Nevada
|
1-16071
|
74-2584033
|
(State or other jurisdiction of incorporation)
|
(Commission File Number)
|
(I.R.S. Employer Identification Number)
|
o
|
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
|
o
|
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
|
o
|
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
|
o
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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5900435v.1
|
(b)
|
Pro Forma Financial Information
|
(d)
|
Exhibits
|
2.1
|
Agreement to Dissolve Blue Eagle Energy, LLC dated September 4, 2012 by and among Blue Eagle, Abraxas and Rock Oil
|
99.1
|
Unaudited Pro Forma Condensed Consolidated Financial Information giving effect to the dissolution of Blue Eagle
|
A.
|
all rights, title and interest in the Yoakum properties, which are described on Exhibit A to this Agreement, shall be conveyed to Abraxas;
|
B.
|
an undivided 25% working interest in the Sugarkane and Wycross properties, which are described on Exhibit B to this Agreement, shall be conveyed to Abraxas;
|
|
C.
|
all rights, title and interest in and to the Jourdanton properties limited in depth from the surface to the base of the Buda formation (defined as the stratagraphic equivalent of 8,125 feet as noted on the Dual Induction-SFL-Sonic log of the Leede Oil and Gas, Inc. #1 W.E. Stapp (API Number 42-013-31128)), including the Grass Farms Wells, which are described on Exhibit C to this Agreement, shall be conveyed to Abraxas;
|
D.
|
an undivided 75% working interest in the Sugarkane and Wycross properties, which are described on Exhibit B to this Agreement, shall be conveyed to Rock Oil; and
|
E.
|
all rights, title and interest in and to the Jourdanton properties for all depths below the base of the Buda formation (as defined above), which are described in Exhibit C to this Agreement, shall be conveyed to Rock Oil;
|
A.
|
Representations and Warranties by Abraxas. Abraxas makes the following representations and warranties to Rock Oil and BEE:
|
(i)
|
Abraxas has all requisite power and authority to enter into this Agreement, to perform its obligations under this Agreement, and to operate the interests and assets being conveyed to it pursuant to this Agreement. The execution, delivery and performance of this Agreement and the transactions contemplated hereby have been duly and validly authorized by all requisite action on the part of Abraxas.
|
(ii)
|
The consummation of the transactions contemplated hereby will not violate, nor be in conflict with, any provision of Abraxas’ Articles of Incorporation or other governing documents, or any agreement or instrument to which Abraxas is a party or is bound, or any judgment, decree, order, statute, rule or regulation applicable to Abraxas, except for any consents and approvals of governmental authorities customarily obtained subsequent to transfer.
|
B.
|
Representations and Warranties by Rock Oil. Rock Oil makes the following representations and warranties to Abraxas and BEE:
|
(i)
|
Rock Oil has all requisite power and authority to enter into this Agreement, to perform its obligations under this Agreement, and to operate the interests and assets being conveyed to it pursuant to this Agreement. The execution, delivery and performance of this Agreement and the transactions contemplated hereby have been duly and validly authorized by all requisite action on the part of Rock Oil.
|
(ii)
|
The consummation of the transactions contemplated hereby will not violate, nor be in conflict with, any provision of Rock Oil’s Amended and Restated Operating Agreement or other governing documents, or any agreement or instrument to which Rock Oil is a party or is bound, or any judgment, decree, order, statute, rule or regulation applicable to Rock Oil, except for any consents and approvals of governmental authorities customarily obtained subsequent to transfer.
|
A.
|
the parties shall execute and deliver to each other this Agreement;
|
B.
|
Rock Oil shall make a cash capital contribution to BEE in the amount of $7 million;
|
C.
|
BEE shall make a cash distribution to Abraxas, by wire transfer of immediately available funds to an account designated in writing by Abraxas, in the amount set forth on Exhibit D;
|
D.
|
BEE shall make a cash distribution to Rock Oil in the amount set forth on Exhibit D;
|
E.
|
BEE shall execute and deliver to Rock Oil such instrument as is necessary to convey to Rock Oil title to BEE’s Toyota Tundra truck;
|
F.
|
BEE and Abraxas shall execute and deliver to each other one or more forms of Assignment, Bill of Sale and Conveyance, to convey the interests to Abraxas, as described in Section 1 of this Agreement;
|
G.
|
BEE and Rock Oil shall execute and deliver to each other one or more forms of Assignment, Bill of Sale and Conveyance, to convey the interests to Rock Oil, as described in Section 1 of this Agreement;
|
H.
