
Item 4. Submission of Matters to a Vote of Security Holders.......... 12
Item 5. Other Information............................................ 12
Item 6. Exhibits and Reports on Form 8-K............................. 12
SIGNATURES........................................................... 13
Index to Exhibits.................................................... 14
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3DX TECHNOLOGIES INC.
BALANCE SHEETS
ASSETS
DECEMBER 31, MARCH 31,
1996 1997
------------- -----------
(Unaudited)
Current assets:
Cash and cash equivalents........................ $17,521,745 $ 16,257,886
Accounts receivable.............................. 554,210 515,827
Prepaid expenses................................. 165,095 152,435
----------- ------------
Total current assets............................ 18,241,050 16,926,148
----------- ------------
Property and equipment:
Oil and gas properties (full-cost method-
including $4,403,165 and $8,409,266,
respectively, not subject to depletion,
depreciation and amortization).................. 11,567,562 15,669,723
Technical interpretation equipment............... 1,505,534 2,090,125
Office furniture, equipment and
leasehold improvements.......................... 205,531 243,612
----------- ------------
Less accumulated depletion,
depreciation and amortization................... (4,702,296) ( 5,127,512)
----------- ------------
8,576,331 12,875,948
Other assets:
Deposits......................................... 7,886 7,886
Organization costs, net of accumulated
amortization.................................... 1,922 1,438
----------- ------------
$26,827,189 $ 29,811,420
=========== ============
LIABILITIES AND
COMMON STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable................................. $ 1,960,984 $ 1,200,485
Accrued liabilities.............................. 292,581 143,398
----------- ------------
Total current liabilities....................... 2,253,565 1,343,883
----------- ------------
Common stockholders' equity:
Common stock, $.01 par value,
20,000,000 shares authorized,
6,841,177 and 7,216,177 shares issued
and outstanding, respectively................... 68,412 72,162
Paid-in capital.................................. 34,189,700 38,081,259
Deferred compensation related to
certain stock options........................... (893,040) ( 853,978)
Accumulated deficit.............................. (8,791,448) ( 8,831,906)
----------- ------------
Total common stockholders' equity............... 24,573,624 28,467,537
----------- ------------
$26,827,189 $ 29,811,420
=========== ============
The accompanying notes are an integral part of these financial statements.
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3DX TECHNOLOGIES INC.
STATEMENTS OF OPERATIONS
(Unaudited)
THREE MONTHS ENDED MARCH 31,
----------------------------
1996 1997
-------------- ------------
Revenues:
Oil and gas....................................... $ 94,563 $ 672,270
Rental income..................................... 12,710 84,503
Interest and other................................ 88,747 167,003
---------- ----------
Total revenues................................... 196,020 923,776
---------- ----------
Costs and expenses:
Lease operating................................... 8,933 41,065
Production and ad valorem taxes................... 5,777 50,019
Impairment of oil and gas properties.............. 203,918 -
Depletion, depreciation, and amortization......... 138,481 425,699
General and administrative........................ 292,050 447,451
---------- ----------
Total costs and expenses......................... 649,159 964,234
---------- ----------
Net loss........................................... ( 453,139) ( 40,458)
Dividends on preferred stock....................... ( 171,584) -
Accretion on preferred stock....................... ( 13,711) -
---------- ----------
Net loss applicable to common stockholders......... $( 638,434) $ ( 40,458)
========== ==========
Primary and fully diluted net loss per
common share...................................... $ (.20) $ (.01)
========== ==========
Weighted average number of common
shares outstanding................................ 3,148,825 7,112,010
========== ==========
The accompanying notes are an integral part of these financial statements.
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3DX TECHNOLOGIES INC.
