-----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, TEpgNno2azya6/4D9K02Rd1EdiJJy1P32OYaArKC6XvGBqvlBeP0HBBGhwp2I0/W UrgeHjdIJnErkZMcwiXEAg== 0000891020-98-000617.txt : 19980422 0000891020-98-000617.hdr.sgml : 19980422 ACCESSION NUMBER: 0000891020-98-000617 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19980417 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19980421 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: OPTIMA PETROLEUM CORP CENTRAL INDEX KEY: 0000872248 STANDARD INDUSTRIAL CLASSIFICATION: CRUDE PETROLEUM & NATURAL GAS [1311] IRS NUMBER: 980115468 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 000-19020 FILM NUMBER: 98597920 BUSINESS ADDRESS: STREET 1: 600 HOWE ST STREET 2: VANCOUVER BRITISH COLUMBIA CITY: CANADA V6C 2T5 STATE: A1 BUSINESS PHONE: 6046846886 MAIL ADDRESS: STREET 1: 600 HOWE ST STREET 2: VANCOUVER BRITISH COLUMBIA CITY: CANADA V6C 2T5 STATE: A1 8-K 1 EDGAR FORM 8-K FOR OPTIMA PETROLEUM CORPORATION 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION FORM 8-K PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES AND EXCHANGE ACT OF 1934 Date of the Report: April 17, 1998 Commission File No. 019020 OPTIMA PETROLEUM CORPORATION (Exact Name of Registrant as Specified in its Charter) CANADA 98-0115468 (State of Incorporation) (I.R.S. Employee Identification No.) #600 - 595 HOWE STREET VANCOUVER, BRITISH COLUMBIA, CANADA V6C 2T5 (Address of Principal Executive Offices) (Postal Code) (604) 684-6886 (Registrant's Telephone Number Including Area Code) 2 ITEM 2 - ACQUISITION OF ASSETS Whereas the Company reported on Form 8-K filed February 28, 1998 that it had entered into a definitive agreement with American Explorer, L.L.C. of Lafayette, Louisiana, in accordance with regulatory disclosure requirements, it has attached pro forma financial statements for the 1996 and 1997 fiscal years reflecting the combination of the Company with American Explorer, L.L.C. The merger is subject to approval by Optima shareholders, U.S. and Canadian regulatory authorities and customary conditions of closing. ITEM 7 - EXHIBITS
NO. DESCRIPTION 7.2 Pro Forma Financial Statements of Optima Petroleum Corporation as at December 31, 1997 and for the years ended December 31, 1997 and 1996. (Unaudited - see Compilation Report)
SIGNATURES Pursuant to the requirements of the Securities and Exchange Act of 1934, Registrant has duly caused this report to be signed on behalf of the undersigned hereunto duly authorized. April 17, 1998 OPTIMA PETROLEUM CORPORATION /s/ RONALD P. BOURGEOIS - ---------------------------- Ronald P. Bourgeois, Chief Financial Officer 3 Pro Forma Financial Statements of OPTIMA PETROLEUM CORPORATION As at December 31, 1997 and For the Years Ended December 31, 1997 and 1996 (Unaudited - see Compilation Report) 4 COMPILATION REPORT The Board of Directors Optima Petroleum Corporation We have reviewed, as to compilation only, the accompanying pro forma consolidated balance sheet of Optima Petroleum Corporation as at December 31, 1997 and the pro forma combined statements of operations of Optima Petroleum Corporation and American Explorer LLC for the years ended December 31, 1997 and 1996. These pro forma financial statements have been prepared for inclusion in the information circular relating to the issuance of 7,335,001 common shares of Optima Petroleum Corporation on its merger with American Explorer LLC. In our opinion, the pro forma consolidated balance sheet and the pro forma combined statements of operations have been properly compiled to give effect to the proposed transactions and assumptions described in Note 2 thereto. /s/ KPMG - --------------------- Chartered Accountants Vancouver, Canada April 3, 1998 5 OPTIMA PETROLEUM CORPORATION Pro Forma Balance Sheet December 31, 1997
================================================================================================================================ Pro Forma OPC AMEX Adjustments Notes Consolidated - -------------------------------------------------------------------------------------------------------------------------------- ASSETS CURRENT Cash and cash equivalents $ 5,660,354 $ 246,610 $ 5,906,964 Cash in trust 715,250 -- 715,250 Accounts receivable 2,220,151 2,100,443 4,320,594 Note receivable - current portion 129,861 -- 129,861 - -------------------------------------------------------------------------------------------------------------------------------- 8,725,616 2,347,053 11,072,669 OTHER Cash held in trust 703,996 1,109,356 1,813,352 Advances to operators 547,200 -- 547,200 Note receivable - long term portion 265,077 -- 265,077 Petroleum and natural gas interests, full cost method 17,695,968 10,692,975 $ 6,504,228 2(a) 36,788,871 1,895,700 2(b) Deferred charges 205,486 -- 205,486 - -------------------------------------------------------------------------------------------------------------------------------- $ 28,143,343 $14,149,384 $ 50,692,655 ================================================================================================================================ LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT Accounts payable and accrued liabilities $ 868,796 $ 3,515,714 $ 4,384,510 Current portion of long-term debt -- 2,574,900 2,574,900 - -------------------------------------------------------------------------------------------------------------------------------- 868,796 6,090,614 6,959,410 REVENUE IN DISPUTE 1,023,998 -- 1,023,998 LONG-TERM DEBT 143,050 2,288,800 2,431,850 SITE RESTORATION AND ABANDONMENT 369,297 -- $ 1,895,700 2(b) 2,264,997 SHAREHOLDERS' EQUITY Share capital 30,891,689 -- 12,274,198 2(a) 43,165,887 Contributed surplus 608,222 -- 608,222 Deficit (5,761,709) 5,769,970 (5,769,970) 2(a) (5,761,709) - -------------------------------------------------------------------------------------------------------------------------------- 25,738,202 5,769,970 38,012,400 - -------------------------------------------------------------------------------------------------------------------------------- $ 28,143,343 $14,149,384 $ 50,692,655 ================================================================================================================================
