1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K/A
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) August 15, 1995
------------------------------
GOODRICH PETROLEUM CORPORATION
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
DELAWARE 33-58831 76-0466913
- --------------------------------------------------------------------------------
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
5847 SAN FELIPE, SUITE 700, HOUSTON, TEXAS 77057
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 713-780-9494
-----------------------------
2
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS Page No.
--------
(A) FINANCIAL STATEMENTS OF BUSINESSES ACQUIRED
1) La/Cal Energy Partners
----------------------
Independent Auditors' Report **
Balance Sheet -- December 31, 1994 **
Statements of Operations -- Year ended December 31, 1994 and **
period from July 15, 1993 through December 31, 1993
Statements of Partners' Capital (Deficit) -- Year ended December **
31, 1994 and period from July 15, 1993 through December 31, 1993
Statements of Cash Flow -- Year ended December 31, 1994 and **
period from July 15, 1993 through December 31, 1993
Notes to Financial Statements -- December 31, 1994 and 1993 **
Properties Contributed to La/Cal Energy Partners -- Independent **
Auditors' Report
Properties Contributed to La/Cal Energy Partners -- Statement of **
Revenues and Direct Operating Expenses -- Period from January
1, 1993 through July 14, 1993
Supplementary Oil and Gas Reserve Information -- Years ended **
December 31, 1994 and 1993 (unaudited)
Properties Acquired from Mobil Corporation -- Statements of **
Revenues -- Year ended December 31, 1993 (unaudited)
Properties Acquired from Foster Brown Company -- Statement **
of Revenues and Direct Operating Expenses -- Period from
January 1, 1993 through November 30, 1993 (unaudited)
Balance Sheets (unaudited) as of June 30, 1995 and December 31, F - 1
1994
Statements of Operations (unaudited) for the six months ended F - 2
June 30, 1995 and 1994
3
Statements of Partners' Capital (Deficit) (unaudited) for the six F - 3
months ended June 30, 1995 and 1994
Statements of Cash Flows (unaudited) for the six months ended F - 4
June 30, 1995 and 1994
Notes to Financial Statements - June 30, 1995 and 1994 F - 5
2) Patrick Petroleum Company
-------------------------
Independent Auditors' Report **
Consolidated Balance Sheets at December 31, 1994 and 1993 **
Consolidated Statements of Operations for the three years **
ending December 31, 1994, 1993 and 1992
Consolidated Statements of Stockholders' Equity for the three **
years ending December 31, 1994, 1993 and 1992
Consolidated Statements of Cash Flows for the three years **
ending December 31, 1994, 1993 and 1992
Notes to Consolidated Financial Statements -- December 31, **
1994 and 1993
Consolidated Balance Sheets as of June 30, 1995 (unaudited) and *
December 31, 1994
Consolidated Statements of Operations (unaudited) for the six months *
ended June 30, 1995 and 1994
Consolidated Statements of Stockholders' Equity (unaudited) for the *
six months ended June 30, 1995 and 1994
Consolidated Statements of Cash Flows (unaudited)for the six months *
ended June 30, 1995 and 1994
Notes to Consolidated Financial Statements - June 30, 1995 *
and 1994
4
* These financial statements are not included herein because such financial
statements were included in Patrick Petroleum Company's quarterly report
on Form 10-Q as of June 30, 1995. Such financial statements and the notes
related thereto are hereby incorporated by reference.