|
BEE, Abraxas and Rock Oil shall execute and deliver to each other an Assignment and Assumption Agreement, as described in Section 2 of this Agreement;
|
I.
|
Abraxas and Rock Oil shall execute and deliver to each other an Operating Agreement with respect to their joint interests in the Sugarkane properties, as described in Section 3 of this Agreement;
|
J.
|
Abraxas and Rock Oil shall execute and deliver to each other an Operating Agreement with respect to their joint interests in the Wycross properties, as described in Section 3 of this Agreement;
|
K.
|
Abraxas and Rock Oil shall execute and deliver to each other an Area of Mutual Interest Agreement with respect to the Wycross and Sugarkane properties, as described in Section 3 of this Agreement; and
|
L.
|
Abraxas and Rock Oil shall execute and deliver to each other a Transfer of Operations Agreement in form and substance satisfactory to Abraxas and Rock Oil.
|
A.
|
Transaction Expenses. BEE shall be responsible for the payment of all fees and expenses incurred by Abraxas and Rock Oil in connection with the negotiation and preparation of this Agreement and all other all agreements and documents ancillary hereto and the transactions contemplated hereby and thereby (collectively the “Transaction Expenses”). The Transaction Expenses shall include all fees, costs, and expenses of legal counsel, accountants and all other third party consultants and advisors engaged by each such party to assist with the negotiation or preparation of this Agreement and all other agreements and documents ancillary hereto and the transactions contemplated hereby and thereby. Promptly after Closing, BEE shall pay all Transaction Expenses or, if necessary, reimburse Abraxas and Rock Oil for any Transaction Expenses paid by them prior to the date hereof.
|
B.
|
Amendment; Waiver.
|
(i)
|
Any amendment to this Agreement shall require the written approval of each of Abraxas and Rock Oil.
|
(ii)
|
Failure on the part of a party to complain of any act or omission of any party or to declare any party in breach or default with respect to an obligation, irrespective of how long that failure continues, shall not be construed as a waiver of the breach or default until the applicable statute of limitations has run. No waiver of any obligation under this Agreement shall be effective unless in writing signed by or on behalf of the party to whom the obligation is owed.
|
C.
|
Entire Agreement. This Agreement, together with the other agreements and instruments referred to herein, constitute the entire agreement between Abraxas and Rock Oil with respect to the subject matter hereof and supersede all prior and contemporaneous agreements and understandings, whether written or oral, between them with respect to the subject matter hereof. All Exhibits hereto are expressly made a part of this Agreement.
|
D.
|
Parties in Interest. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns (it being understood and agreed that, except as expressly provided herein, nothing contained in this Agreement is intended to confer any rights, benefits or remedies of any kind or character on any other person, other than BEE, under or by reason of this Agreement).
|
E.
|
Governing Law. This Agreement shall be governed by and construed in accordance with the Laws of the State of Delaware (without regard to any conflicts of law principles that would require the application of the laws of any other jurisdiction).
|
F.
|
Severability. In the event that any provision contained herein shall be held to be invalid, illegal or unenforceable for any reason, the invalidity, illegality or unenforceability thereof shall not affect any other provision hereof, and this Agreement shall be construed as if such invalid, illegal or unenforceable provision had never been contained herein.
|
G.
|
Headings. The headings herein are for convenience of reference only, do not constitute a part of this Agreement and shall not be deemed to limit, extend or otherwise affect the meaning of any of the provisions hereof.
|
H.
|
Further Assurances. In connection with this Agreement and the transactions contemplated hereby, each party agrees to execute and deliver any additional documents and instruments and to perform any additional acts necessary or appropriate to effectuate the provisions of this Agreement and the transactions contemplated hereby.
|
I.
|
Counterparts; Electronic Signature Delivery. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument. In the event that any signature is delivered by electronic transmission of a facsimile thereof (including a “.pdf” format data file), such signature shall create a valid and binding obligation of the party executing with the same force and effect as if such facsimile were an original signature.
|
J.
|
Amendments to LLC Agreement. From and after the Effective Time, (i) Section 3.4 of the LLC Agreement shall be of no further force and effect; and (ii) Section 12.2 of the LLC Agreement shall not apply with respect to any information related to those assets which are being distributed to Abraxas and Rock Oil pursuant to this Agreement.
