-----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, PKmbBSPj2pQVhqkntcAKEPEcQpdXNkAahHrnIkX0C4mbh7ahTMzUoLNcPHjXOcHx XQXrjB59vwL73pMCc27jOQ== 0000788965-02-000005.txt : 20020515 0000788965-02-000005.hdr.sgml : 20020515 20020515162513 ACCESSION NUMBER: 0000788965-02-000005 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20020331 FILED AS OF DATE: 20020515 FILER: COMPANY DATA: COMPANY CONFORMED NAME: HALLADOR PETROLEUM CO CENTRAL INDEX KEY: 0000788965 STANDARD INDUSTRIAL CLASSIFICATION: CRUDE PETROLEUM & NATURAL GAS [1311] IRS NUMBER: 841014610 STATE OF INCORPORATION: CO FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 000-14731 FILM NUMBER: 02652839 BUSINESS ADDRESS: STREET 1: 1660 LINCOLN ST STE 2700 CITY: DENVER STATE: CO ZIP: 80264 BUSINESS PHONE: 3038395505 MAIL ADDRESS: STREET 1: 1660 LINCOLN STREET STREET 2: SUITE 2700 CITY: DENVER STATE: CO ZIP: 80264 FORMER COMPANY: FORMER CONFORMED NAME: KIMBARK INC DATE OF NAME CHANGE: 19860624 FORMER COMPANY: FORMER CONFORMED NAME: KIMBARK OIL & GAS CO /CO/ DATE OF NAME CHANGE: 19900102 10QSB 1 smarch2002q.txt MARCH 31, 2002 FORM 10-QSB UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM 10-QSB [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2002 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 0-14731 HALLADOR PETROLEUM COMPANY (Exact name of registrant as specified in its charter) Colorado 84-1014610 (State of incorporation) (I.R.S. Employer Identification No.) 1660 Lincoln Street, Suite 2700, Denver, Colorado 80264-2701 (Address of principal executive offices) 303-839-5504 FAX: 303-832-3013 (Issuer's telephone numbers) Check whether the issuer (1) filed all reports required by Section 13 or 15(d) of the Securities Exchange Act during the past 12 months, and (2) has been subject to such filing requirements for the past 90 days: Yes [x] No [ ] Shares outstanding as of May 14, 2002: 7,093,150 PART I. FINANCIAL INFORMATION Consolidated Balance Sheet (in thousands)
March 31, December 31, 2002 2001* ------- ------- ASSETS Current assets: Cash and cash equivalents $ 1,857 $ 2,078 Accounts receivable- Oil and gas sales 861 706 Well operations 167 174 ------ ------ Total current assets 2,885 2,958 ------ ------ Oil and gas properties at cost (successful efforts): Unproved properties 251 204 Proved properties 24,756 24,687 Less - accumulated depreciation, depletion, amortization and impairment (17,109) (16,497) ------ ------ 7,898 8,394 ------ ------ Oil and gas operator bonds 329 366 Investment in Catalytic Solutions 175 175 Other assets 40 44 ------ ------ $11,327 $11,937 ====== ====== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable and accrued liabilities $ 418 $ 833 Oil and gas sales payable 333 180 ------ ------ Total current liabilities 751 1,013 ------ ------ Key employee bonus plan 341 335 ------ ------ Future site restoration-South Cuyama Field 420 344 ------ ------ Minority interest 5,387 5,516 ------ ------ Stockholders' equity: Preferred stock, $.10 par value; 10,000,000 shares authorized; none issued Common stock, $.01 par value; 100,000,000 shares authorized; 7,093,150 shares issued 71 71 Additional paid-in capital 18,061 18,061 Accumulated deficit (13,704) (13,403) ------ ------ 4,428 4,729 ------ ------ $11,327 $11,937 ====== ====== - ------------------------------ *Derived from the Form 10-KSB.