** These financial statements are not presented here since they have been
previously reported by the registrant in its Form S-4 registration
statement (No. 33-58631)
(B) PRO FORMA FINANCIAL INFORMATION
Introduction to Unaudited Pro Forma Condensed Financial F - 6
Information
Unaudited Pro Forma Condensed Balance Sheet as of June F - 7
30, 1995
Unaudited Pro Forma Condensed Statement of Operations F - 9
for the year ended December 31, 1994
Unaudited Pro Forma Condensed Statement of Operations F - 10
for the six months ended June 30, 1995
Notes to Unaudited Pro Forma Condensed Financial Infor- F - 11
mation - As of and for the six months ended June 30, 1995
5
LA/CAL ENERGY PARTNERS
BALANCE SHEETS
June 30, December 31,
1995 1994
------------ ------------
(unaudited)
ASSETS
CURRENT ASSETS:
Cash.......................................................... $ 715,052 $ 710,762
Accrued oil and gas revenues receivable....................... 701,183 934,910
------------ ------------
TOTAL CURRENT ASSETS............................... 1,416,235 1,645,672
PROPERTY AND EQUIPMENT:
Producing leasehold costs...................................... 6,262,476 6,262,476
Lease and well equipment....................................... 1,007,769 1,009,073
------------ ------------
7,270,245 7,271,549
Less accumulated depreciation and depletion.................... 1,708,112 1,309,866
------------ ------------
Net property and equipment......................... 5,562,133 5,961,683
Organizational cost, at amortized cost.............................. 54,715 63,709
Deferred financing cost, at amortized cost.......................... 502,037 559,432
Other deferred charges.............................................. 346,331 ---
------------ ------------
$ 7,881,451 $ 8,230,496
============ ============
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
CURRENT LIABILITIES:
Current portion of long-term debt.............................. $ 2,885,862 $ 1,816,723
Accounts payable............................................... 122,449 135,916
Accrued expenses and other current liabilities................. 47,723 109,074
------------ ------------
TOTAL CURRENT LIABILITIES......................... 3,056,034 2,061,713
Long-term debt, excluding current portion.............................. 6,383,699 8,250,000
------------ ------------
TOTAL LIABILITIES................................ 9,439,733 10,311,713
Partners' capital (deficit)............................................ (1,558,282) (2,081,217)
------------ ------------
$ 7,881,451 $ 8,230,496
============ ============
See accompanying notes to financial statements.
F - 1
6
LA/CAL ENERGY
STATEMENTS OF OPERATIONS
SIX MONTHS ENDED JUNE 30, 1995 AND 1994
(UNAUDITED)
1995 1994
------------ ------------
REVENUES:
Oil and gas sales........................................... $ 2,168,138 $ 1,990,767
Interest.................................................... 12,902 6,968
------------ ------------
Total revenues.................................. 2,181,040 1,997,735
------------ ------------
EXPENSES:
Lease operating expense and production taxes................ 296,433 242,163
Exploration expenses........................................ --- 4,859
Depreciation, depletion and amortization.................... 407,240 421,643
General and administrative.................................. 3,307 44,516
Interest.................................................... 537,225 483,978
------------ ------------
Total expenses.................................. 1,244,205 1,197,159
------------ ------------
Net income...................................... $ 936,835 $ 800,576
============ ============
NET INCOME AS ADJUSTED FOR INCOME TAXES:
Income before income taxes as above.......................... $ 936,835 $ 800,576
Proforma income tax expense*................................. 365,366 312,225
------------ ------------
Net income as adjusted for income taxes...................... $ 571,469 $ 488,351
============ ============
* No provision for income taxes is included in the statements of operations
since such taxes are the responsibility of the individual partners.
Certain unaudited pro forma information relating to the Partnership's
results of operations for the aforementioned periods had the Partnership
been treated as a corporation is shown above.
See accompanying notes to financial statements.
F - 2
7
LA/CAL ENERGY PARTNERS
STATEMENTS OF PARTNERS' CAPITAL (DEFICIT)
SIX MONTHS ENDED JUNE 30, 1995 AND 1994
(UNAUDITED)
1995 1994
------------ ------------
BALANCE AT BEGINNING OF PERIOD............ $ (2,081,217) $ (988,777)
Capital contributions............. --- ---
Capital distributions............. (413,900) (2,324,134)
Net income........................ 936,835 800,576
------------ ------------
BALANCE AT END OF PERIOD.................. $ (1,558,282) $ (2,512,335)
============ ============
See accompanying notes to financial statements.
F - 3
8
LA/CAL ENERGY PARTNERS
STATEMENTS OF CASH FLOWS
SIX MONTHS ENDED JUNE 30, 1995 AND 1994
(UNAUDITED)
1995 1994
------------ ------------
Cash flows from operating activities:
Net income............................................................... $ 936,835 $ 800,576
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation, delpetion, and amortization............................ 407,240 421,643
Amortization of deferred financing costs............................. 57,395 55,137
(Increase) decrease in accrued oil and gas receivable................ 233,727 (380,386)
Increase (decrease) in accounts payable.............................. (13,467) 162,442
Increase (decrease) in accrued expenses and other
current liabilities............................................. (61,351) 1,462
------------ ------------
Net cash provided by operating activities........................ 1,560,379 1,060,874
------------ ------------
Cash flows from investing activities:
Capital expenditures................................................. --- (3,144,500)
Other................................................................ 1,304 ---
------------ ------------
Net cash provided (used) by investing activities................. 1,304 (3,144,500)
------------ ------------
Cash flows from financing activities:
Proceeds from long-term debt............................................ --- 4,843,449
Payments on long-term debt.............................................. (797,162) (580,308)
Deferred costs.......................................................... (346,331) ---
Capital distributions................................................... (413,900) (2,324,134)
------------ ------------
Net cash provided (used) by financing activities................. (1,557,393) 1,939,007
------------ ------------
Net (decrease) increase in cash.............................................. 4,290 (144,619)
Cash at beginning of period.................................................. 710,762 752,138
------------ ------------
Cash at end of period........................................................ $ 715,052 $ 607,519
------------ ------------
Supplemental cash flow information:
Interest paid during period............................................. $ 514,236 $ 426,783
Noncash investing and financing activities --
Deferred financing cost............................................ $ --- $ 292,560
See accompanying notes to financial statements.