STATEMENTS OF CHANGES IN COMMON STOCKHOLDERS' EQUITY (DEFICIT)
(Unaudited from January 1, 1997 through March 31, 1997)
COMMON STOCKHOLDERS' EQUITY (DEFICIT)
--------------------------------------------------------------------------------------------------
COMMON STOCK STOCK
-------------------- PAID-IN DEFERRED ACCUMULATED SUBSCRIPTIONS
SHARES AMOUNT CAPITAL COMPENSATION DEFICIT RECEIVABLE TOTAL
--------- --------- ----------- ------------- -------------- ------------------ ------------
Balance at December 31, 1995..... 2,987,908 $29,879 $ 1,730,459 $(837,864) $ (5,115,037) $(47,756) $(4,240,319)
Principal collections............ - - - - - 47,756 47,756
Shares issued for exercise
of stock options................ 3,124 31 573 - - - 604
Accrual of dividends............. - - - - (520,393) - (520,393)
Accretion on preferred stock..... - - - - (54,844) - (54,844)
Deferred compensation related
to certain stock options........ - - 922,806 (922,806) - - -
Compensation expense related
to certain stock options........ - - - 867,630 - - 867,630
Shares issued for Initial
Public Offering (net of
offering costs)................. 2,400,000 24,000 23,539,064 - - - 23,563,064
Conversion of Series C
preferred to common stock....... 1,450,145 14,502 7,996,798 - - - 8,011,300
Redemption premium paid on
Series B preferred stock........ - - - - (365,810) - (365,810)
Net loss......................... - - - - (2,735,364) - (2,735,364)
--------- ------- ----------- --------- ------------ -------------- -----------
Balance at December 31, 1996..... 6,841,177 68,412 34,189,700 (893,040) (8,791,448) - 24,573,624
Shares issued to cover
over-allotments from Initial
Public Offering (net of
offering costs)................. 375,000 3,750 3,795,451 3,799,201
Deferred compensation related
to certain stock options........ 96,108 (96,108) -
Compensation expense related
to certain stock options........ - - - 135,170 - - 135,170
Net loss......................... - - - - (40,458) - (40,458)
--------- ------- ----------- --------- ------------ -------------- -----------
Balance at March 31, 1997........ 7,216,177 $72,162 $38,081,259 $(853,978) $( 8,831,906) $ - $28,467,537
========= ======= =========== ========= ============ ============== ===========
The accompanying notes are an integral part of these financial statements.
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3DX TECHNOLOGIES INC.
STATEMENTS OF CASH FLOWS
(Unaudited)
THREE MONTHS ENDED MARCH 31,
-----------------------------
1996 1997
--------------- ------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss................................................................................... $( 453,139) $ (40,458 )
Adjustments to reconcile net loss to net cash provided by (used in) operating
activities:............................................................................... 138,481 425,699
Depletion, depreciation and amortization.................................................. 160,207 135,170
Compensation expense related to certain stock options..................................... 203,918 -
Impairment of oil and gas properties...................................................... 8,086 38,383
(Increase) decrease in accounts receivable................................................ 21,151 12,660
(Increase) decrease in prepaid expenses................................................... 295,943 ( 211,883)
Increase (decrease) in accounts payable................................................... 3,382 ( 149,183)
Increase (decrease) in accrued liabilities................................................ ---------- ------------
Net cash provided by operating activities.................................................. 378,029 210,388
---------- ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition, exploration and development of oil and gas properties......................... (580,926) (4,761,835)
Purchase of technical and office equipment and leasehold improvements...................... ( 13,453) ( 173,341)
Purchase of technical equipment from Landmark Graphics Corporation......................... (219,461) ( 338,272)
Proceeds from securities held to maturity.................................................. 1,595,167 -
Other...................................................................................... 5,000 -
---------- ------------
Net cash provided by (used in) investing activities........................................ 786,327 ( 5,273,448)
---------- ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Common stock proceeds, net of issuance costs............................................... - 3,799,201
---------- ------------
Net cash provided by financing activities................................................... - 3,799,201
---------- ------------
Net change in cash and cash equivalents..................................................... 1,164,356 ( 1,263,859)
Cash and cash equivalents at beginning of the period........................................ 5,704,014 17,521,745
---------- ------------
Cash and cash equivalents at end of the period.............................................. $6,868,370 $ 16,257,886
========== ============
The accompanying notes are an integral part of these financial statements.
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3DX TECHNOLOGIES INC.