See accompanying notes. Consolidated Statement of Operations (in thousands, except per share amounts)
Three months ended March 31, 2002 2001 ------ ------ Revenue: Oil $1,275 $1,287 Gas 257 485 NGLs 47 128 Interest and other 8 43 ----- ----- 1,587 1,943 ----- ----- Costs and expenses: Lease operating 1,075 1,120 Delay rentals 19 18 Depreciation, depletion and amortization 692 214 General and administrative 225 247 Purchase of employee stock options 300 Interest 6 14 ----- ----- 2,017 1,913 ----- ----- (Loss) income before minority interest (430) 30 Minority interest 129 (9) ----- ----- Net (loss) income $ (301) $ 21 ===== ===== Basic and diluted (loss) income per share $ (.04) $ * ===== ===== Weighted average shares outstanding-basic 7,093 7,093 ===== ===== Weighted average shares outstanding-diluted 7,093 7,438 ===== ===== - ----------------------------------------- *Not meaningful, less than $.01 per share.
See accompanying notes. Consolidated Statement of Cash Flows (in thousands)
Three months ended March 31, 2002 2001 ------ ------ Net cash provided by operating activities $ 121 $ 545 ----- ----- Cash flows from investing activities: Properties (379) (373) Other assets 37 ----- ----- Net cash used in investing activities (342) (373) ----- ----- Net (decrease) increase in cash and cash equivalents (221) 172 Cash and cash equivalents, beginning of year 2,078 2,489 ----- ----- Cash and cash equivalents, end of period $1,857 $2,661 ===== =====
1. The interim financial data is unaudited; however, in our opinion, it includes all adjustments, consisting only of normal recurring adjustments necessary for a fair statement of the results for the interim periods. The financial statements included herein have been prepared pursuant to the SEC's rules and regulations; accordingly, certain information and footnote disclosures normally included in GAAP financial statements have been condensed or omitted. 2. Our organization and business, the accounting policies we follow and other information are contained in the notes to our financial statements filed as part of our 2001 Form 10-KSB. This quarterly report should be read in conjunction with that annual report. HALLADOR PETROLEUM COMPANY Management's Discussion and Analysis or Plan of Operation RESULTS OF OPERATIONS YEAR-TO-DATE COMPARISON - ----------------------- The table below (in thousands) provides sales data and average prices for the period.
2002 2001 Sales Average Sales Average Volume Price Revenue Volume Price Revenue ------- ------- ------ ------ ----- ------- Oil - barrels South Cuyama field 53 $18.61 $986 53 $24.13 $1,279 Cox #41-5 (1) 14 18.36 257 South Texas-Bonus 1.3 20.00 26 Other * * 6 * * 8 Gas - mcf South Cuyama field 4 2.50 10 14 7.00 98 Cox #41-5 (1) 23 2.40 55 South Texas - Bonus 56 2.47 138 San Juan-New Mexico 13 1.47 19 16 7.31 117 Merlin Prospect(2) 6 1.84 11 18 11.67 210 Other 11 2.19 24 9 6.67 60 NGLs - barrels South Cuyama field 3.3 11.22 37 3.7 27.30 101 San Juan-New Mexico 1.1 9.10 10 1.2 21.67 26 Other * * 1 - ------------------------ * Not meaningful
(1) This well is part of the South Cuyama field, due to its significance we present it separately. (2) This field located in northern California is near the end of its economic life. Current prices for (i) the South Cuyama field are about $26.03 for oil and $3.44 for gas (ii) South Texas-Bonus are about $28.00 for oil and $3.70 for gas and (iii) San Juan gas is about $3.00. The table below (in thousands) shows lease operating expenses (LOE) for our primary fields.
