Acquisitions

Gulf of Mexico Acquisition:

On July 3, 2013, the Company acquired certain shallow water Gulf of Mexico shelf oil and gas properties (the “Acquired Assets”), for an aggregate cash purchase price of $188.8 million, reflecting an effective date of January 1, 2013 (collectively, the "Gulf of Mexico Acquisition"). The Acquired Assets included 16 wells located on seven platforms.

The aggregate cash purchase price of the Gulf of Mexico Acquisition was financed with the net proceeds from the sale of $200 million in principal amount of the Company's 10% Senior Notes due 2017 (the "New Notes"). In connection with the transaction, the Company recorded $5.0 million of deferred financing costs related to the New Notes and incurred $4.0 million of acquisition-related costs, including $2.6 million related to a bridge commitment fee, which were recognized as general and administrative expenses.

The Gulf of Mexico Acquisition was accounted for under the purchase method of accounting, which involves determining the fair value of the assets acquired and liabilities assumed. The fair value of proved and unevaluated oil and gas properties was estimated using the income approach based on estimated reserve quantities, costs to produce and develop reserves, and forward prices for oil and gas, which represent Level 2 and Level 3 inputs. Asset retirement obligations were determined in accordance with applicable accounting standards.

The following table summarizes the acquisition date fair values of the net assets acquired (in thousands):



Oil and gas properties	$	192,067
Unevaluated oil and gas properties	12,033
Asset retirement obligations	(15,319		)
Net assets acquired	$	188,781

The following unaudited summary pro forma financial information for the three and six month periods ended June 30, 2013 has been prepared to give effect to the Gulf of Mexico Acquisition as if it had occurred on January 1, 2012. The pro forma financial information is not necessarily indicative of the results that might have occurred had the transaction taken place on January 1, 2012 and is not intended to be a projection of future results. Future results may vary significantly from the results reflected in the following pro forma financial information because of normal production declines, changes in commodity prices, future acquisitions and divestitures, future development and exploration activities and other factors. Amounts in thousands, except per share amounts.



	Three Months Ended		Six Months Ended
	June 30, 2013		June 30, 2013

Revenues	$	55,155	$	106,907
Income from operations	6,346		11,169
Income available to common stockholders	5,899		9,093

Basic earnings per share	0.09		0.14
Diluted earnings per share	0.09		0.14

Fleetwood Joint Venture:

In June 2014, we entered into a joint venture in Louisiana for an aggregate purchase price of $24 million. The assets acquired under the joint venture include an average 37% working interest in an approximately 30,000 acre leasehold position in Louisiana and exclusive rights, along with our joint venture partner, to a 200 square mile proprietary 3D survey which has generated several conventional and shallow non-conventional oil focused prospects.

The purchase price was comprised of $10 million in cash ($3 million paid in July 2014 and $7 million due in January 2015) and $14 million in cash funding for future drilling, completion and lease acquisition costs. If the $14 million in drilling, completion and lease acquisition costs is not fully funded by December 31, 2015, any remaining balance becomes payable at the election of our joint venture partner.

Amounts payable with regard to the joint venture are reflected as accrued acquisition costs in the Consolidated Balance Sheet. The amounts payable related to the $14 million discussed above are classified as current and long term based on the current exploration and development plans under the joint venture. All of the costs associated with the joint venture are considered unevaluated at June 30, 2014.