-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, KrK8tRApLHS9Ib1B4n76C6QQvDdMQql3ER6rp6A26jgW9JLNnEzOutWx+56LLXiO nJghEdnP5z822PPBP0iI4A== 0000930661-97-001905.txt : 19970813 0000930661-97-001905.hdr.sgml : 19970813 ACCESSION NUMBER: 0000930661-97-001905 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970630 FILED AS OF DATE: 19970812 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: CODA ENERGY INC CENTRAL INDEX KEY: 0000356799 STANDARD INDUSTRIAL CLASSIFICATION: CRUDE PETROLEUM & NATURAL GAS [1311] IRS NUMBER: 751842480 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-10955 FILM NUMBER: 97657034 BUSINESS ADDRESS: STREET 1: 5735 PINELAND DR STREET 2: STE 300 CITY: DALLAS STATE: TX ZIP: 75231 BUSINESS PHONE: 2146921800 MAIL ADDRESS: STREET 1: 5735 PINELAND DRIVE STREET 2: SUITE 300 CITY: DALLAS STATE: TX ZIP: 75231 FORMER COMPANY: FORMER CONFORMED NAME: CHAPMAN ENERGY INC DATE OF NAME CHANGE: 19891012 FORMER COMPANY: FORMER CONFORMED NAME: DALLAS SUNBELT ENERGY INC DATE OF NAME CHANGE: 19821116 10-Q 1 FORM 10-Q UNITED STATES 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 quarterly period ended JUNE 30, 1997 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from __________ to __________ Commission File Number 0-10955 CODA ENERGY, INC. (Exact name of registrant as specified in its charter) Delaware 75-1842480 (State of incorporation) (IRS Employer Identification No.) 5735 Pineland Dr., Suite 300, Dallas, Texas 75231 (Address of principal executive offices) (Zip Code) Registrant's Telephone Number, Including Area Code: (214) 692-1800 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. Common Stock, $.01 Par Value 913,611 Shares Outstanding at August 1, 1997 PART I - FINANCIAL INFORMATION FINANCIAL STATEMENTS CODA ENERGY, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS ASSETS ------ (in thousands)
June 30, December 31, 1997 1996 (Unaudited) --------------------------- Current Assets: Cash and cash equivalents $ 7,994 $ 6,296 Accounts receivable - revenue 14,432 9,539 Accounts receivable - joint interest and other 1,673 2,099 Other current assets 1,046 877 -------- -------- 25,145 18,811 -------- -------- Oil and gas properties (full cost accounting method): Proved oil and gas properties 249,693 268,610 Unproved oil and gas properties 1,000 1,000 Less accumulated depletion, depreciation and amortization (20,757) (32,312) -------- -------- 229,936 237,298 -------- -------- Gas plants and gathering systems 34,258 36,249 Less accumulated depreciation (2,305) (3,647) -------- -------- 31,953 32,602 -------- -------- Other properties and assets, net 8,536 8,732 -------- -------- $295,570 $297,443 ======== ========
See Notes to Consolidated Financial Statements 1 CODA ENERGY, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS LIABILITIES AND SHAREHOLDERS' EQUITY ------------------------------------ (dollars in thousands)
June 30, December 31, 1997 1996 (Unaudited) --------------------------- Current liabilities: Current maturities of long-term debt and notes payable $ 120 $ --- Accounts payable - trade 8,934 7,448 Accounts payable - revenue and other 5,210 4,271 Accrued interest 3,366 3,113 Income taxes payable 579 391 -------- -------- 18,209 15,223 -------- -------- Long-term debt - less current maturities 64,966 68,100 -------- -------- 10 1/2% Senior Subordinated Notes 110,000 110,000 -------- -------- Deferred income taxes 37,061 37,728 -------- -------- Commitments and contingent liabilities 15% Cumulative redeemable preferred stock, 40,000 shares of $.01 par value authorized; 20,000 shares issued and outstanding; liquidation preference of $24,476 at June 30, 1997, including dividends in arrears 20,000 20,000 -------- -------- Common stockholders' equity of management, subject to put and call rights, 13,611 shares of $.01 par value common stock issued and outstanding 4,560 4,560 Less related notes receivable (937) (937) -------- -------- 3,623 3,623 -------- -------- Other common stockholders' equity: Common stock, 1 million shares, $.01 par value, authorized, 900,000 shares issued and outstanding 9 9 Additional paid-in capital 89,991 89,991 Retained deficit (48,289) (47,231) -------- -------- 41,711 42,769 -------- -------- $295,570 $297,443 ======== ========
See Notes to Consolidated Financial Statements 2 CODA ENERGY, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited, in thousands)
Predecessor | Successor -----------------|--------------------------------------------------------------------------------- | Three Months Pro Forma Six Three Months Six Months 47 Days Ended | 134 Days Ended Ended Months Ended Ended Ended February 16, | June 30, June 30, June 30, June 30, June 30, 1996 | 1996 1996 1996 1997 1997 ------------ | --------------- ------------ ------------- ------------ ---------- | Revenues: | Oil and gas sales $ 8,079 | $ 28,403 $19,439 $36,482 $ 17,737 $37,305 Gas gathering and | processing 5,322 | 15,338 10,539 20,660 9,546 21,957 Other income 168 | 668 467 836 243 614 -------- | --------- ------- ------- -------- ------- 13,569 | 44,409 30,445 57,978 27,526 59,876 -------- | --------- ------- ------- -------- ------- Costs and expenses: | Oil and gas production 3,607 | 12,101 8,216 15,708 8,438 17,010 Gas gathering and | processing 4,567 | 12,628 8,740 17,195 8,272 18,958 Depletion, | depreciation and | amortization 2,583 | 10,510 7,012 13,909 6,821 13,440 | General and | administrative 320 | 876 524 1,196 232 430 Interest 1,102 | 6,400 4,313 8,613 4,092 8,077 Stock option | compensation 3,199 | --- --- --- --- --- Writedown of oil and | gas properties --- | 83,305 --- --- --- --- -------- | --------- ------- ------- -------- ------- 15,378 | 125,820 28,805 56,621 27,855 57,915 -------- | --------- ------- ------- -------- ------- | Income (loss) before | income taxes (1,809) | (81,411) 1,640 1,357 (329) 1,961 | Income tax expense | (benefit) (511) | (29,222) 693 690 (26) 903 -------- | --------- ------- ------- -------- ------- | Net income (loss) (1,298) | (52,189) 947 667 (303) 1,058 | Preferred stock dividend | requirements --- | 1,106 745 1,500 885 1,738 -------- | --------- ------- ------- -------- ------- | Net income (loss) | available for common | stockholders ($1,298) | ($53,295) $ 202 ($ 833) ($1,188) ($680) ======== | ========= ======= ======= ======== =======
See Notes to Consolidated Financial Statements 3 CODA ENERGY, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited, in thousands)