F - 4
9
LA/CAL ENERGY PARTNERS
NOTE TO FINANCIAL STATEMENTS
(UNAUDITED)
JUNE 30, 1995 AND 1994
1) BASIS OF PRESENTATION
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to rules and regulations of
the Securities and Exchange Commission; however, La/Cal believes the
disclosures which are made are adequate to make the information presented not
misleading. These financial statements and footnote should be read in
conjunction with the financial statements and notes thereto included in
La/Cal's historical financial statements for the year ended December 31, 1994
and for the period from July 15, 1993 through December 31, 1993 incorporated by
reference herein.
The unaudited financial information for the six months ended June 30,
1995 and 1994 has not been audited by independent public accountants; however,
in the opinion of the management, all adjustments (which include only normal
recurring adjustments) necessary to present fairly the results of operations
for the periods presented have been included therein. The results of
operations for the first six months of the year are not necessarily indicative
of the results of operations which might be expected for the entire year.
2) PENDING MERGER
On March 10, 1995, La/Cal entered into an Agreement and Plan of Merger
with Patrick Petroleum Company (PPC). Under the terms of the Merger Agreement,
La/Cal would contribute its oil and gas assets and its liabilities to a holding
company, Goodrich Petroleum Corporation (GPC), in exchange for approximately
fifty percent of the common stock of GPC, and PPC would become a subsidiary of
GPC and the common shareholders of PPC would receive approximately fifty
percent of the common stock of GPC.
On August 15, 1995, the Merger was declared effective.
F - 5
10
GOODRICH PETROLEUM CORPORATION
UNAUDITED PRO FORMA CONDENSED FINANCIAL INFORMATION
The following unaudited pro forma condensed financial information of
Goodrich Petroleum Corporation (the "Company") (the "pro forma information")
separately reflects the effects under the purchase method of accounting of 1)
the combination of La/Cal Energy Partners ("La/Cal") and Patrick Petroleum
Company ("Patrick") through two concurrent transactions (the "Transactions"):
(i) the contribution by La/Cal (the "Asset Transfer") of all of its assets and
liabilities (excluding cash and accounts receivable accrued prior to March 1,
1995, and interest thereon) (the "La/Cal Interests") to the Company in exchange
for 19,765,226 shares of the Company's common stock, and (ii) the merger of a
subsidiary of the Company with Patrick whereby the shares of Patrick common
stock and Patrick preferred stock were converted into shares of Goodrich common
stock and Goodrich preferred stock, respectively, on a one-for-one basis and
Patrick became a wholly-owned subsidiary of the Company and 2) Patrick's
disposition of its interests in certain oil and gas wells and related acreage,
personal property and contract rights on December 15 and 16, 1994 to Unit
Petroleum and LLOG Exploration. Pro forma adjustments applicable to the
Transactions and the Patrick oil and gas properties' disposition and the
assumptions on which they are based are described under " --Notes to Unaudited
Pro Forma Condensed Financial Information."
The pro forma information is presented for illustration purposes only
and is not necessarily indicative of the financial position or operating
results that would have occurred if the Transactions and the Unit Petroleum
Sale and the LLOG Exploration Sale had been consummated in accordance with the
assumptions set forth below, nor is it necessarily indicative of future
financial position or operating results. The pro forma information is prepared
on the assumptions that the Transactions and the Patrick oil and gas
properties' disposition took place as of the dates indicated below; however,
the Company's and Patrick's actual financial statements reflect or will
ultimately reflect the Unit Petroleum Sale and the LLOG Exploration Sale, and
the Transactions from and after the respective closing dates of such
transaction.