|
June 30,
|
Pro-Forma
|
June 30,
|
|||||||||
2012
|
Adjustments
|
2012
|
|||||||||
(Unaudited)
|
Pro- Forma
|
||||||||||
Assets
|
`
|
||||||||||
Current assets:
|
|||||||||||
Cash and cash equivalents
|
$
|
308
|
6,025
|
(a)
|
$
|
6,333
|
|||||
Accounts receivable, net:
|
11,405
|
(263
|
)
|
(b)
|
11,142
|
||||||
Derivative asset – current
|
2,535
|
—
|
2,535
|
||||||||
Other current assets
|
455
|
—
|
455
|
||||||||
Total current assets
|
14,703
|
5,762
|
20,465
|
||||||||
Property and equipment:
|
|||||||||||
Oil and gas properties, full cost method of accounting:
|
|||||||||||
Proved
|
521,919
|
20,540
|
(c)
|
542,459
|
|||||||
Unproved properties excluded from depletion
|
2,185
|
—
|
2,185
|
||||||||
Other property and equipment
|
37,290
|
—
|
37,290
|
||||||||
Total
|
561,394
|
20,540
|
581,934
|
||||||||
Less accumulated depreciation, depletion, and amortization
|
(358,232
|
)
|
—
|
(358,232
|
)
|
||||||
Total property and equipment – net
|
203,162
|
20,540
|
223,702
|
||||||||
|
|||||||||||
Investment in joint venture
|
28,249
|
(28,249
|
)
|
(d)
|
—
|
||||||
Deferred financing fees, net
|
3,797
|
—
|
3,797
|
||||||||
Derivative asset – long-term
|
2,640
|
—
|
2,640
|
||||||||
Other assets
|
744
|
—
|
744
|
||||||||
Total assets
|
$
|
253,295
|
(1,947
|
)
|
$
|
251,348
|
June 30,
|
Pro-Forma
|
June 30,
|
|||||||||
2012
|
Adjustments
|
2012
|
|||||||||
(Unaudited)
|
Pro- Forma
|
||||||||||
Liabilities and Stockholders’ Equity
|
|||||||||||
Current liabilities:
|
|||||||||||
Accounts payable
|
$
|
18,491
|
$ |
—
|
$
|
18,491
|
|||||
Oil and gas production payable
|
7,208
|
(1,958
|
)
|
(e)
|
5,250
|
||||||
Accrued interest
|
151
|
—
|
151
|
||||||||
Other accrued expenses
|
1,319
|
—
|
1,319
|
||||||||
Derivative liability – current
|
4,058
|
—
|
4,058
|
||||||||
Current maturities of long-term debt
|
186
|
—
|
186
|
||||||||
Total current liabilities
|
31,413
|
(1,958
|
)
|
29,455
|
|||||||
Long-term debt, excluding current maturities
|
136,664
|
—
|
136,664
|
||||||||
Derivative liability – long-term
|
1,128
|
—
|
1,128
|
||||||||
Future site restoration
|
8,716
|
11
|
(f)
|
8,727
|
|||||||
Total liabilities
|
177,921
|
(1,947
|
)
|
175,974
|
|||||||
Stockholders’ Equity
|
—
|
||||||||||
Preferred stock, par value $0.01 per share, authorized 1,000,000 shares; -0- issued and outstanding
|
|||||||||||
Common stock, par value $0.01 per share, authorized 200,000,000 shares; 92,335,057 and 92,261,057 issued and outstanding
|
923
|
—
|
923
|
||||||||
Additional paid-in capital
|
249,738
|
—
|
249,738
|
||||||||
Accumulated deficit
|
(174,748
|
)
|
—
|
(174,748
|
)
|
||||||
Accumulated other comprehensive loss
|
(539
|
)
|
—
|
(539
|
)
|
||||||
Total stockholders’ equity
|
75,374
|
—
|
75,374
|
||||||||
Total liabilities and stockholders’ equity
|
$
|
253,295
|
$ |
(1,947
|
)
|
$
|
251,348
|
June 30,
2012
|
Pro Forma Adjustments
|
Pro-Forma
June 30,2012
|
|||||||||
Revenue:
|
|||||||||||
Oil and gas production revenues
|
$
|
32,313
|
$
|
3,212
|
(a)
|
$
|
35,525
|
||||
Other
|
18
|
—
|
18
|
||||||||
32,331
|
3,212
|
35,543
|
|||||||||
Operating costs and expenses:
|
|||||||||||
Lease operating expenses
|
11,316
|
357
|
(b)
|
11,673
|
|||||||
Production taxes
|
2,985
|
135
|
(b)
|
3,120
|
|||||||
Depreciation, depletion, and amortization
|
10,218
|
446
|
(c)
|
10,664
|
|||||||
Impairment
|
1,306
|
—
|
1,306
|
||||||||
General and administrative (including stock-based compensation of $1,199)