Predecessor | Successor ---------------|----------------------- | 47 Days | 134 Days Six Months Ended | Ended Ended February 16, | June 30, June 30, 1996 | 1996 1997 ------------ | ---------- ----------- | Cash flows from operating activities: | Net income (loss) ($1,298) | ($52,189) $ 1,058 Adjustments to reconcile net income | (loss) to net cash provided by | operating activities: | Depletion, depreciation and | amortization 2,583 | 10,510 13,440 Writedown of oil and gas | properties --- | 83,305 --- Deferred income tax expense | (benefit) (511) | (29,443) 667 Stock option compensation 3,199 | --- --- Other 6 | (107) (4) Effect of changes in: | Accounts receivable 3,386 | (2,837) 4,467 Other current assets (63) | 273 169 Accounts payable and other | current liabilities (4,166) | 7,468 (2,866) -------- | --------- -------- Net cash provided by | operating activities 3,136 | 16,980 16,931 -------- | --------- -------- | Cash flows from investing activities: | Additions to oil and gas properties (1,717) | (4,525) (22,389) Proceeds from sale of assets 110 | 623 3,477 Purchase of Coda by JEDI, net of | $5,740 cash acquired --- | (174,373) --- Gas plant and gathering systems and | other property additions (114) | (176) (2,086) Loan to stockholder --- | --- (450) Payments received on amounts due | from stockholders 130 | 124 --- -------- | --------- -------- Net cash used by | investing activities (1,591) | (178,327) (21,448) -------- | --------- -------- | Cash flows from financing activities: | Proceeds from bank borrowings --- | --- 15,000 Proceeds from issuance of | subordinated debt --- | 210,000 --- Proceeds from issuance of common and | preferred stock --- | 110,026 --- Repayment of bank borrowings and | subordinated debt (19) | (149,850) (11,986) Financing costs (390) | (716) (195) -------- | --------- -------- Net cash provided (used) | by financing activities (409) | 169,460 2,819 -------- | --------- -------- | Increase (decrease) in cash 1,136 | 8,113 (1,698) Cash at beginning of period 4,604 | --- 7,994 -------- | --------- -------- Cash at end of period $ 5,740 | $ 8,113 $ 6,296 ======== | ========= ======== | Supplemental cash flow information: | Interest paid $ 1,544 | $ 2,863 $ 8,330 ======== | ========= ======== Income taxes paid $ --- | $ 120 $ 424 ======== | ========= ========
See Notes to Consolidated Financial Statements 4 CODA ENERGY, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Unaudited) 1. THE MERGER On February 16, 1996, pursuant to an Agreement and Plan of Merger, Coda Energy, Inc. ("Coda"), was acquired by Joint Energy Development Investments Limited Partnership ("JEDI"), which is an affiliate of Enron Capital & Trade Resources Corp. ("ECT") (the "Merger"). Coda, together with its subsidiaries, prior to and including February 16, 1996 is referred to herein as the Predecessor and after such date as the Successor and collectively, for both periods, the Company. In conjunction with the Merger, JEDI entered into certain agreements with members of the Company's management (the "Management Group"), providing for a continuing role of management in the Company after the Merger. Following consummation of the Merger, the Management Group owns approximately 5% of Coda's common stock on a fully-diluted basis. JEDI owns the remaining 95%. The Merger has been accounted for using the purchase method of accounting. As such, JEDI's cost of acquiring Coda has been allocated to the assets and liabilities acquired based on estimated fair values. As a result, the Company's financial position and operating results subsequent to the date of the Merger reflect a new basis of accounting and are not comparable to prior periods. The allocation of JEDI's purchase price to the assets and liabilities of Coda resulted in a significant increase in the carrying value of the Company's oil and gas properties. Under the full cost method of accounting, the carrying value of oil and gas properties (net of related deferred taxes) is generally not permitted to exceed the sum of the present value (10% discount rate) of estimated future net cash flows (after tax) from proved reserves, based on current prices and costs, plus the lower of cost or estimated fair value of unproved properties (the "cost center ceiling"). Based upon the allocation of JEDI's purchase price and estimated proved reserves and product prices in effect at the date of the Merger, the purchase price allocated to oil and gas properties was in excess of the cost center ceiling by approximately $83.3 million ($53.3 million net of related deferred taxes). The resulting writedown was a non-cash charge and was included in the results of operations for the 134- day period ended June 30, 1996. 2. ACCOUNTING AND REPORTING POLICIES The consolidated financial statements include the accounts of Coda and its majority-owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. Certain reclassifications have been made to prior years' amounts to conform to the current year presentation. The accompanying consolidated financial statements, which should be read in conjunction with the audited consolidated financial statements for the 319-day period ended December 31, 1996, reflect 5 all adjustments (consisting only of normal recurring accruals) which are, in the opinion of management, necessary to present fairly the financial position as of June 30, 1997, and the results of operations and cash flows for the 47 day period ended February 16, 1996, the 134 day period ended June 30, 1996 and the six months ended June 30, 1997. The results for the period ended June 30, 1997, are not necessarily indicative of results for a full year. Fees from overhead charges billed to working interest owners, including the Company, of $848,000, $2.5 million and $3.5 million for the 47 day period ended February 16, 1996, the 134 day period ended June 30, 1996 and the six months ended June 30, 1997, respectively, have been classified as a reduction of general and administrative expenses in the accompanying consolidated statements of operations. 3. PRO FORMA INFORMATION The pro forma statement of operations information was prepared as if the Merger and the sale of the 10 1/2% Senior Subordinated Notes (the "Notes") had occurred on January 1, 1996. The pro forma information does not purport to represent the results of operations which would have occurred had such transactions been consummated on January 1, 1996 or for any future period. The pro forma information was prepared by adjusting the 1996 periods: (i) to adjust depletion, depreciation, and amortization to reflect JEDI's purchase price allocated to property and equipment, (ii) to adjust interest expense to give effect to the net reduction of approximately $37.0 million under the Company's credit facility and repayment of a note payable to an officer of the Company, partially offset by an increase in the interest rate on borrowings under the new credit facility of .25%, (iii) to record interest on the Notes at an interest rate of 10 1/2%, (iv) to record amortization of the issuance cost of the Notes over the term such debt is expected to be outstanding (10 years), (v) to adjust the writedown of oil and gas properties and stock option compensation to eliminate these non-recurring charges related to the Merger, (vi) to adjust the provision for income taxes for the change in financial taxable income resulting from the above adjustments, and (vii) to record the cumulative dividend requirements of the redeemable preferred stock issued to JEDI. 4. ACQUISITIONS In February 1997, the Company purchased 123 producing oil and gas properties from J. M. Huber Corporation for an aggregate purchase price of approximately $13.5 million, of which $6.5 million was financed under the Company's credit agreement. The properties are predominately located in Texas, Oklahoma and Arkansas. The Company estimates the properties have proved reserves of approximately 1.6 million barrels of oil and 15.1 Bcf of gas as of the effective date, January 1, 1997. 