The pro forma information should be read in conjunction with the
financial statements and notes thereto of La/Cal and Patrick which are included
elsewhere or incorporated by reference elsewhere herein.
F - 6
11
GOODRICH PETROLEUM CORPORATION
UNAUDITED PRO FORMA CONDENSED BALANCE SHEET
JUNE 30, 1995
(Note B)
------------
Historical Historical Pro Forma Combined
Patrick La/Cal Adjustments Pro Forma
------------ ------------ ------------ ------------
ASSETS
Current assets:
Cash and cash equivalents................................ $ 487,624 $ 715,052 $ (1,037,983) (1) $ 1,100,000
1,526,976 (3)
(691,669) (5)
9,600,000 (7)
(9,500,000) (7)
Marketable securities..................................... 928,400 --- 928,400
Accounts receivable:
Trade and other....................................... 179,760 --- 179,760
Accrued oil and gas revenue.......................... 636,524 701,183 1,337,707
Prepaid expenses.......................................... 100,209 --- 100,209
Assets held for sale...................................... 836,238 --- 1,563,762 (4) ---
(2,400,000) (7)
------------ ------------ ------------
Total current assets.......................... 3,168,755 1,416,235 3,646,076
Other assets:
Investments in Penske entities............................ 2,508,716 --- 4,691,284 (4) ---
(7,200,000) (7)
Investment in Pecos pipeline.............................. 1,957,144 --- 3,310,778 (4) 5,267,922
Other investments and deferred charges.................... 140,862 903,083 (502,037) (3) 195,577
(346,331) (5)
Net property and equipment........................................ 19,921,720 5,562,133 (7,511,093) (4) 17,972,760
------------ ------------ ------------ ------------
Total assets.................................. $ 27,697,197 $ 7,881,451 $ (8,496,313) $ 27,082,335
============ ============ ============ ============
F - 7
12
GOODRICH PETROLEUM CORPORATION
UNAUDITED PRO FORMA CONDENSED BALANCE SHEET (CONTINUED)
JUNE 30, 1995
(Note B)
------------
Historical Historical Pro Forma Combined
Patrick La/Cal Adjustments Pro Forma
------------ ------------ ------------ ------------
LIABILITIES AND
STOCKHOLDERS' EQUITY
Current liabiltities:
Current portion of long-term debt........................ $ 1,000,000 2,885,862 $ (2,885,862) (3) ---
(1,000,000) (7)
Accounts payable.......................................... 1,544,487 122,449 1,666,936
Accrued liabilities....................................... 395,542 47,723 382,000 (6) 825,265
Reserve for contingent liabilities........................ 1,018,244 --- 1,018,244
------------ ------------ ------------
Total current liabilities..................... 3,958,273 3,056,034 3,510,445
Long-term debt.................................................... 8,173,861 6,383,699 4,412,838 (3) 10,470,398
(8,500,000) (7)
Other noncurrent liabilities...................................... 698,000 (6) 698,000
Stockholders' equity:
Partner's capital (deficit)............................... (1,558,282) (1,037,983) (1) ---
2,596,265 (2)
Preferred stock........................................... 1,175,000 1,175,000
Common stock.............................................. 3,996,215 3,953,045 (2) 7,906,090
(3,996,215) (4)
3,953,045 (4)
Additional paid-in capital................................ 82,088,679 (6,549,310) (2) 3,824,439
(82,088,679) (4)
12,491,749 (4)
(1,038,000) (5)
(1,080,000) (6)
Retained earnings (deficit)............................... (71,335,041) (502,037) (3) (502,037)
71,335,041 (4)
Unrealized gain on marketable securities................. 347,350 (347,350) (4) 0
Less treasury stock...................................... (707,140) 707,140 (4) 0
------------ ------------ ------------
Total stockholders' equity.................... 15,565,063 (1,558,282) 12,403,492
------------ ------------ ------------ ------------
Total liabilites and stockholders' equity..... $ 27,697,197 $ 7,881,451 $ (8,496,313) $ 27,082,335
============ ============ ============ ============
Book value applicable to common stock or partners' deficit........ $ 3,815,063 $ (1,558,282) $ 653,492
============ ============ ============
Book value per share or unit...................................... $ 0.17 $ (0.08) $ 0.02
============ ============ ============
Common shares or units outstanding................................ $ 19,765,226 $ 19,765,226 $ 39,530,452
============ ============ ============
F - 8
13
GOODRICH PETROLEUM CORPORATION
UNAUDITED PRO FORMA CONDENSED STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1994
(NOTE C)
-------------
HISTORICAL PRO FORMA PRO FORMA HISTORICAL
PATRICK ADJUSTMENTS PATRICK LA/CAL
-------------- ------------- ----------- -----------
Revenues:
Oil and gas sales............................... $ 11,071,486 $ (7,864,155) $ 3,207,331 $ 4,995,663
Interest and dividend income................... 147,210 147,210 17,783