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
1. BASIS OF PRESENTATION
The interim financial statements included herein have been prepared by the
Company in accordance with generally accepted accounting principles, and are
unaudited. In the opinion of management, all necessary adjustments have been
made for a fair presentation of the financial position of 3DX Technologies Inc.
(the "Company") at March 31,1997 and the results of operations for the interim
periods presented. All such adjustments made have been of a normal and recurring
nature. Because of various factors, results of operations for this period are
not necessarily indicative of results to be expected for the year ending
December 31, 1997. Reference is made to the Company's December 31, 1996 audited
financial statements, including the notes thereto.
2. RECENT EVENTS
On December 26, 1996, the Company completed an initial public offering (the
"Offering") of 2,400,000 shares of Common Stock. In January 1997, the Company
issued and sold 375,000 additional shares of Common Stock in connection with an
option granted to the underwriters of the Offering to purchase additional shares
of Common Stock to cover over allotments. The Company received additional net
proceeds of approximately $3.8 million upon issuance of these shares. From the
date of the Offering through March 31, 1997, the aggregate net proceeds of the
Offering, which approximated $27.4 million, have been used (1) to redeem all the
issued and outstanding shares of the Company's Redeemable Preferred Stock,
Series B, par value $.01 per share, (2) for capital and exploration
expenditures, (3) to pay dividends accrued prior to conversion to Common Stock
on the Company's Senior Redeemable Convertible Preferred Stock, Series C, par
value $.01 per share and (4) for general corporate purposes, including expenses
associated with hiring additional personnel. The Company plans to use the
remaining proceeds to fund future capital and exploration programs and for
general corporate purposes.
On January 21, 1997, the Company entered into an agreement with Esenjay
Petroleum Corp., one of the Company's active partners, to increase the Company's
working interest in three projects in the Texas Gulf Coast trend and one project
in the Mississippi/Alabama trend in exchange for consideration in the amount of
$1,337,500.
On March 5,1997, the Company, together with Santa Fe Energy Resources,
Inc., one of the Company's active partners, was the high bidder on four offshore
blocks offered in the Federal Lease Sale No. 166, Central Gulf of Mexico. One of
these high bids has been awarded to the Company, while the remaining three high
bids are subject to review and approval by the U.S. Minerals Management Service,
and are not final until approval is obtained. The Company has incurred pre-lease
costs of $260,000 and has committed an additional $839,765 for this acreage.
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
OVERVIEW
The Company is a knowledge-based oil and gas exploration company whose core
competence and strategic focus is the utilization of 3-D imaging and other
advanced technologies in the search for commercial quantities of hydrocarbons.
The Company enters into arrangements that enable it to combine its expertise and
exploration capabilities with the operating skills of other oil and gas
companies. The Company participates in carefully selected exploration projects
as a non-operating working interest owner, sharing both risks and rewards with
its partners. The Company commenced operations in January 1993 to take
advantage of perceived opportunities emerging from changes in the domestic oil
and gas industry, including the divestiture of domestic oil and gas properties,
advances in technology and the outsourcing of specialized technical
capabilities. By reducing drilling risk through 3-D imaging and analysis, the
Company seeks to improve the expected return on investment in its oil and gas
projects. As a result of the development of the Company's business and the
utilization of a portion of the net proceeds of the Offering during the three
months ended March 31, 1997, the period to period comparisons of the Company's
results of operations are not necessarily meaningful and should not be relied
upon as an indication of future performance.
RESULTS OF OPERATIONS
The following table sets forth certain operating information of the Company
during the periods indicated:
THREE MONTHS ENDED MARCH 31,
------------------------------
1996 1997
--------------- -------------
PRODUCTION:
Gas (MMcf)....................................... 26.7 225.4
Oil and condensate (MBbls)....................... 2.3 2.0
Total equivalent (MMcfe)......................... 40.5 237.4
AVERAGE SALES PRICE:
Gas (per Mcf)....................................$ 1.95 $ 2.77
Oil and condensate (per Bbl).....................$18.88 $24.05
AVERAGE EXPENSES (PER MCFE):
Lease operating (1)..............................$ 0.37 $ 0.38
Depletion of oil and gas properties (2)..........$ 1.12 $ 1.16
(1) Includes all direct expenses of operating the Company's properties, as well
as severance and ad valorem taxes.