5. LONG-TERM DEBT On February 14, 1996, the Company entered into a credit agreement with NationsBank of Texas, N.A. ("NationsBank"), as lender and as agent, and additional lenders named therein (as amended, the "Credit Agreement") which provides for a revolving credit facility in an amount up to $250.0 million. 6 Pursuant to the terms of the Credit Agreement, the semiannual borrowing base redetermination as of April 1, 1997, resulted in an increase of the Company's borrowing base from $115 million to $120 million. The next redetermination is scheduled for October 31, 1997. At June 30, 1997, $68.0 million was outstanding under the Credit Agreement and $52.0 million was available for borrowing thereunder. On March 31, 1997, the Company repaid in full (principal balance of $466,000) it's note payable to NationsBank that was due January 2, 1998. 6. 10 1/2% SENIOR SUBORDINATED NOTES On March 18, 1996, the Company completed the sale of the Notes which bear interest at an annual rate of 10 1/2% payable semiannually in arrears on April 1 and October 1 of each year. The Notes are general, unsecured obligations of the Company, are subordinated in right of payment to all Senior Debt (as defined in the indenture governing the Notes (the "Indenture") of Coda, and are senior in right of payment to all future subordinated debt of the Company. The claims of the holders of the Notes are subordinated to Senior Debt, which, as of June 30, 1997, was $68.1 million. The Notes were issued pursuant to the Indenture, which contains certain covenants that, among other things, limit the ability of Coda and its Restricted Subsidiaries (as defined in the Indenture) to incur additional indebtedness and issue Disqualified Stock (as defined in the Indenture), pay dividends, make distributions, make investments, make certain other restricted payments, enter into certain transactions with affiliates, dispose of certain assets, incur liens securing pari passu or subordinated indebtedness of Coda and engage in mergers and consolidations. Coda's payment obligations under the Notes are fully, unconditionally and jointly and severally guaranteed on a senior subordinated basis by all of Coda's current subsidiaries and future Restricted Subsidiaries. Such guarantees are subordinated to the guarantees of Senior Debt issued by the Guarantors (as defined in the Indenture) under the Credit Agreement and to other guarantees of Senior Debt issued in the future. All of Coda's current subsidiaries are wholly owned. There are currently no restrictions on distributions from the Guarantors to Coda. Separate financial statements and other disclosures concerning the Guarantors are not presented because management has determined they are not material to investors. The combined condensed financial information of the Company's current subsidiaries, the Guarantors, is as follows: 7
December 31, June 30, 1996 1997 ------------ ---------- (Unaudited) Current assets $ 7,745 $ 3,991 Oil and gas properties, net 50,176 50,776 Gas plants and gathering systems, net 31,617 32,266 Other properties and assets, net 1,113 875 ------- ------- Total assets $90,651 $87,908 ======= ======= Current liabilities $ 8,321 $ 6,823 Intercompany payables 33,551 28,536 Deferred income taxes 16,191 17,553 Stockholder's equity 32,588 34,996 ------- ------- Total liabilities and stockholder's equity $90,651 $87,908 ======= =======
Predecessor | Successor ---------------|----------------------- | 47 Days | 134 Days Six Months Ended | Ended Ended February 16, | June 30, June 30, 1996 | 1996 1997 ------------ | ---------- ----------- (Unaudited) | (Unaudited) (Unaudited) | Revenues: | Oil and gas sales $2,529 | $10,257 $12,144 Gas gathering and processing 5,322 | 15,338 21,957 Other income 2 | 100 24 ------ | ------- ------- 7,853 | 25,695 34,125 | Costs and expenses: | Oil and gas production 843 | 2,868 3,742 Gas gathering and processing 4,567 | 12,628 18,958 Depletion, depreciation and | amortization 1,039 | 4,152 4,982 General and administrative 435 | 1,401 1,484 Interest 460 | 1,216 953 Writedown of oil and gas | properties --- | 19,159 --- ------ | ------- ------- 7,344 | 41,424 30,119 ------ | ------- ------- Income (loss) before income taxes 509 | (15,729) 4,006 Income tax expense (benefit) 277 | (5,607) 1,598 ------ | ------- ------- Net income (loss) $ 232 | ($10,122) $ 2,408 ====== | ======== =======
8 7. PREFERRED STOCK Under Coda's Restated Certificate of Incorporation, the Board of Directors is authorized to issue up to 40,000 shares of preferred stock, par value $0.01 per share. All 40,000 shares of preferred stock are designated as "15% Cumulative Preferred Stock" (the "Preferred Stock"). The holders of each share of Preferred Stock are entitled to receive, when and as declared by the Board of Directors, cumulative preferential dividends, at the rate of $150.00 per share per annum. There are currently 20,000 shares of Preferred Stock issued and outstanding. Shares of Preferred Stock in excess of such 20,000 shares are issuable only for the purpose of paying dividends on the Preferred Stock. As of June 30, 1997, the Preferred Stock had accumulated approximately $4.5 million in preferred dividends which had not been declared by the Board of Directors. 