Net gain on sale of investments................. 6,447,102 6,447,102 --
Revenue from pipeline system.................... 1,111,525 1,111,525 --
Other income.................................... 212,084 (162,710) 49,374 --
-------------- -------------- -----------
18,989,407 10,962,542 5,013,446
Expenses:
Lease operating costs and production taxes...... 4,921,345 (3,148,671) 1,772,674 684,131
Depletion, depreciation, and amortization....... 6,491,645 (4,089,360) 2,402,285 1,156,624
Exploration expenses............................ -- -- 4,240
General and administrative...................... 3,311,240 (1,242,000) 2,069,240 81,535
Interest........................................ 2,170,478 (771,728) 1,398,750 1,072,098
Impairment of oil and gas properties and
other assets.................................. 12,557,652 12,557,652 --
Income (loss) on sale of oil and
gas properties................................ 2,786,841 (2,786,841) -- --
-------------- -------------- -----------
32,239,201 20,200,601 2,998,628
-------------- -------------- -----------
Income (loss) before income tax expense........... (13,249,794) (9,238,059) 2,014,818
Pro forma income tax expense...................... -- -- 785,779
-------------- -------------- -----------
Income (loss) before extraordinary item........... (13,249,794) (9,238,059) 1,229,039
Preferred stock dividend requirement.............. (940,000) (940,000) --
-------------- ------------ -------------- ----------
Income (loss) before extraordinary item applicable
to common stock............................ $ (14,189,794) $ 4,011,735 $ (10,178,059) $ 1,229,039
============== ============ ============== ===========
Income (loss) before extraordinary item per
common share or unit....................... $ (0.72) $ (0.51) $ 0.06
============== ============== ===========
Weighted average common share or units
outstanding................................ 19,765,226 19,765,226 19,765,226
============== ============== ===========
(NOTE D)
--------------
PRO FORMA COMBINED
ADJUSTMENTS PRO FORMA
-------------- --------------
Revenues:
Oil and gas sales................................ $ $ 8,202,994
Interest and dividend income.................... (139,000) (3) 25,993
Net gain on sale of investments.................. 6,447,102
Revenue from pipeline system..................... 1,111,525
Other income..................................... 49,374
------------
15,836,988
Expenses:
Lease operating costs and production taxes....... 2,456,805
Depletion, depreciation, and amortization........ (118,285) (1) 3,440,624
Exploration expenses............................. 1,133,000 (1) 2,837,240
1,700,000 (4)
General and administrative....................... 203,000 (4) 2,353,775
Interest......................................... (1,075,000) (2) 1,395,848
Impairment of oil and gas properties and
other assets................................... (12,301,000) (1) 256,652
Income (loss) on sale of oil and
gas properties................................. --
------------
12,740,944
------------
Income (loss) before income tax expense............ 3,096,044
Pro forma income tax expense....................... (785,779) (5) --
------------
Income (loss) before extraordinary item............ 3,096,044
Preferred stock dividend requirement............... (940,000)
Income (loss) before extraordinary item applicable
------------ ------------
to common stock............................. $ 11,105,064 $ 2,156,044
============ ============
Income (loss) before extraordinary item per
common share or unit....................... $ 0.05
============
Weighted average common share or units outstanding. 39,530,452
============
F - 9
14
GOODRICH PETROLEUM CORPORATION
UNAUDITED PRO FORMA CONDENSED STATEMENT OF OPERATIONS
SIX MONTHS ENDED JUNE 30, 1995
(Note D)
---------------
Historical Historical Pro Forma Combined
Patrick La/Cal Adjustments Pro Forma
------------ ------------ --------------- ------------
REVENUES:
Oil and gas sales...............................$ 1,949,199 $ 2,168,138 $ $ 4,117,337
Interest and dividend income................... 102,273 12,902 (102,273)(3) 12,902
Net gain on sale of investments................. 1,563,762 -- 1,563,762
Revenue from pipeline system.................... 799,838 -- 799,838
Other income.................................... 457,329 -- 457,329
------------ ------------ ------------
4,872,401 2,181,040 6,951,168
EXPENSES:
Lease operating costs and production taxes...... 791,317 296,433 1,087,750
Depletion, depreciation, and amortization....... 1,207,167 407,240 151,020 (1) 1,765,427
Exploration expenses............................ -- -- 180,000 (4) 180,000
General and administrative...................... 1,577,818 3,307 100,736 (4) 1,319,861
(362,000)(7)
Interest........................................ 503,419 537,225 (503,419)(2) 442,225
(95,000)(6)
------------ ------------ ------------