(2) Excludes depreciation and amortization of technical interpretation
equipment, office furniture and equipment and office leasehold
improvements, impairments of oil and gas properties and amortization of
organization costs.
-8-
THREE MONTHS ENDED MARCH 31, 1996 COMPARED TO THREE MONTHS ENDED MARCH 31, 1997
Oil and Gas Revenues. Oil and gas revenues increased to $672,270 for the three
months ended March 31, 1997 (the "1997 period") from $94,563 for the three
months ended March 31,1996 (the "1996 period"). Of this increase, approximately
$463,000, or 80%, was attributable to an increase in production and $114,000, or
20%, was attributable to an increase in the average sales price for natural gas
and oil. Production increased by 490% to approximately 237.4 MMcfe for the
1997 period, from 40.5 MMcfe for the 1996 period. The increased production
resulted from successful wells drilled during the last nine months of 1996 and
the 1997 period. The average sales prices for oil increased 27% to $24.05 during
the 1997 period from $18.88 for the 1996 period. The average sales price for
natural gas increased by 42% to $2.77 per Mcf for the 1997 period from $1.95 per
Mcf for the 1996 period.
Lease Operating Expense. Lease operating expense (including production and ad
valorem taxes) increased to $91,084 for the 1997 period from $14,710 for the
1996 period. This increase was primarily attributable to the increase in
production during the 1997 period. Lease operating expense per Mcfe increased by
5% to $0.38 per Mcfe for the 1997 period from $0.37 per Mcfe for the 1996
period. Although the Company is unable to predict with certainty the lease
operating expense per Mcfe that may be incurred in the future, the Company does
not anticipate that such expenses on a per Mcfe basis will be in amounts less
than those which were incurred during the 1997 period.
Depletion, Depreciation and Amortization Expense. The major components of
depletion, depreciation and amortization are depletion of oil and gas properties
and depreciation and amortization of technical and office equipment.
Depletion of oil and gas properties for the 1997 period increased to $276,106
from $45,000 for the 1996 period. The increase in depletion of oil and gas
properties resulted from the increase in oil and gas production during the 1997
period. Depletion of oil and gas properties per Mcfe for the 1997 period
increased 4% to $1.16 from $1.12 due to reserve increases occurring at a slower
rate than the increase in the Company's evaluated property full cost pool of
capitalized costs during the 1997 period.
Depreciation and amortization of technical interpretation equipment, office
furniture and equipment and office leasehold improvements increased to $149,593
for the 1997 period from $93,481 for the 1996 period. This increase was
primarily attributable to the acquisition of additional technical interpretation
equipment and software with an approximate cost of $512,000 during 1997.
Impairment of Oil and Gas Properties. No oil and gas impairment charges were
recorded as of March 31, 1997. Oil and gas impairment charges recorded during
the 1996 period totaled $203,918, primarily as a result of completion of the
evaluation of a prospect which had poor drilling results during the period. The
addition of the total investment in this prospect to evaluated costs resulted in
impairment charges under the Company's full cost accounting policy for oil and
gas operations.
General and Administrative Expense. General and administrative expense, net of
costs capitalized to exploration and development projects, increased to $447,451
for the 1997 period from $292,050 for the 1996 period. This increase was
attributable to (1) expenses associated with hiring additional personnel as
part of the planned increase in the Company's activities, and (2) compensation
expense recognized in connection with stock options granted during the twelve
months prior to the initial filing with the Securities and Exchange Commission
of a registration statement relating to the Offering, which expense is based on
the difference between the exercise price of such options and the initial $11.00
per share Offering price of the Common Stock.
Rental Income. Rental income increased to $84,503 for the 1997 period from
$12,710 for the 1996 period. The Company derives rental income pursuant to an
agreement to exchange use of certain of the Company's technical and office
equipment by an independent seismic processing company for a percentage of the
gross fee billings of such seismic processing company. As a result, the rental
income recognized by the Company varies significantly from period to period.