9 Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL ------------------------------------------------- CONDITION AND RESULTS OF OPERATIONS ----------------------------------- The Company is an independent energy company principally engaged in the acquisition and exploitation of producing oil and natural gas properties. The Company also owns and operates natural gas processing and liquids extraction facilities and natural gas gathering systems. Coda seeks to acquire properties whose predominant economic value is attributable to proved producing reserves and to enhance that value through control of operations, reduction of costs and development of properties. The Company's principal strategy is to increase oil and natural gas reserves and cash flow by selectively acquiring and exploiting producing oil and natural gas properties, especially those properties with enhanced recovery and other lower risk development potential. Coda's exploitation efforts include, where appropriate, the drilling of lower risk development wells, the initiation of secondary recovery projects, the renegotiation of marketing agreements and the reduction of drilling, completion and lifting costs. Cost savings may be principally achieved through reductions in field staff and the more effective utilization of field facilities and equipment by virtue of geographic concentration. The Company expects to continue its efforts to acquire additional oil and natural gas properties. Future acquisitions, if any, would necessitate, in most cases, borrowing additional funds under the Company's credit facility. The ability to borrow such funds is dependent upon the Company's borrowing base from time to time and the effect upon the borrowing base of the properties to be acquired. On February 16, 1996, pursuant to an Agreement and Plan of Merger, Coda was acquired by Joint Energy Development Investments Limited Partnership ("JEDI"), which is an affiliate of Enron Capital & Trade Resources Corp. ("ECT") (the "Merger"). Coda, together with its subsidiaries, prior to and including February 16, 1996 is referred to herein as the Predecessor and after such date as the Successor and collectively, for both periods, the Company. The Merger has been accounted for using the purchase method of accounting. As such, JEDI's cost of acquiring Coda has been allocated to the assets and liabilities acquired based on estimated fair values. As a result, the Company's financial position and operating results subsequent to the date of the Merger reflect a new basis of accounting and are not comparable to prior periods. FORWARD-LOOKING STATEMENTS All statements in this document concerning the Company other than purely historical information (collectively "Forward-Looking Statements") reflect the current expectation of management and are based on the Company's historical operating trends, estimates of proved reserves and other information currently available to management. These statements assume, among other things, (i) that no significant changes will occur in the operating environment for the Company's oil and gas properties, gas plants and gathering systems and (ii) that there will be no material acquisitions or 10 divestitures. The Company cautions that the Forward-Looking Statements are subject to all the risks and uncertainties incident to the acquisition, development and marketing of, and exploration for, oil and gas reserves. These risks include, but are not limited to, commodity price risk, environmental risk, drilling risk, reserve, operations and production risks, regulatory risks and counterparty risk. Many of these risks are described elsewhere herein. The Company may make material acquisitions or dispositions, enter into new or terminate existing oil and gas sales or hedging contracts, or enter into financing transactions. None of these can be predicted with any certainty and, accordingly, are not taken into consideration in the Forward-Looking Statements made herein. For all of the foregoing reasons, actual results may vary materially from the Forward-Looking Statements and there is no assurance that the assumptions used are necessarily the most likely. 11 RESULTS OF OPERATIONS The following table sets forth certain unaudited operating data regarding the production and sales volumes, average sales prices, and costs associated with the Company's oil and gas operations and gas gathering and processing operations for the periods indicated.
Predecessor | Successor -----------------|--------------------------------------------------------------------------------- | Three Months Pro Forma Six Three Months Six Months 47 Days Ended | 134 Days Ended Ended Months Ended Ended Ended February 16, | June 30, June 30, June 30, June 30, June 30, 1996 | 1996 1996 1996 1997 1997 ------------ | --------------- ------------ ------------- ------------ ---------- | OIL AND GAS OPERATING DATA: | Net production: | Oil (Mbbls) 408 | 1,307 880 1,715 824 1,632 Gas (Mmcf) 500 | 1,378 866 1,878 1,173 2,262 | Average sales price: | Oil (per Bbl) $ 17.57 | $ 19.54 $ 19.86 $ 19.07 $ 18.72 $ 19.62 Gas (per Mcf) $ 1.82 | $ 2.08 $ 2.27 $ 2.01 $ 1.97 $ 2.34 | Average production cost $ 7.33 | $ 7.87 $ 8.02 $ 7.75 $ 8.28 $ 8.47 per BOE | | GAS GATHERING AND | PROCESSING OPERATING DATA: | | Sales: | Gas sales (MMBTU) 1,555 | 4,479 3,049 6,034 3,204 6,308 Gas sales average price $ 2.24 | $ 2.20 $ 2.26 $ 2.21 $ 2.05 $ 2.46 Natural gas liquids | sales (M gallons) 5,868 | 16,862 11,375 22,730 9,863 19,200 Natural gas liquids | average price $0.3173 | $0.3248 $0.3216 $0.3228 $0.3015 $0.3357 | Costs and expenses (in | thousands): | Gas purchases $ 3,760 | $11,384 $ 7,994 $15,444 $ 7,421 $16,793 Plant operating expenses $ 506 | $ 1,464 $ 965 $ 1,970 $ 1,031 $ 2,165
Comparison of the six months ended June 30, 1996 (pro forma) and 1997 (historical) The unaudited pro forma combined information was prepared as if the Merger and the issuance of $110.0 million of 10 1/2% Senior Subordinated Notes (the "Notes") had occurred on January 1, 1996. The unaudited pro forma information was prepared by combining the two 1996 periods and giving effect to adjustments affecting (i) depletion, depreciation and amortization, (ii) interest expense, (iii) income taxes and (iv) certain other costs resulting from the Merger as more fully 12 outlined in the Notes to Consolidated Financial Statements. The comparisons below compare the unaudited pro forma information for the six months ended June 30, 1996 to unaudited historical information for the six months ended June 30, 1997. Unless otherwise indicated, the variation and trend analysis set forth below in comparing the six months ended June 30, 1996 and 1997 is comparable to the analysis that would result from comparing the quarters ended June 30, 1996 and 1997. Oil and gas sales for the six months ended June 30, 1997, increased 2% to approximately $37.3 million from approximately $36.5 million in the comparable period in 1996 primarily due to an increase of $2.55 per barrel and $.33 per Mcf in the average sales price of oil and gas, respectively, partially offset by a 5% decrease in oil production. The decrease in oil production is primarily a result of natural declines in production partially offset by production from acquisitions in December 1996 and February 1997. The Company also experienced a 20% increase in gas volumes as a result of the acquisition of oil and gas properties in February 1997 and favorable drilling results in 1996 and 1997. During the six months ended June 30, 1997, 86% of oil and gas sales