4,079,721 1,244,205 4,795,263
------------ ------------ ------------
Income before income tax expense........................ 792,680 936,835 2,155,905
------------ ------------ ------------
Pro forma income tax expense............................ -- 365,366 (365,366)(5) --
------------ ------------ ------------
Income before extraordinary item........................ 792,680 571,469 2,155,905
Preferred stock dividend requirement.................... (470,000) -- (470,000)
------------ ------------ ------------ ------------
Income before extraordinary item applicable
to common stock..................................$ 322,680 $ 571,469 $ 791,756 $ 1,685,905
============ ============ ============ ============
Income before extraordinary item per
common share or unit............................$ 0.02 $ 0.03 $ 0.04
============ ============ ============
Weighted average common share or units outstanding...... 19,765,226 19,765,226 39,530,452
============ ============ ============
F - 10
15
GOODRICH PETROLEUM CORPORATION
NOTES TO UNAUDITED PRO FORMA CONDENSED FINANCIAL INFORMATION
(A) BASIS OF PRESENTATION. The unaudited pro forma condensed
financial information reflects the contribution by La/Cal of the La/Cal
Interests to the Company and the subsequent acquisition by the Company of
Patrick using the purchase method of accounting. The accounting policies of
the Company will be the same as those of La/Cal and accordingly pro forma
adjustments are also included related to Patrick's pro forma historical
statement of operations to present such operations utilizing the same
accounting policies as La/Cal.
(B) JUNE 30, 1995 BALANCE SHEET PRO FORMA ADJUSTMENTS. The pro forma
adjustments applicable to the June 30, 1995 balance sheet assume the
Transactions took place as of June 30, 1995 and reflect a preliminary purchase
price allocation that will be refined subsequent to the closing of the
Transactions.
(1) This adjustment reflects cash and accounts receivable accrued
prior to March 1, 1995, with interest thereon, which were not transferred to
the Company by La/Cal, and the distribution of such amount to the La/Cal
Partners.
(2) This adjustment reflects the exchange of La/Cal Partners' net
interest in La/Cal for 19,765,226 shares of common stock ($.20 par value).
(3) The Company entered into a new bank credit facility upon the
closing of the Transactions. The facility provides for two interest rate
options with interest payable at least quarterly. The debt matures on June
1, 1997. The amount borrowed was an amount sufficient to pay off La/Cal's
outstanding debt after considering partial paydown from the Penske
transaction (see (B) (7) below) and provide the Company with a cash balance
of approximately $1,000,000. This results in outstanding debt on a pro
forma basis under the credit facility of $10,470,398 as of June 30, 1995.
Deferred financing costs of $502,037 related to the retired debt of La/Cal
will be charged to expense as an extraordinary item, however, it is reflected
as a charge to equity as of June 30, 1995 for pro forma purposes.
(4) In order to determine the purchase price of Patrick, La/Cal
valued all assets and liabilities of Patrick at fair value as follows:
Patrick
Carrying Fair Pro Forma
Value Value Adjustment
--------- --------- ----------
Current assets (excluding assets held for sale),
at carrying value....................... $ 3,168,755 $ 3,168,755 $ -
Assets held for sale, at cash price received..... 836,238 2,400,000 1,563,762
Investment in Penske entities, at cash price
received................................ 2,508,716 7,200,000 4,691,284
Investment in Pecos pipeline, based on
discounted cash flow.................... 1,957,144 5,267,922 3,310,778
Other assets, at carrying value.................. 140,862 140,862 --
Net property and equipment, based on
discounted cash flow analyses
and estimated values.................... 19,921,720 12,410,627 (7,511,093)
All liabilities, at carrying value............... (12,132,134) (12,132,134) --
-----------
$18,456,032
===========
F - 11
16
This adjustment adjusts the assets acquired and liabilities assumed to
equal fair value as indicated above. The determination of the purchase
price was made by reference to an estimate of the fair value of the net
assets of Patrick acquired by La/Cal. The value of the Patrick Preferred
Stock and Patrick Common Stock was not used as such securities have
experienced substantial volatility and accordingly, such indicated value may
not be representative of the fair value of the net assets acquired. This
adjustment also reflects the exchange of 19,765,226 shares of the Company's
common stock ($.20 par value) and 1,175,000 shares of the Company's
preferred stock ($1.00 par value) for an equal number of shares of Patrick
common stock and Patrick's preferred stock and the elimination of Patrick's
stockholders' equity.