See accompanying notes to pro forma financial statements. 6 OPTIMA PETROLEUM CORPORATION Pro Forma Statement of Operations December 31, 1997
==================================================================================================================================== Pro Forma OPC AMEX Adjustments Notes Combined - ------------------------------------------------------------------------------------------------------------------------------------ OPERATING INCOME Petroleum and natural gas sales $ 7,649,415 $ 9,403,334 $ 3,806,465 2(f) $20,859,214 Royalties and production taxes 2,581,196 361,396 3,806,465 2(f) 6,749,057 Operating costs 1,018,211 3,279,187 4,297,398 - ------------------------------------------------------------------------------------------------------------------------------------ 4,050,008 5,762,751 9,812,759 EXPENSES General and administrative 1,691,779 550,768 2,242,547 - ------------------------------------------------------------------------------------------------------------------------------------ EARNINGS BEFORE INTEREST, DEPLETION, DEPRECIATION, AMORTIZATION AND INCOME TAXES 2,358,229 5,211,983 7,570,212 Depletion and depreciation 4,269,745 3,898,106 1,303,345 2(c) 9,471,196 Provision for revenue dispute 1,023,998 -- 1,023,998 Gain on sale of Canadian petroleum and natural gas interests (518,025) -- (518,025) Interest and other revenue (250,916) (62,124) (313,040) Foreign exchange gain (259,315) (43,035) (302,350) Interest and bank charges 188,468 77,870 266,338 Amortization of deferred financing costs 68,494 -- 68,494 Write-down of petroleum and natural gas interests 2,520,000 -- 2,520,000 - ------------------------------------------------------------------------------------------------------------------------------------ INCOME (LOSS) BEFORE INCOME TAXES (4,684,220) 1,341,166 (4,646,399) Income taxes 151,000 -- 480,300 2(d) 151,000 (480,300) 2(e) - ------------------------------------------------------------------------------------------------------------------------------------ NET INCOME (LOSS) FOR THE YEAR $(4,835,220) $ 1,341,166 $(4,797,399) ==================================================================================================================================== NET INCOME (LOSS) PER COMMON SHARE (Note 3) $ (0.43) N/A $ (0.26) ====================================================================================================================================
See accompanying notes to pro forma financial statements. 7 OPTIMA PETROLEUM CORPORATION Pro Forma Statement of Operations December 31, 1996
=============================================================================================================================== Pro Forma OPC AMEX Adjustments Notes Combined - ------------------------------------------------------------------------------------------------------------------------------- OPERATING INCOME Petroleum and natural gas sales $ 12,862,701 $ 6,169,037 $ 2,795,460 2(f) $ 21,827,198 Royalties and production taxes 2,887,096 368,389 2,795,460 2(f) 6,050,945 Operating costs 1,649,650 1,940,903 3,590,553 - ------------------------------------------------------------------------------------------------------------------------------- 8,325,955 3,859,745 12,185,700 EXPENSES General and administrative 1,663,411 391,226 2,054,637 - ------------------------------------------------------------------------------------------------------------------------------- EARNINGS BEFORE INTEREST, DEPLETION, DEPRECIATION, AMORTIZATION AND INCOME TAXES 6,662,544 3,468,519 10,131,063 Depletion and depreciation 5,661,205 1,537,791 866,821 2(c) 8,065,817 Interest and other revenue (26,095) (87,957) (114,052) Foreign exchange gain (3,789) (9,308) (13,097) Interest and bank charges 685,942 231,162 917,104 Amortization of deferred financing costs 68,494 -- 68,494 - ------------------------------------------------------------------------------------------------------------------------------- INCOME (LOSS) BEFORE INCOME TAXES 276,787 1,796,831 1,206,797 Income taxes 48,214 -- 661,400 2(d) 48,214 (661,400) 2(e) - ------------------------------------------------------------------------------------------------------------------------------- NET INCOME (LOSS) FOR THE YEAR $ 228,573 $ 1,796,831 $ 1,158,583 =============================================================================================================================== NET INCOME (LOSS) PER COMMON SHARE (Note 3) $ 0.02 N/A $ 0.06 ===============================================================================================================================