revenues were attributable to oil production. Oil and gas sales for the quarter ended June 30, 1997 decreased 9% to approximately $17.7 million from approximately $19.4 million in the comparable period in 1996 primarily due to a decrease of $1.14 per barrel and $.30 per Mcf in the average sales price of oil and gas, respectively, and by a 6% decrease in oil production. The decrease in oil production results from natural production declines which were partially offset by production from acquisitions in December 1996 and February 1997. The Company also experienced a 35% increase in gas volumes as a result of the acquisition of oil and gas properties in February 1997 and favorable drilling results in 1996 and 1997. Oil and gas sales for the quarter ended June 30, 1997 decreased approximately 9% to $17.7 million from approximately $20.0 million for the quarter ended March 31, 1997 primarily due to a price decrease of $1.82 per barrel and $.76 per Mcf in the average sales price of oil and gas, respectively. Oil and gas prices remain unpredictable. See "- Changes in Prices and Hedging Activities" below. Gas gathering and processing revenues for the six months ended June 30, 1997 increased 6% to approximately $22.0 million from approximately $20.7 million in the comparable period in 1996 primarily due to an 11% and a 4% increase in the average sales price for gas and natural gas liquids, respectively. This increase was partially offset by a 16% decrease in natural gas liquids volumes due primarily to natural production declines. Gas gathering and processing revenues for the quarter ended June 30, 1997 decreased 9% to approximately $9.5 million from approximately $10.5 million in the comparable period in 1996 primarily due to a 9% and a 6% decrease in the average sales price for gas and natural gas liquids, respectively. This decrease was compounded by a 13% decrease in natural gas liquids sales volumes due primarily to natural production declines. 13 Gas gathering and processing revenues for the quarter ended June 30, 1997 decreased 23% to approximately $9.5 million from approximately $12.4 million for the quarter ended March 31, 1997 primarily due to a 29% and a 19% decrease in the average sales price for gas and natural gas liquids, respectively. This decrease was partially offset by a 6% increase in natural gas liquids sales volumes. Gas gathering and processing expenses for the six months ended June 30, 1997 increased 10% to approximately $19.0 million from approximately $17.2 million in the comparable period in 1996 due primarily to an increase in the purchase price paid to producers. Gas gathering and processing expenses usually fluctuate in ratio with gas gathering and processing revenues. Oil and gas production expenses (including production taxes) for the six months ended June 30, 1997 increased 8% to approximately $17.0 million from approximately $15.7 million for the same period in 1996, reflecting the effects of the properties acquired in 1996 and 1997 and from new wells drilled. Oil and gas production expenses for the six months ended June 30, 1997 were $8.47 per BOE and are expected to remain near this level for the remainder of the year. Depletion, depreciation and amortization expense for the six months ended June 30, 1997, decreased 3% to approximately $13.4 million from approximately $13.9 million for the pro forma period in 1996 reflecting the effect on depletion, depreciation and amortization rates of upward reserve revisions at December 31, 1996 and acquisitions in December 1996 and February 1997. Oil and gas depletion, depreciation and amortization expense decreased from $5.94 per BOE for the six months ended June 30, 1996, to $5.75 per BOE for the six months ended June 30, 1997. The Company anticipates that the depletion, depreciation and amortization rate per BOE will be approximately $5.75 for 1997, absent significant additional acquisitions or reserve revisions. General and administrative expenses for the six months ended June 30, 1997 decreased 64% to approximately $430,000 from approximately $1.2 million for the same period in 1996. This decrease is primarily due to an accrual for bonuses of $378,000 in 1996 but not in 1997. Also contributing to the decrease were additional overhead charges of $112,000 billed to working interest owners on the properties acquired in December 1996 and February 1997. The Company expects that general and administrative expenses for the year ended December 31, 1997 will be near 1996 levels, absent significant additional acquisitions. Interest expense for the six months ended June 30, 1997 decreased 6% to approximately $8.1 million from approximately $8.6 million for the comparable period in 1996, primarily due to decreases in outstanding debt levels as a result of utilizing available cash flow to reduce amounts outstanding under the Company's credit facility. Net income for the six months ended June 30, 1997, was approximately $1.1 million compared to approximately $667,000 for the comparable period in 1996. This increase resulted primarily from higher oil and gas prices and decreases in general and administrative expenses. Net loss for the quarter ended June 30, 1997 was $303,000 compared to net income for the quarter ended March 31, 14 1997 of $1.4 million. This decrease resulted primarily from a drop in oil and gas prices during the second quarter of 1997. CHANGES IN PRICES AND HEDGING ACTIVITIES Annual average oil and natural gas prices have fluctuated significantly over the past three years. The Company's weighted average oil price per barrel during 1996 and at December 31, 1996, was $20.22 and $24.88, respectively. For the six months ended June 30, 1997, the Company received an average of $1.75 per barrel less (including an oil hedging price decrease of $.80 per barrel) and $.09 per Mcf more for its oil and natural gas sales, respectively, than the average NYMEX prices for the same period. On July 31, 1997, the NYMEX closing price for the near month for oil and natural gas was $20.14 per barrel and $2.18 per Mcf, respectively. In an effort to reduce the effects of the volatility of the price of oil and natural gas on the Company's operations, management has adopted a policy of hedging oil and natural gas prices on a portion of the Company's production through the use of commodity futures, options, and swap agreements whenever market prices are in excess of the prices anticipated in the Company's operating budget and profit plan. While the use of these hedging arrangements limits the downside risk of adverse price movements, it may also limit future gains from favorable movements. All hedging is accomplished pursuant to exchange-traded contract or master swap agreements based upon standard forms. The Company addresses market risk by selecting instruments whose value