-----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, SJQW4ln9u/gv6Tl1NeVbn7bgcyBEhHCTdnlyRBHm+IhkvimoMVWQ/xeQcpp3AuuE i6ZehFPUgmrd8oMLgdY4PQ== 0000891020-98-000944.txt : 19980605 0000891020-98-000944.hdr.sgml : 19980605 ACCESSION NUMBER: 0000891020-98-000944 CONFORMED SUBMISSION TYPE: 8-K/A PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19980522 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19980604 SROS: NONE 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/A SEC ACT: SEC FILE NUMBER: 000-19020 FILM NUMBER: 98642586 BUSINESS ADDRESS: STREET 1: 600 595 HOWE STREET STREET 2: VANCOUVER BRITISH COLUMBIA CITY: CANADA V6C 2T5 STATE: A1 BUSINESS PHONE: 6046846886 MAIL ADDRESS: STREET 1: 600 595 HOWE ST STREET 2: VANCOUVER BRITISH COLUMBIA CITY: CANADA V6C 2T5 STATE: A1 8-K/A 1 AMENDMENT TO THE OPTIMA 8-K 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 8-K/A-1 PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 DATE OF REPORT: MAY 22, 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 V6C 2T5 (Address of Principal Executive Offices) (Zip Code) Registrant's Telephone Number., Including Area Code: (604) 684-6886 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 merger agreement with American Explorer, L.L.C. of Lafayette, Louisiana, in accordance with regulatory disclosure requirements, it has attached pro forma 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 Exhibit 7.2 has been amended to include results of operations through the March 31, 1998 quarter end.
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. June 02, 1998 OPTIMA PETROLEUM CORPORATION /s/RONALD P. BOURGEOIS Ronald P. Bourgeois Chief Financial Officer EX-7.2 2 EXHIBIT 7.2 FOR OPTIMA 1 OPTIMA PETROLEUM CORPORATION Pro Forma Balance Sheet As at March 31, 1998
================================================================================================================ Pro Forma OPC AMEX Adjustments Notes Consolidated - --------------------------------------------------------------------------------------------------------------- ASSETS CURRENT Cash and cash equivalents $ 5,033,461 $ 630,894 $5,664,355 Accounts receivable 1,942,974 1,321,902 3,264,876 Note receivable - current portion 128,599 - 128,599 - --------------------------------------------------------------------------------------------------------------- 7,105,034 1,952,796 9,057,830 OTHER Cash held in trust 705,893 1,141,074 1,846,967 Advances to operators 473,886 - 473,886 Note receivable - long term portion 262,502 - 262,502 Loan receivable - AMEX 849,960 (849,960) Petroleum and natural gas interests, full cost method 17,285,171 11,097,254 $7,159,171 2(a) 37,437,296 1,895,700 2(b) Deferred charges 276,308 - 276,308 - --------------------------------------------------------------------------------------------------------------- $ 26,958,754 $13,341,164 $49,354,789 =============================================================================================================== LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT Accounts payable and accrued liabilities $ 662,093 $3,579,689 $4,241,782 Current portion of long-term debt - 3,272,346 3,272,346 - --------------------------------------------------------------------------------------------------------------- 662,093 6,852,035 7,514,128 REVENUE IN DISPUTE 1,047,664 - 1,047,664 LONG-TERM DEBT 141,660 1,374,102 1,515,762 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 (6,761,871) 5,115,027 (5,115,027) 2(a) (6,761,871) - --------------------------------------------------------------------------------------------------------------- 24,738,040 5,115,027 37,012,238 - --------------------------------------------------------------------------------------------------------------- $ 26,958,754 $13,341,164 $49,354,789 ===============================================================================================================
See accompanying notes to pro forma financial statements. 2 OPTIMA PETROLEUM CORPORATION Pro Forma Statement of Operations Three Months Ended March 31, 1998
=========================================================================================================== Pro Forma OPC AMEX Adjustments Notes Combined - ----------------------------------------------------------------------------------------------------------- OPERATING REVENUE Petroleum and natural gas sales $ 1,119,473 $2,355,938 $659,781 2(f) $ 4,135,192 COSTS AND EXPENSES Royalties and production taxes 355,627 88,638 659,781 2(f) 1,104,046 Operating costs 338,175 1,000,966 1,339,141 Depletion and depreciation 872,714 1,154,794 425,116 2(c) 2,452,624 General and administrative 386,039 609,321 995,360 Interest and other revenue (99,109) (7,179) (106,288) Foreign exchange loss 246,462 - 246,462 Interest and bank charges 2,644 114,824 117,468 Amortization of deferred financing costs 17,082 - 17,082 - ----------------------------------------------------------------------------------------------------------- INCOME (LOSS) BEFORE INCOME TAXES (1,000,161) (605,426) (2,030,703) Income taxes - - - - ----------------------------------------------------------------------------------------------------------- NET INCOME(LOSS) FOR THE YEAR $ (1,000,161) (605,426) $ (2,030,703) =========================================================================================================== NET INCOME (LOSS) PER COMMON SHARE (Note 3) $ (0.09) N/A $ (0.11) ===========================================================================================================
See accompanying notes to pro forma financial statements. 3 OPTIMA PETROLEUM CORPORATION Pro Forma Statement of Operations Year Ended December 31, 1997