|
4,305
|
—
|
4,305
|
||||||||
30,130
|
938
|
31,068
|
|||||||||
Operating income (loss)
|
2,201
|
2,274
|
4,475
|
||||||||
Other (income) expense:
|
|||||||||||
Interest income
|
(2
|
)
|
—
|
(2
|
)
|
||||||
Interest expense
|
2,465
|
—
|
2,465
|
||||||||
Amortization of deferred financing fee
|
296
|
—
|
296
|
||||||||
(Gain) loss on derivative contracts - realized
|
(866
|
)
|
—
|
(866
|
)
|
||||||
(Gain) loss on derivative contracts – unrealized
|
(9,420
|
)
|
—
|
(9,420
|
)
|
||||||
Equity in income of joint venture
|
(2,034
|
)
|
2,034
|
(e)
|
—
|
||||||
Other
|
42
|
—
|
42
|
||||||||
(9,519
|
)
|
2,034
|
(7,485
|
)
|
|||||||
Net income (loss)
|
$
|
11,720
|
$
|
240
|
$
|
11,960
|
|||||
Net income (loss) per common share – basic
|
$
|
0.13
|
$
|
—
|
$
|
0.13
|
|||||
Net income (loss) per common share – diluted
|
$
|
0.13
|
$
|
—
|
$
|
0.13
|
December 31,
2011
|
Pro Forma Adjustments
|
Pro-Forma
December 31, 2011
|
|||||||||
Revenue:
|
|||||||||||
Oil and gas production revenues
|
$
|
64,615
|
$
|
3,223
|
(a)
|
$
|
67,838
|
||||
Other
|
7
|
—
|
7
|
||||||||
64,622
|
3,223
|
67,845
|
|||||||||
Operating costs and expenses:
|
|||||||||||
Lease operating expenses
|
21,581
|
125
|
(b)
|
21,706
|
|||||||
Production taxes
|
5,766
|
73
|
(b)
|
5,839
|
|||||||
Depreciation, depletion, and amortization
|
16,194
|
740
|
(c)
|
16,934
|
|||||||
General and administrative (including stock-based compensation of $1,987)
|
9,433
|
—
|
9,433
|
||||||||
52,974
|
938
|
53,912
|
|||||||||
Operating income (loss)
|
11,648
|
2,285
|
13,933
|
||||||||
Other (income) expense:
|
|||||||||||
Interest income
|
(7
|
)
|
—
|
(7
|
)
|
||||||
Interest expense
|
4,898
|
1
|
(d)
|
4,899
|
|||||||
Amortization of deferred financing fee
|
1,762
|
—
|
1,762
|
||||||||
(Gain) loss on derivative contracts - realized
|
676
|
—
|
676
|
||||||||
(Gain) loss on derivative contracts – unrealized
|
(7,476
|
)
|
—
|
(7,476
|
)
|
||||||
Equity in income of joint venture
|
(2,187
|
)
|
2,187
|
(e)
|
—
|
||||||
Other
|
316
|
—
|
316
|
||||||||
(2,018
|
)
|
2,188
|
170
|
||||||||
Net income (loss) before income tax
|
$
|
13,666
|
$
|
97
|
$
|
13,763
|
|||||
Income tax (expense) benefit
|
77
|
—
|
77
|
||||||||
Net income (loss)
|
$
|
13,743
|
$
|
97
|
$
|
13,840
|
|||||
Net income (loss) per common share – basic
|
$
|
0.15
|
$
|
—
|
$
|
0.15
|
|||||
Net income (loss) per common share – diluted
|
$
|
0.15
|
$
|
—
|
$
|
0.15
|
(a)
|
Cash proceeds to Abraxas Petroleum.
|
(b)
|
Record assignment of Blue Eagle receivable to Abraxas Petroleum.
|
(c)
|
Transfer net balance of investment in joint venture to proved properties. Properties and assets acquired are recorded as a purchase of assets. No gain or loss is recognized in connection with this transaction.
|
(d)
|
Net balance in joint venture transferred to proved properties.
|
(e)
|
Record assignment of Blue Eagle revenue receivable to Abraxas Petroleum.
|
(f)
|
Record future site restoration liability for producing properties distributed from joint venture.
|
(a)
|
Revenue attributable to the oil and gas properties retained by Abraxas Petroleum.
|
(b)
|
Lease operating expense and taxes related to properties retained by Abraxas Petroleum.
|
(c)
|
Depletion on production from oil and gas properties retained by Abraxas Petroleum.
|
(d)
|
Record accretion of future site restoration liability.
|
(e)
|
Eliminate income from joint venture.
|