fluctuations correlate strongly with the underlying commodity being hedged. Credit risk related to hedging activities, which is minimal, is managed by requiring minimum credit standards for courterparties, periodic settlements and mark-to-market valuations. Under the standard form swap and option agreements in use by the Company, the Company's revenues will be limited when the NYMEX price exceeds the strike price. The total potential reduction in revenues is equal to the difference between the strike prices and the NYMEX price for the production month hedged multiplied by the number of barrels swapped. To the extent this amount exceeds the credit limit established by the counterparty, the Company may be required to utilize cash to fund a margin account. The Company has not historically been required to provide any significant amount of collateral in connection with its hedging activities. The Company has sold swaps to hedge 315,000 barrels of oil and 60,000 barrels of oil at a weighted average NYMEX price of $19.24 and $19.41 per barrel for the six months ending December 31, 1997 and year ending December 31, 1998, respectively, under various transactions entered into as of June 30, 1997. As of June 30, 1997 the Company had open positions for sold call options covering 25,000 barrels of oil per month at an option price of $20.00 per barrel for July and August 1997. In connection with a swap beginning January 1, 1997 covering 15,000 barrels per month at a strike price of $19.00, which expires December 31, 1997, the Company granted the counterparty a one day option at the expiration of the swap to extend the swap under the same terms for an additional twelve months. 15 During the 47 day period ended February 16, 1996, the 134 day period ended June 30, 1996 and the six months ended June 30, 1997 the Company's oil revenues were decreased by $14,000, $1.1 million and $1.3 million, respectively, as a result of hedging transactions. LIQUIDITY AND CAPITAL RESOURCES At June 30, 1997, the Company had cash and cash equivalents of approximately $6.3 million and working capital of approximately $3.6 million. Cash provided by operating activities for the six months ended June 30, 1997 decreased to approximately $16.9 million compared to $20.1 million for the comparable period in 1996 due primarily to changes in working capital items. The changes in working capital items account for approximately $2.3 million of the decrease in cash provided by operations. As a result of issuing the Notes in March 1996, accrued interest increased approximately $3.1 million which resulted in an increase to cash provided by operations in 1996 that did not recur in 1997. The other changes in working capital items are primarily oil and gas price related. Cash provided by operating activities before changes in working capital items for the six months ended June 30, 1997 decreased $844,000 to approximately $15.2 million from approximately $16.1 million from the comparable period in 1996 due to a decrease in margins on oil and gas operations and gas gathering and processing operations and higher interest expense related to the Notes partially offset by lower general and administrative expenses. Excluding the impact of the Merger, cash flows used in investing activities increased to $21.4 million for the six months ended June 30, 1997 from $5.5 million for the comparable period in 1996, primarily as a result of the acquisition in February 1997 of oil and gas properties for $13.5 million. Cash flows provided by financing activities decreased from $169.1 million for the six months ended June 30, 1996 to $2.8 million for the comparable period in 1997, primarily due to financing transactions related to the Merger. The Company has two principal operating sources of cash: (i) net oil and gas sales from its oil and gas properties and (ii) net margins earned from gas gathering and processing operations. The Company expects to continue its efforts to acquire additional oil and gas properties. Future acquisitions, if any, would necessitate, in most cases, borrowing additional funds under the Company's credit facility. The ability to borrow such funds is dependent upon the Company's borrowing base from time to time and the effect upon the borrowing base of the properties to be acquired. The Company from time to time entertains bids for selected portions of its existing oil and natural gas properties which it believes are no longer suitable for its business strategy. Sales of properties in the past three years have not been material, and no substantial sales of properties are currently under negotiation. The Company has development drilling programs designed for all its major operating areas. The Company has budgeted capital spending of between $15 million and $20 million in 1997, excluding property acquisitions, but is not contractually committed to expend these funds. During the first six months of 1997, the Company incurred approximately $7.4 million of these costs. In addition, the 16 Company is continuing to evaluate oil and natural gas properties for future acquisitions. As a result of being 95% owned by JEDI (on a fully diluted basis), the Company does not expect to utilize the public equity market to finance acquisitions in the near term. Accordingly, any material expenditures in connection with acquisitions would require borrowing under the Company's credit facility or from other sources. There can be no assurance that such funds will be available to the Company. Furthermore, the Company's ability to borrow in the future is subject to restrictions imposed by the Company's credit facility and the indenture governing the Notes (the "Indenture"). The Merger The Company incurred substantial indebtedness in connection with the Merger and is highly leveraged. As of June 30, 1997, the Company had total indebtedness of approximately $178.1 million and common stockholders' equity of approximately $46.4 million. Based upon the Company's current level of operations and anticipated growth, management of the Company believes that available cash, together with available borrowings under the Company's credit facility, will be adequate to meet the Company's anticipated future requirements for working capital, capital expenditures and scheduled payments of principal of, and interest on, its indebtedness, including the Notes. There can be no assurance that such anticipated growth will be realized, that the Company's business will generate sufficient cash flow from operations or that future borrowings will be available in an amount sufficient to enable the Company to service its indebtedness, including the Notes, or make necessary capital expenditures. The Company may find it necessary to refinance a portion of the principal amount of the Notes at or prior to their maturity. However, there can be no assurance that the Company will be able to obtain financing to complete a refinancing of the Notes. Credit Agreement On February 14, 1996, the Company entered into a credit agreement with NationsBank of Texas, N.A. ("NationsBank"), as lender and as agent, and additional lenders named therein (as amended, the "Credit Agreement"). Pursuant to the terms of the Credit Agreement, the semiannual borrowing base redetermination as of April 1, 1997 resulted in an increase of the Company's borrowing base from $115 million to $120 million. The next redetermination is scheduled for October 31, 1997. At June 30, 1997, $68.0 million was outstanding under the Credit Agreement and $52.0 million was available for borrowing thereunder. On March 31, 1997, the Company repaid in full (principal balance of $466,000) its note payable to NationsBank that was due January 2, 1998. 