============================================================================================================ Pro Forma OPC AMEX Adjustments Notes Combined - ------------------------------------------------------------------------------------------------------------ OPERATING REVENUE Petroleum and natural gas sales $ 7,649,415 $9,403,334 $3,806,465 2(f) $ 20,859,214 COSTS AND EXPENSES 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 Depletion and depreciation 4,269,745 3,898,106 1,435,016 2(c) 9,602,867 Write-down of petroleum and natural gas interests 2,520,000 - 2,520,000 Provision for revenue dispute 1,023,998 - 1,023,998 Gain on sale of Canadian petroleum and natural gas interests (518,025) - (518,025) General and administrative 1,691,779 550,768 2,242,547 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 - ------------------------------------------------------------------------------------------------------------ INCOME (LOSS) BEFORE INCOME TAXES (4,684,220) 1,341,166 (4,778,070) Income taxes 151,000 - 480,300 2(d) 151,000 (480,300) 2(e) - ------------------------------------------------------------------------------------------------------------ INCOME (LOSS) FOR THE YEAR $ (4,835,220) $1,341,166 $ (4,929,070) ============================================================================================================ NET INCOME (LOSS) PER COMMON SHARE (Note 3) $ (0.43) N/A $ (0.27) ============================================================================================================
See accompanying notes to pro forma financial statements. 4 OPTIMA PETROLEUM CORPORATION NOTES TO PRO FORMA FINANCIAL STATEMENTS FOR THE THREE MONTHS ENDED MARCH 31, 1998 AND YEAR ENDED DECEMBER 31, 1997 (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 ("GAAP") in Canada. A reconciliation of Canadian and U.S. GAAP is provided in note 4. The pro forma statements have been prepared from the unaudited consolidated financial statements of OPC for the three months ended March 31, 1998 and from the audited consolidated financial statements of OPC for the year ended December 31, 1997 and from the unaudited financial statements of American Explorer, LLC ("AMEX") for the three months ended March 31, 1998 and from the audited financial statements of AMEX for the year ended December 31, 1997, 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 March 31, 1998 is translated at a current exchange rate at this date of $1.4166 and the statements of operations are translated at the average exchange rate for the statement period presented (March 31, 1998 - $1.4321; December 31, 1997 - $1.3846;). The pro forma statements are not necessarily indicative of either the results of operations that would have occurred for the three months ended March 31, 1998 or 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 unaudited consolidated financial statements of OPC and the unaudited financial statements of AMEX for the three months ended March 31, 1998 and 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. 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 March 31, 1998. The pro forma combined statements of operations for the three months ended March 31, 1998 and 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. 5 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 $5,115,027. NET ASSETS ACQUIRED Current assets $ 1,952,796 Petroleum and natural gas interests, at historical cost 11,097,254 Other assets 1,141,074 Current liabilities (6,852,035) Long term debt (2,224,062) ----------- 5,115,027 Excess purchase price, attributed to petroleum and natural gas interests 7,159,171 ------------ 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 ===========
The Company will also issue 1,667,001 in contingent stock issue rights which will be exchangeable for common shares of the Company if the Company's share price exceeds U.S.$5 per share for 20 consecutive trading days. As this contingent consideration is not reasonable determinable at this time, no amount has been recorded in the cost of the acquisition. Any contingent consideration will be recorded when reasonable determinable which, in this case, would be when the contingent stock issue rights are exercisable. 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.
Three Months Ended Year Ended March 31/98 Dec 31/97 ------------ ----------- 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: $ 425,116 $1,435,016 ============ ========== d) Income taxes To record deferred income taxes on income of AMEX $ -- $ 480,300 ============ ==========
6 e) Income taxes To reduce deferred income taxes of AMEX to reflect the utilization of OPC's losses carry forward. $ -- $ (480,300) ============= ========== 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. $ 659,781 $3,806,465 ============= ==========
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 three months ended March 31, 1998 and for the years ended December 31, 1997 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 period or year.
Three months ended Year ended March 31, December 31, 1998 1997 - ----------------------------------------------------------------------------------------------- Weighted average common shares, at historical 11,002,346 11,159,663 Shares issued pursuant to offering 7,335,001 7,335,001 - ----------------------------------------------------------------------------------------------- Weighted average common shares, pro forma 18,337,347 18,494,664 - -----------------------------------------------------------------------------------------------
. CANADA / U.S. GAAP RECONCILIATION The following Canada / U.S. GAAP reconciliation is provided for material differences affecting the reported amount in the pro forma financial statements: a) Pro forma balance sheet as at March 31, 1998 In 1995, the Company applied its opening deficit of $10,602,526 against its share capital. This adjustment is not in accordance with U.S. GAAP. At March 31, 1998 deficit is $10,602,526 higher or $17,364,397 and share capital is $10,602,526 higher or $53,768,413 for U.S. GAAP. b) Pro forma statement of operations for the three months ended March 31, 1998 There are no significant Canadian / U.S. GAAP differences. c) Pro forma statement of operations for the year ended December 31, 1997 - ---------------------------------------------------------------------------------- Loss for the year reported $ 4,929,070 Write-down of petroleum and natural gas interests (800,000) - ---------------------------------------------------------------------------------- Loss for U.S. GAAP $ 4,129,070 - ---------------------------------------------------------------------------------- Loss per share for U.S. GAAP $ 0.22 - ----------------------------------------------------------------------------------
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