See accompanying notes to pro forma financial statements. 8 OPTIMA PETROLEUM CORPORATION NOTES TO PRO FORMA FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 1997 AND 1996 (CANADIAN DOLLARS) (UNAUDITED) 1. BASIS OF PRESENTATION The accompanying unaudited pro forma financial statements of Optima Petroleum Corporation ("OPC") have been prepared by management in accordance with accounting principles generally accepted in Canada. The pro forma statements have been prepared from the audited consolidated financial statements of OPC for the years ended December 31, 1997 and 1996 and from audited financial statements of American Explorer, LLC ("AMEX") for the years ended December 31, 1997 and 1996, together with other publicly available information. In the opinion of management, these pro forma statements include all adjustments necessary for fair presentation. The pro forma statements do not include the financial position and results of operations of Goodson Exploration Company, NAB Financial, L.L.C. or Dexco Energy, Inc., all of which will be acquired under the proposed acquisition, as all assets and liabilities of these companies, except for their investments in AMEX, will be removed immediately prior to the acquisition. The audited financial statements of AMEX have been translated from U.S. dollars to Canadian dollars using the current rate method. Under this method, the balance sheet at December 31, 1997 is translated at a current exchange rate at this date of $1.4305 and the statements of operations are translated at the average exchange rate for the year presented (1997 - $1.3846; 1996 - $1.3635). The pro forma statements are not necessarily indicative of either the results of operations that would have occurred for the year ended December 31, 1997, or of the results of operations expected in 1998 and future years. In preparing these pro forma statements, no adjustments have been made to reflect the operating synergies and general and administrative cost savings expected to result from consolidating the operations of OPC and AMEX. These pro forma statements should be read in conjunction with the audited consolidated financial statements and notes thereto of OPC and the audited financial statements and notes thereto of AMEX for the years ended December 31, 1997 and 1996. 2. PRO FORMA ASSUMPTIONS AND ADJUSTMENTS The pro forma consolidated balance sheet gives effect to the acquisition of AMEX and the share issue as at December 31, 1997. The pro forma combined statements of operations for the year ended December 31, 1997 gives effect to the acquisition and the share issue as of January 1, 1997, including adjustments in respect to certain transactions that may not occur in future years. The pro forma combined statement of operations for the year ended December 31, 1996 gives effect to the acquisition and the share issue as of January 1, 1996, including adjustments in respect of certain transactions that may not occur in future years. 9 These pro forma statements give effect to the following assumptions and adjustments: a) Accounting for the acquisition of AMEX is by the purchase method of accounting. The following table shows the assumptions made with respect to the allocation of the aggregate purchase price to AMEX's net assets and the adjustments necessary to their historical cost carrying value. Included as part of the adjustments is the elimination of AMEX's shareholders' equity of $5,769,970. NET ASSETS ACQUIRED Current assets $ 2,347,053 Petroleum and natural gas interests, at historical cost 10,692,975 Other assets 1,109,356 Current liabilities (6,090,614) Long term debt (2,288,800) ------------ 5,769,970 Excess purchase price, attributed to petroleum and natural gas interests 6,504,228 ------------ Total consideration $ 12,274,198 ============ CONSIDERATION COMPRISED OF Share capital on issue of 7,335,001 shares at a fair value of $1.67 $ 12,274,198 ============
b) Site Restoration and abandonment This is to reallocate AMEX Site Restoration and Abandonment of $1,895,700 from Accumulated Depletion, Depreciation and Amortization to Site Restoration and Abandonment on the balance sheet as required under Canadian Generally Accepted Accounting Principles.
Year Ended Year Ended Dec. 31/97 Dec. 31/96 ---------- ---------- c) Depletion and depreciation Increased depletion and depreciation expense resulting from the higher cost base on acquisition of AMEX's petroleum and natural gas interests: $1,303,345 $ 866,821 ========== ========== d) Income taxes To record deferred income taxes on income of AMEX. $ 480,300 $ 661,400 ========= ========= e) Income taxes To reduce deferred income taxes of AMEX to reflect the utilization of OPC's losses carry forward. $(480,300) $(661,400) ========== ========== f) Gross up to working interest To gross-up AMEX petroleum and natural gas sales from net revenue interest reporting to working interest reporting in accordance with OPC's financial statement presentation. $3,806,465 $2,795,460 ========== ==========
10 3. PER COMMON SHARE INFORMATION Pro forma net income (loss) per common share has been calculated using the weighted average number of OPC common shares outstanding during the years ended December 31, 1997 and 1996 plus the additional OPC common shares that were issued pursuant to the AMEX acquisition and to be issued pursuant to this offering, all as if the additional common shares were outstanding at the beginning of each year. -----END PRIVACY-ENHANCED MESSAGE-----