-9-
Interest and Other Income. Interest and other income increased to $167,003 for
the 1997 period from $88,747 for the 1996 period, primarily as a result of an
increase in short-term investments made with the proceeds of the Offering.
Net Loss. The Company's net loss decreased to $40,458 for the 1997 period from
$453,139 for the 1996 period, primarily as a result of the substantial increase
in revenues, offset by a 49% increase in total costs and expenses, as detailed
above,
LIQUIDITY AND CAPITAL RESOURCES
At March 31, 1997, the Company had working capital in the amount of $15.6
million. To date, the Company has funded its oil and gas exploration activities
principally through cash provided by the sale of equity securities.
On December 26, 1996, the Company completed an Initial Public Offering for the
sale of 2,400,000 shares of Common Stock. From the date of the Initial Public
Offering through March 31, 1997, the net proceeds of the Offering, approximated
$27.4 million, including over-allotment. Of such proceeds, approximately $9.0
million has been paid through March 31, 1997 (1) to redeem all the issued and
outstanding shares of the Series B Preferred Stock, (2) for capital and
exploration expenditures, (3) to pay dividends accrued on the issued and
outstanding Series C Preferred Stock and (4) for general corporate purposes,
including expenses associated with hiring additional personnel. The Company
plans to use the remaining proceeds to fund future capital and exploration
programs and general corporate purposes.
Net cash used in investing activities for the 1997 period was $5.3 million. The
acquisition, exploration and development of oil and gas properties in the amount
of $4.8 million was the principal use of cash in the Company's investing
activities during the 1997 period. During the 1996 period, the Company had a
net source of cash from investing activities in the amount of $786,327,
primarily as a result of the maturity of investment securities held to maturity
totaling $1.6 million, offset by the acquisition, exploration and development of
oil and gas properties in the amount of $580,926.
The Company has no outstanding long-term debt and is not a party to any debt or
collateral-based lending arrangements. The Company has never utilized commodity
swaps for its oil and gas production and it does not anticipate doing so in the
foreseeable future. In addition, the Company has not entered into any hedging
transactions and has no current intention to do so in the future.
The development of the Company's business has in the past required substantial
oil and gas capital expenditures. To meet its goal, the Company in the future
will be required to make oil and gas capital expenditures substantially in
excess of historical levels to acquire, explore and develop oil and gas
properties. Capital expenditures for oil and gas exploration and production
activities during the 1996 and 1997 periods, were $580,926 and $4.8 million,
respectively. Capital expenditures for the Company's oil and gas exploration and
production activities during the year ended December 31, 1997 were originally
budgeted at $14.9 million. However, the Company continues to identify new
opportunities for capital investment and total spending for 1997 could exceed
this amount. The timing and amount of the Company's capital spending is also
dependent on the outcome of exploratory drilling activities.
Although the Company presently has no current commitment or intention to sell
all or any portion of its working interests, the sales could be used as a source
of liquidity by the Company in the future.
The Company expects that its available cash and expected cash flows from
operating activities will be sufficient to meet its financial obligations and
fund its planned exploration and drilling activities for the short term (through
March 31, 1998), provided, that (i) there are no significant declines in oil and
gas prices below current levels or anticipated seasonal lows, (ii) there are no
significant declines in oil and gas production from existing properties other
than declines in production currently anticipated based on engineering estimates
of the decline curves associated with such properties and (iii) the Company is
able to discover and produce commercial quantities of oil and gas and within the
time frame the Company has predicted. The Company intends to satisfy its long-
term liquidity requirements from a combination of expected cash flow generated
from
-10-
operations, borrowings from financial institutions (which may be secured by the
Company's oil and gas reserves) and from future public or private offerings of
equity and/or debt securities. For liquidity purposes, the Company considers
"long-term" to be the second, third and fourth twelve-month periods following
March 31, 1997.