2002 2001 ---- ---- South Cuyama field: LOE excluding electricity $ 688 $ 832 Electricity 319 234 ----- ----- 1,007 1,066 South Texas - Bonus 14 San Juan - New Mexico 16 29 Other 38 25 ----- ----- Total $1,075 $1,120 ===== =====
Gas and NGL revenue is down compared to last year due to lower prices. DD&A increased due to the downward revision in our oil reserves during the fourth quarter of 2001. LIQUIDITY AND CAPITAL RESOURCES - ------------------------------- Cash and cash flow from operations are expected to enable us to meet our obligations as they become due during the next several years. Bank Debt ---------- The SC Field, our principal asset, is pledged to U. S. Bank National Association under a $2,200,000 revolving line of credit which was renewed on March 31, 2002. Presently, we owe $31,000 under this line. THE FOLLOWING DISCUSSION UPDATES THE MD&A CONTAINED IN ITEM 6 OF THE 2001 FORM 10-KSB AND THE TWO DISCUSSIONS SHOULD BE READ TOGETHER. PROSPECT DEVELOPMENT AND EXPLORATION ACTIVITY - --------------------------------------------- South Cuyama Field ------------------ The production from the Cox #41-5 well is declining. During March 2002 the well was producing 500 mcf per day and 275 barrels per day; currently the gas production is 250 mcf per day and the oil production is 120 barrels per day. We are monitoring this decline and if necessary will reduce the reserves assigned to this well in the second quarter. There are no other significant changes or developments to report from what we disclosed in the 2001 Form 10-KSB. PART II. OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K (a) Exhibits 10.1 Second Amendment of Credit Agreement by and among Santa Barbara Partners, Hallador Petroleum, LLP and U. S. Bank Revolving Credit Agreement. (b) No reports on Form 8-K were filed during the quarter. SIGNATURE In accordance with the requirements of the Exchange Act, the registrant has caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. HALLADOR PETROLEUM COMPANY Dated: May 14, 2002 By: /s/VICTOR P. STABIO Chief Executive Officer and Chief Financial Officer Signing on behalf of registrant and as principal financial officer. EX-10 3 exhib10_1.txt 2ND AMENDMENT TO CREDIT AGREEMENT USBANK EXHIBIT 10.1 SECOND AMENDMENT OF CREDIT AGREEMENT THIS SECOND AMENDMENT OF CREDIT AGREEMENT (this "Amendment"), dated as of March 31, 2002, is by and among SANTA BARBARA PARTNERS, an Oklahoma general partnership ("SBP"), and HALLADOR PETROLEUM, LLP, a Colorado limited partnership ("Hallador"), and U.S. BANK NATIONAL ASSOCIATION, a national banking association (herein called "USB"). SBP and Hallador are herein collectively called "Borrowers". RECITALS A. Borrowers and USB are parties to a Credit Agreement dated as of March 10, 1999, as amended (as so amended, the "Credit Agreement"), setting forth the terms upon which USB would make advances to Borrowers and issue letters of credit at the request of Borrowers and by which such advances and letters of credit would be governed and repaid. Capitalized terms used herein but not defined herein shall have the same meanings as set forth in the Credit Agreement. B. Borrowers and USB desire that this Amendment be executed and delivered in order to amend certain terms and provisions of the Credit Agreement. AMENDMENT NOW, THEREFORE, in consideration of $10.00 and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows: 1. Credit Agreement. The Credit Agreement shall be, and hereby is, amended as follows, effective as of the date hereof: (a) The definition of "Borrowing Base (Oil and Gas)" in Section 1.1 on page 2 of the Credit Agreement shall be deleted and the following shall be substituted therefore: "Borrowing Base (Oil and Gas)" means, at any time prior to the Maturity Date, the aggregate loan value of all Borrowing Base Properties, as determined by USB in its sole and absolute discretion, using such assumptions as to pricing, discount factors, discount rates, expenses and other factors as USB customarily uses as to borrowing-base oil and gas loans at the time such termination is made; provided that the Borrowing Base (Oil and Gas) for the time period from April 1, 2002 through the date that the October 31, 2002 redetermination of the Borrowing Base (Oil and Gas) becomes effective shall be $2,200,000, unless Borrowers and USB hereafter mutually agree upon a different amount or unless the Borrowing Base (Oil and Gas) is redetermined pursuant to Section 2.10 below prior to such date. (b) The definition of "Borrowing Base Period" in Section 1.1 on page 2 of the Credit Agreement shall be deleted and the following shall be substituted therefore: "Borrowing Base Period" means each six-month time period beginning May 1 or November 1 of each year until the Maturity Date. (c) The definition of "Commitment Amount (Oil and Gas)" in the Section 1.1 on page 3 of the Credit Agreement shall be deleted and the following shall be substituted therefore: "Commitment Amount (Oil and Gas)" means, at any time, the least of: (a) $2,200,000, (b) the Borrowing Base (Oil and Gas) at the time, or (c) such lesser amount as may be elected by Borrowers in accordance with the provisions of Section 2.10 below. (d) The following new definition shall be inserted in alphabetical order in Section 1.1 on page 5 of the Credit Agreement: "LIBOR Spread" means, with respect to any LIBOR Tranche, the following: (a) if the Loan Usage is less than 50 percent as of the close of business of the first day of the LIBOR Interest Period for such LIBOR Tranche, 1.75 percentage points per annum; (b) if the Loan Usage is greater than or equal to 50 percent as of the close of business on the first day of the LIBOR Interest Period for such LIBOR Tranche, 2.25 percentage points per annum. (e) The following new definition shall be interested in alphabetical order in Section 1.1 on page 6 of the Credit Agreement: "Loan Usage" means, as of the close of business on any Business Day, the ratio of: (a) (1) the aggregate amount of all Advances outstanding hereunder, including any Advances made on that Business Day, plus (2) the face amounts if all Letters of Credit outstanding hereunder, including any Letters of Credit issued on that Business Day, (b) the Commitment Amount (Oil and Gas) in effect at that time. (f) The definition of "Maturity Date" in section 1.1 on page 6 of the Credit Agreement shall be deleted and the following shall be substituted therefore: "Maturity Date" means April 30, 2004; provided that, upon the request of Borrowers, YSB may, in its sole discretion, extend such time period at any time and from time to time to a date not later than March 31, 2006 by giving written notice of such extension to Borrowers, but nothing contained in this Agreement, the Notes or any other Loan Document shall be deemed to commit or require USB to grant any such extension. (g) Section 2.4 (c) (1) on page 11 of the Credit Agreement shall be deleted and the following shall be substituted therefore: (C) (1) Except as otherwise provided in (3) below, interest on each LIBOR Tranche shall accrue at a fixed annual rate equal to LIBOR (Adjusted) with respect to such LIBOR Tranche plus the LIBOR Spread with respect to such LIBOR Tranche. 2. Loan Documents. All references in any document to the Credit Agreement shall be deemed to refer to the Credit Agreement, as amended pursuant to this Amendment. 3. Conditions Precedent. The obligations of the parties under the Amendment are subject, at the option of USB, to the prior satisfaction of the condition that Borrowers shall have delivered to USB the following (all documents to be satisfactory in form and substance to USB and, if appropriate, duly executed and/or acknowledged on behalf of the parties other than USB): (a) This Amendment. (b) Any and all other loan documents required by USB, including without limitation such amendments and supplements to the Security Documents as may be required by USB and any and all resolutions, certifications and other evidence of authority as may be required by USB. (c) An extension fee in the amount of $5,500. 4. Certification by Borrowers. Borrowers hereby certify to USB that as of the date of this Amendment: (a) all of Borrowers' representations and warranties contained in the Credit Agreement are true, accurate and complete in all material respects, (b) Borrowers have performed and complied with all agreements and conditions required to be performed or complied with by Borrowers under the Credit Agreement and/or any Loan Document on or prior to this date, and (c) no Default or Event of Default has occurred under the Credit Agreement. 5. Condition of the Credit Agreement. Except as specified in this Amendment, the provisions of the Credit Agreement shall remain in full force and effect, and if there is a conflict between terms of this Amendment and those of the Credit Agreement, the terms of this Amendment shall control. 6. Expenses. Borrowers shall pay all reasonable expenses incurred in connection with the transactions contemplated by this Amendment, including without limitations all reasonable fees and expenses of USB's attorney and all costs incurred in filing and recording any applicable Security Documents. 7. Miscellaneous. This Amendment shall be governed by and construed under the laws of the State of Colorado and shall be binding upon and inure to the benefit of the parties hereto and their successors and assigns. This Amendment may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one instrument. EXECUTED as of the date first above written. SANTA BARBARA PARTNERS By: Hallador Petroleum Company, General Partner By: /S/VICTOR P. STABIO Victor P. Stabio, President HALLADOR PETROLEUM, LLP By: Hallador Petroleum Company, General Partner By: /S/ VICTOR P STABIO Victor P. Stabio, President U.S.BANK NATIONAL ASSOCIATION By: /S/MONTE E DECKERD Monte E. Deckerd, Vice President -1- -----END PRIVACY-ENHANCED MESSAGE-----