(5) To reflect the expenses of the Transactions including Petrie
Parkman fees and expenses of approximately $300,000 and various other
expenses estimated to be approximately $1,100,000. Of the total amount, as
of June 30, 1995, approximately $346,000 had been paid by La/Cal and
recorded as a deferred charge and approximately $362,000 had been paid by
Patrick and recorded as general and administrative expense. For pro forma
purposes these purchase costs are an adjustment to the amount of additional
paid-in capital recorded in pro forma adjustment (B) (4).
(6) To accrue costs related to certain consulting agreements entered
into with former employees of Patrick as costs of the Transactions since
such amounts are payable regardless of whether services are performed. For
pro forma purposes these costs are an adjustment to the amount of additional
paid-in capital recorded in pro forma adjustment (B) (4).
(7) To reflect the call by Penske of Patrick's investment in Penske as
a result of the Transactions as if such call occurred on June 30, 1995. The
Penske investment is valued at $9,600,000, which is equal to the amount
received by the Company on September 18, 1995. For pro forma purposes,
$9,500,000 of the proceeds were used to pay down the Patrick debt and a
portion of the La/Cal debt.
(8) Deferred income tax liabilities have not been reflected for the
difference between the amounts certain assets have been recorded in excess
of their tax basis due to the availability to the Company of Patrick's net
operating loss carryforwards to offset such deferred tax liabilities. It is
expected that such net operating loss carryforwards will be used in the
short term or available tax planning strategies exist such that the
potential taxes will be offset by the net operating loss carryforwards at a
future date and it is anticipated that such strategies will be used if
necessary. To the extent that net operating loss carryforwards and tax
credit carryforwards are realized in the future in excess of amounts
utilized to offset deferred tax liabilities at date of acquisition, such
excess amounts realized will be recorded as a reduction of income tax
expense in the period realized.
(C) YEAR ENDED DECEMBER 31, 1994 STATEMENT OF OPERATIONS PRO FORMA
ADJUSTMENTS -- SALE OF PROPERTY TO UNIT PRODUCTION COMPANY AND LLOG EXPLORATION
COMPANY. On December 15, 1994, Patrick sold to Unit Petroleum Company its
interests in certain oil and gas wells and related acreage, personal property,
and contract rights. In connection with the Unit Sale, LLOG Exploration
Company exercised preferential purchase rights with respect to certain
properties Patrick had agreed to sell to Unit. The LLOG Exploration Sale
closed on December 16, 1994. Adjustments reflect the decrease in revenues,
other income, production tax and lease operating expenses and depletion related
to the properties sold. The decrease in interest expense reflects elimination
of interest on bank debt paid from proceeds of the sales and the decrease in
general and administrative expense reflects a reduction in personnel and other
general and administrative expenses directly related to the assets sold. In
addition for purposes of this pro forma presentation, the loss to Patrick on
the sale of the assets is also eliminated.
F - 12
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(D) YEAR ENDED DECEMBER 31, 1994 AND SIX MONTHS ENDED JUNE 30, 1995
STATEMENT OF OPERATIONS PRO FORMA ADJUSTMENTS -- ACQUISITION. The pro forma
adjustments applicable to the statements of operations assume the Transactions
took place as of January 1, 1994. Per unit information presented for La/Cal is
calculated using 19,765,226 units outstanding for the period which is equal to
the number of shares of Common Stock La/Cal received as a result of the Asset
Transfer.