In the event the cash flows from the Company's operating activities and the
current working capital surplus are not sufficient to fund development and
exploration expenditures, or results from developmental drilling are not as
successful as anticipated, the Company will be required to modify the
implementation of its operating strategy unless additional financing is
available. There can be no assurance such financing would be available on terms
which would be acceptable to the Company.
EFFECTS OF INFLATION AND CHANGES IN PRICE
The Company's results of operations and cash flows are affected by changing oil
and gas prices. If the price of oil and gas increases (decreases), there could
be a corresponding increase (decrease) in the operating cost that the Company is
required to bear for operations, as well as an increase (decrease) in revenues.
Historically, inflation has had a minimal effect on the Company.
OTHER
In connection with stock options granted within one year prior to the initial
filing of the registration statement relating to the Initial Public Offering,
the Company recorded deferred compensation expense based on the difference
between the option exercise price and the fair value of the common stock at the
date of grant (using the $11.00 per share Offering price as an estimate of the
fair value). As of March 31, 1997, the Company had unamortized deferred
compensation of $853,978 which will be charged to expense during the next four
years.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as amended (the
"Securities Act"), and section 21E of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"). Actual results, events and circumstances could
differ materially from those set forth in such statements due to various
factors. Such factors include the possibility that the drilling of wells in
projects in which the Company has a working interest may be delayed or
abandoned, actual rates of production may not reach anticipated levels and
opportunities for the Company to acquire future working interests in additional
projects on terms considered reasonable to the Company may be limited or
unavailable, changing economic, regulatory and competitive conditions, other
technological developments and other risks and uncertainties, including those
set forth herein. The Company's future financial results will depend primarily
on: (i) the Company's ability to continue to source and screen potential
projects; (ii) the Company's ability to discover commercial quantities of
hydrocarbons; (iii) the market price for oil and gas; and (iv) the Company's
ability to fully implement its exploration and development program. There can
be no assurance that the Company will be successful in any of these respects or
that the prices of oil and gas prevailing at the time of production will be at a
level allowing for profitable production. The Company expects that its available
cash and expected cash flows from operating activities will be sufficient to
meet its financial obligations and fund its planned exploration and drilling
activities for the short term (twelve months from March 31, 1997), provided,
that (i) there are no significant declines in oil and gas prices below current
levels or anticipated seasonal lows, (ii) there are no significant declines in
oil and gas production from existing properties other than declines in
production currently anticipated based on engineering estimates of the decline
curves associated with such properties and (iii) the Company is able to discover
and produce commercial quantities of oil and gas within the time frame, at rates
of production the Company has predicted. The Company intends to satisfy its
long-term liquidity requirements from a combination of expected cash flow
generated from operations, borrowings from financial institutions (which may be
secured by the Company's oil and gas reserves) and from future public or private
offerings of equity and/or debt securities. For liquidity purposes, the Company
considers "long-term" to be the second, third and fourth twelve month periods
following March 31, 1997.
-11-
PART II. OTHER INFORMATION
ITEM 1 Legal Proceedings
None
ITEM 2 Changes in Securities
None
ITEM 3 Defaults Upon Senior Securities
None
ITEM 4 Submission of Matters to a Vote of Security Holders
None
ITEM 5 Other Information
None
ITEM 6 Exhibits and Reports on Form 8-K
(a) Exhibits
11.1 Computation of Earnings per Share
27. Financial Data Schedule
(b) Reports on Form 8-K
No reports on Form 8-K were filed by the Company during the quarter
ended March 31, 1997.
-12-
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this Report to be signed on
its behalf by the undersigned, thereunto duly authorized.
3DX TECHNOLOGIES INC.
(Registrant)
Date: May 14, 1997 By: /s/ C. Eugene Ennis
---------------------------------------
President and Chief Executive Officer
(Principal Executive Officer)
Date: May 14, 1997 By: /s/ Randall D. Keys
---------------------------------------
Vice President - Finance
and Chief Financial Officer
(Principal Financial and Accounting Officer)
-13-
INDEX TO EXHIBITS
EXHIBIT
NUMBER DESCRIPTION OF EXHIBIT
11.1 Computation of Earnings per Share.
27. Financial Data Schedule (for SEC use only)
-14-