15% Cumulative Preferred Stock The Company's Restated Certificate of Incorporation authorizes the issuance of up to 40,000 shares of preferred stock par value, $0.01 per share, designated as "15% Cumulative Preferred Stock" (the "Preferred Stock"). In conjunction with the Merger, the Company issued 20,000 shares of Preferred Stock to JEDI for $20.0 million in cash. Shares of Preferred Stock in excess of such 20,000 shares are issuable only for the purpose of paying dividends on the Preferred Stock. The holders of each share of Preferred Stock are entitled to receive, when and as declared by the Board 17 of Directors, cumulative preferential dividends at the rate of $150.00 per share per annum. The payment of Preferred Stock dividends in cash is restricted by the Credit Agreement and the Indenture. As of June 30, 1997, the Preferred Stock had accumulated approximately $4.5 million in preferred dividends which had not been declared by the Board of Directors. 18 PART II - OTHER INFORMATION Item 6. EXHIBITS AND REPORTS ON FORM 8-K -------------------------------- (A) Exhibits 3.1 Restated Certificate of Incorporation of Coda filed as Exhibit 3.1 to the Company's Registration Statement on Form S-4 filed April 9, 1996 (Registration No 333-2375, the "1996 Form S-4") and incorporated by reference herein. 3.2 Amended and Restated Bylaws of Coda filed as Exhibit 3.2 to the 1996 Form S-4 and incorporated by reference herein. 3.3 Certificate of Incorporation of Diamond Energy Operating Company, as amended, filed as Exhibit 3.3 to the 1996 Form S-4 and incorporated by reference herein. 3.4 Bylaws of Diamond Energy Operating Company, as amended, filed as Exhibit 3.4 to the 1996 Form S-4 and incorporated by reference herein. 3.5 Articles of Incorporation of Taurus Energy Corp., as amended, filed as Exhibit 3.5 to the 1996 Form S-4 and incorporated by reference herein. 3.6 Bylaws of Taurus Energy Corp., as amended, filed as Exhibit 3.6 to the 1996 Form S-4 and incorporated by reference herein. 3.7 Articles of Incorporation of Electra Resources, Inc. filed as Exhibit 3.7 to the 1996 Form S-4 and incorporated by reference herein. 3.8 Bylaws of Electra Resources, Inc. filed as Exhibit 3.8 to the 1996 Form S-4 and incorporated by reference herein. 4.1 Indenture, dated as of March 18, 1996, among Coda, Coda's guarantor subsidiaries, Diamond Energy Operating Company, Taurus Energy Corp. and Electra Resources, Inc. (collectively, the "Guarantors"), and Texas Commerce Bank National Association, as trustee, relating to $110,000,000 aggregate principal amount of 10 1/2% Series A and Series B Senior Subordinated Notes due 2006 filed as Exhibit 4.1 to the 1996 Form S-4 and incorporated by reference herein. 4.2 Registration Rights Agreement, dated as of March 18, 1996, among Coda, the Guarantors and Goldman, Sachs, & Co., Chemical Securities, Inc., ECT Securities Corp. and NationsBanc Capital Markets, Inc. (collectively, the "Initial Purchasers") filed as Exhibit 4.2 to the 1996 Form S-4 and incorporated by reference herein. 19 4.3 Purchase Agreement, dated as of March 12, 1996, among Coda, the Guarantors and the Initial Purchasers filed as Exhibit 4.3 to the 1996 Form S-4 and incorporated by reference herein. 4.4 Credit Agreement, dated February 14, 1996, among the Company, individually and as agent, and additional lenders named therein, filed as Exhibit 4.5 to the 1996 Form S-4 and incorporated by reference herein. 4.5 Promissory Note dated February 14, 1996, in the original principal amount of $87,500,000.00, executed by Coda, payable to NationsBank filed as Exhibit 4.6 to the 1996 Form S-4 and incorporated by reference herein. 4.6 Promissory Note dated February 14, 1996, in the original principal amount of $37,500,000.00, executed by Coda, payable to Bank One, Texas, N.A. filed as Exhibit 4.7 to the 1996 Form S-4 and incorporated by reference herein. 4.7 Promissory Note dated February 14, 1996, in the original principal amount of $75,000,000.00, executed by Coda, payable to Texas Commerce Bank National Association filed as Exhibit 4.8 to the 1996 Form S-4 and incorporated by reference herein. 4.8 Promissory Note dated February 14, 1996, in the original principal amount of $50,000,000.00, executed by Coda, payable to the First National Bank of Boston filed as Exhibit 4.9 to the 1996 Form S-4 and incorporated by reference herein. 4.9 Specimen Certificate of Series B 10 1/2% Senior Subordinated Notes due 2006 (included in Exhibit 4.1 hereto), filed as Exhibit 4.11 to the 1996 Form S-4 and incorporated by reference herein. 4.10 First Supplement to Indenture dated as of April 25, 1996 filed as Exhibit 4.12 the Company's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 1996 and incorporated by reference herein amending the Indenture filed as Exhibit 4.1 above. 4.11 First Amendment to Credit Agreement, dated August 1, 1996, among the Company, NationsBank and additional lenders named therein, filed as Exhibit 4.13 to the Company's quarterly report on Form 10-Q for the quarterly period ended September 30, 1996 (the "September 1996 10-Q") and incorporated by reference herein amending the Credit Agreement filed as Exhibit 4.4 above. 10.1/(2)/ Form of Indemnification Agreement entered into between Coda and each of its directors and officers filed as Exhibit 10.1 to Coda's Annual Report on Form 10-K for the fiscal year ended December 31, 1994, and incorporated by reference herein. 20 10.2/(2)/ List of directors and officers that have entered into Indemnification Agreements with Coda filed as Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the quarterly period ended September 30, 1995, (the "September 1995 10-Q") and incorporated by reference herein. 10.3 Agreement and Plan of Merger, by and among Coda, JEDI and Coda Acquisition, Inc. dated as of October 30, 1995 filed as Exhibit 2.1 to Coda's Current Report on Form 8-K dated October 30, 1995 (the "October 1995 8-K"), and incorporated by reference herein. 