(1) The Company follows the successful efforts method of acounting
for oil and gas properties and transactions, whereas Patrick followed the
full cost method. This entry adjusts Patrick's depletion, depreciation, and
amortization and impairment of oil and gas properties to an amount based on
fair value of oil and gas properties acquired assuming successful efforts
method of accounting for oil and gas properties and transactions. This
adjustment also records certain exploration costs of Patrick which should be
charged to expense in accordance with the successful efforts method of
accounting. Such amounts were $1,133,000 for the year 1994 and $ -0- for
the six months ended June 30, 1995.
(2) Reflects adjustment for the reduction in interest expense due to
the repayment of the outstanding indebtedness of Patrick.
(3) Reflects elimination of Penske dividends received for the year
ended December 31, 1994 and the six months ended June 30, 1995, respectively.
(4) To reflect increase in exploration expenses by $1,700,000 and
$180,000 for the year 1994 and six months ended June 30,1995, respectively,
and increase in general and administrative expenses by $203,000 and
$100,736 for the year 1994 and six months ended June 30, 1995, respectively,
for such costs capitalized by Patrick under the full cost accounting method.
Under the successful efforts method of accounting such costs are charged to
operations.
Goodrich Oil Company has previously provided general and
administrative services for La/Cal at no cost. The Company began providing
its own general and administrative services upon the closing of the
Transactions. However, based on the Company's anticipated level of
operations on a merged basis, such expenses are anticipated to be less than
the combined general and administrative expense of La/Cal and Patrick
immediately prior to the consummation of the Transactions. The Company
currently employs 10 people. During the year 1994 and the six months ended
June 30, 1995, Patrick employed a higher number of employees at a higher
average cost per employee. For pro forma purposes reductions in general and
administrative expenses that may occur have not been reflected.
(5) Pro forma income tax expense represents pro forma income taxes of
La/Cal's results of operations as if La/Cal had been treated as a
corporation. Such taxes were previously the responsibility of the
individual Partners. On a pro forma basis, no income tax expense is
reflected due to the availability to the Company of net operating loss
carryforwards of Patrick which can be used to offset income taxes otherwise
payable.
(6) New debt of the Company is at variable interest rates which are
estimated to average approximately 8%. A pro forma adjustment is made to
reflect 1) the lower interest rate to be incurred by the Company versus that
of La/Cal and 2) the lower level of amortization of deferred financing
costs. For pro forma purposes, for each one- eighth percentage point change
in the interest rate, interest expense would change by $13,125 per year.
(7) Reflects elimination of expenses of the Transactions in the
amount of $362,000 which was recorded by Patrick as general and
administrative expenses for the six months ended June 30, 1995.
F - 13
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(8) Combined pro forma income (loss) before extraordinary item per
common share is computed by dividing combined pro forma income before
extraordinary item applicable to common stock by the combined pro forma
weighted average share of common stock outstanding of 39,530,452.
Outstanding warrants and options considered common stock equivalents are not
included in the calculation because their effect would be antidilutive.
(9) Nonrecurring charges related to the early retirement of certain
long-term debt of Patrick and La/Cal, totaling $502,000 which will be
charged to expense as an extraordinary item subsequent to the Transactions
are not reflected in the pro forma statement of operations.
(E) IMPACT OF UNUSUAL ITEM. During 1994, Patrick sold a portion of
its investment in Penske and realized a gain of $6,754,000 on the sale which is
included in net gain on sale of investments in the historical statement of
operations of Patrick. If this unusual item were eliminated from the unaudited
pro forma condensed statement of operations for the year ended December 31,
1994, the following pro forma amounts would have resulted:
Year Ended
December 31,
1994
-----------
Total revenues................................................... $ 9,082,360
Income (loss) before extraordinary item.......................... (3,657,956)
Income (loss) before extraordinary item applicable
to common stock................................................ (4,597,956)
Income (loss) before extraordinary
item per common share.......................................... (.12)
(F) PRO FORMA BOOK VALUE PER SHARE.
Pro forma book value applicable to Common Stock per share is computed
by reducing total stockholders' equity by $11,750,000, which is the liquidation
preference applicable to the Company's preferred stock, divided by the number
of the Company's common shares outstanding.
F - 14
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the registrant has duly caused this report to be signed on its behalf
by the undersigned, hereunto duly authorized.
GOODRICH PETROLEUM CORPORATION
By: /s/ WALTER G. GOODRICH
----------------------
Walter G. Goodrich
President and Chief Executive Officer
Dated: October 24, 1995
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(C) EXHIBITS:
23.1 Consent of KPMG Peat Marwick LLP
23.2 Consent of Deloitte & Touche LLP