10.4 Agreement of Coda to provide schedules to the Agreement and Plan of Merger (Exhibit 10.3) omitted pursuant to Item 6.01 (b)(2) of Regulation S-K filed as Exhibit 2.2 to the September 1995 10-Q, and incorporated by reference herein. 10.5 Amendment to Agreement and Plan of Merger dated as of December 22, 1995 filed as Exhibit 2.1 to Coda's Current Report on Form 8-K dated December 22, 1995, and incorporated by reference herein. 10.6 Second Amendment to Agreement and Plan of Merger dated as of January 10, 1996 filed as Exhibit 2.1 to Coda's Current Report on Form 8-K dated January 10, 1996, and incorporated by reference herein. 10.7 Agreement of Coda to provide schedules and exhibits to Second Amendment to Agreement and Plan of Merger (Exhibit 10.6) and to provide schedules to Amendment No. 1 to Subscription Agreement (Exhibit 10.18) and Amendment No. 1 to Stockholders Agreement (Exhibit 10.19) filed as Exhibit 99.4 to Coda's Current Report on Form 8-K dated January 10, 1996, and incorporated by reference herein. 10.8/(2)/ Stockholders Agreement dated October 30, 1995 filed as Exhibit 99.2 to the October 1995 8-K, and incorporated by reference herein. 10.9/(2)/ Subscription Agreement among Coda Acquisition, Inc. and The Management Investors dated October 30, 1995 filed as Exhibit 99.3 to the October 1995 8-K, and incorporated by reference herein. 10.10 Agreement of Coda to provide schedules to Stockholders Agreement (Exhibit 10.8) and to Subscription Agreement (Exhibit 10.9) filed as Exhibit 99.11 to the October 1995 8-K, and incorporated by reference herein. 10.11/(2)/ Business Opportunity Agreement dated as of October 30, 1995 filed as Exhibit 99.4 to the October 1995 8-K, and incorporated by reference herein. 21 10.12/(2)/ Executive Employment Agreement between Coda Acquisition, Inc. and Randell A. Bodenhamer filed as Exhibit 99.5 to the October 1995 8- K, and incorporated by reference herein. 10.13/(2)/ Executive Employment Agreement between Coda Acquisition, Inc. and J. William Freeman filed as Exhibit 99.6 to the October 1995 8-K, and incorporated by reference herein. 10.14/(2)/ Executive Employment Agreement between Coda Acquisition, Inc. and Grant W. Henderson filed as Exhibit 99.7 to the October 1995 8-K, and incorporated by reference herein. 10.15/(2)/ Executive Employment Agreement between Coda Acquisition, Inc. and Jarl P. Johnson filed as Exhibit 99.8 to the October 1995 8-K, and incorporated by reference herein. 10.16/(2)/ Executive Employment Agreement between Coda Acquisition, Inc. and Douglas H. Miller filed as Exhibit 99.9 to the October 1995 8-K, and incorporated by reference herein. 10.17/(2)/ Executive Employment Agreement between Coda Acquisition, Inc. and J.W. Spencer, III filed as Exhibit 99.10 to the October 1995 8-K, and incorporated by reference herein. 10.18/(2)/ Amendment No. 1 to Subscription Agreement dated as of January 10, 1996 filed as Exhibit 99.2 to Coda's Current Report on Form S-K dated January 10, 1996, and incorporated by reference herein. 10.19/(2)/ Amendment No. 1 to Stockholders Agreement dated as of January 10, 1996 filed as Exhibit 99.3 to Coda's Current Report on Form 8-K dated January 10, 1996, and incorporated by reference herein. 10.20 Credit Agreement, dated February 14, 1996, among the Company, NationsBank, individually and as agent, and additional lenders named therein filed as Exhibit 4.4 above. 10.21 Promissory Note dated February 14, 1996, in the original principal amount of $87,500,000.00, executed by Coda, payable to NationsBank, filed as Exhibit 4.5 above. 10.22 Promissory Note dated February 14, 1996, in the original principal amount of $37,500,000.00, executed by Coda, payable to Bank One, Texas, N.A. filed as Exhibit 4.6 above. 22 10.23 Promissory Note dated February 14, 1996, in the original principal amount of $75,000,000.00, executed by Coda, payable to Texas Commerce Bank National Association filed as Exhibit 4.7 above. 10.24 Promissory Note dated February 14, 1996, in the original principal amount of $50,000,000.00, executed by Coda, payable to the First National Bank of Boston filed as Exhibit 4.8 above. 10.25/(2)/ Form of Nonstatutory Stock Option Agreement attached and filed as Exhibit A to Exhibit 99.3 to the October 1995 8-K, and incorporated by reference herein. 10.26/(2)/ Form of Limited Recourse Promissory Note attached and filed as Exhibit B to Exhibit 99.3 to the October 1995 8-K, and incorporated by reference herein. 10.27/(2)/ Form of Security Agreement attached and filed as Exhibit C to Exhibit 99.3 to the October 1995 8-K, and incorporated by reference herein. 10.28/(2)/ List of Management Investors who are parties to Nonstatutory Stock Option Agreement (Exhibit 10.25), Limited Recourse Promissory Note (Exhibit 10.26) or Security Agreement (Exhibit 10.27) filed as Exhibit 10.27 to the 1996 Form S-4, and incorporated by reference herein. 10.29 First Amendment to Credit Agreement, dated August 1, 1996, among the Company, NationsBank and additional lenders named therein filed as Exhibit 4.11 above. 10.30/(2)/ Limited Recourse Promissory Note dated July 31, 1996, in the original principal amount of $1,187,500.00 executed by Douglas H. Miller, payable to the Company, filed as Exhibit 10.30 to the September 1996 10-Q, and incorporated by reference herein. 10.31/(2)/ Amendment to Nonstatutory Stock Option Agreement dated July 31, 1996 between the Company and Douglas H. Miller filed as Exhibit 10.31 to the September 1996 10-Q, and incorporated by reference herein amending the Nonstatutory Stock Option Agreement filed as Exhibit 10.25 above. 27/(1)/ Financial data schedule - ---------------------------------------------------------- /(1)/ Filed herewith. /(2)/ Identifies management contract or compensation plan. 23 (B) Reports on Form 8-K - None - ------------------------------------------------------------------------------- SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. CODA ENERGY, INC. (Registrant) By: \s\ Grant W. Henderson --------------------------------------- Grant W. Henderson President and Chief Financial Officer Date: August 11, 1997 24 EXHIBIT INDEX Sequential Exhibit No. Description of Exhibit Page No. - ----------- ---------------------- ---------- 27.* Financial Data Schedule - ---------------- * Filed herewith 25 EX-27 2 FINANCIAL DATA SCHEDULE
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE INTERIM FINANCIAL STATEMENTS OF CODA ENERGY, INC. FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1997, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1,000 3-MOS DEC-31-1997 JUN-30-1997 6,296 0 11,638 0 0 18,811 305,859 35,959 297,443 15,223 178,100 0 20,000 9 46,383 297,443 59,262 59,876 35,968 35,968 0 0 8,077 1,961 903 1,058 0 0 0 1,058 0 0
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