Attached files
| file | filename |
|---|---|
| 8-K/A - Baron Energy Inc. | g5774.txt |
| EX-99.2 - Baron Energy Inc. | ex99-2.txt |
| EX-99.1 - Baron Energy Inc. | ex99-1.txt |
EXHIBIT 99.3
BARON ENERGY, INC.
UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS
The following unaudited pro forma combined financial statements and related
notes are presented to show the effects of the acquisition of the reverse merger
by Baron Energy, Inc. of the Combined Partnerships through Baron's wholly owned
subsidiary, Pertex Acquisition, Inc. The pro forma combined balance sheet is
based on the assumption that the Acquisition occurred effective January 31,
2010. The pro forma combined statement of operations is based on the assumption
that the Acquisition occurred effective at the beginning of the year presented.
The pro forma combined statement of operations is not indicative of the results
of operations due to the exclusion of the above mentioned expenses.
The Pro forma information for the period ended July 31, 2010 has been adjusted
for the reverse stock split that Baron Energy enacted on March 1, 2010. The Pro
forma data is based on assumptions and include adjustments as explained in the
notes to the unaudited pro forma financial statements. The unaudited pro forma
combined balance sheet and the unaudited combined statement of operations should
be read in conjunction with the notes thereto of the Combined Partnerships for
the years ended July 31, 2009 and 2008 and the quarterly financial statements
for the six months ended January 31, 2010.
BARON ENERGY, INC. AND SUBSIDIARIES
UNAUDITED PRO FORMA COMBINED BALANCE SHEET
JANUARY 31, 2010
Combined Baron
Baron Partnerships Pro Forma Pro Forma
Historical Historical Adjustments Combined
---------- ---------- ----------- --------
ASSETS
Current assets:
Cash and cash equivalents $ 5,630 $ 9,201 $ -- $ 14,831
Accounts receivable -- 43,298 -- 43,298
Accounts receivable - related party -- 12,473 -- 12,473
Prepaid expenses 103,305 -- -- 103,305
----------- ----------- ----------- -----------
Total current assets 108,935 64,972 -- 173,907
Oil and natural gas properties, net using
successful efforts accounting -- 1,414,438 -- 1,414,438
Investments -- 216,000 -- 216,000
Restricted cash -- 50,748 -- 50,748
----------- ----------- ----------- -----------
Total assets $ 108,935 $ 1,746,158 $ -- $ 1,855,093
=========== =========== =========== ===========
LIABILITIES AND STOCHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Accounts payable $ 18,910 $ 342,456 $ -- $ 361,366
Accrued expenses -- 520,621 -- 520,621
Accounts payable -related parties -- 548,904 -- 548,904
Note payable -- 2,458,487 -- 2,458,487
Notes payable-related parties -- 80,438 -- 80,438
Production payable -- 109,120 -- 109,120
----------- ----------- ----------- -----------
Total current liabilities 18,910 4,060,026 -- 4,078,936
Asset retirement obligations 5,121 203,691 -- 208,812
----------- ----------- ----------- -----------
Total liabilities 24,031 4,263,717 -- 4,287,748
Stockholders' equity (deficit):
Common stock 23,350 -- 20,000 (b) 40,000
1,792,273 (a)
(1,792,273) (d)
1,000 (f)
(4,350) (e)
Partners' capital -- (2,517,559) 2,517,559 (a) --
Additional paid-in capital (deficit) 5,396,650 -- 1,792,273 (d) 2,597,177
(5,335,096) (c)
(20,000) (b)
(4,350) (e)
(759,000) (f)
Accumulated deficit (5,335,096) -- 5,335,096 (c) (5,069,832)
(4,309,832) (a)
(760,000) (f)
----------- ----------- ----------- -----------
Total stockholders' equity (deficit) 84,904 (2,517,559) -- (2,432,655)
----------- ----------- ----------- -----------
Total liabilities and stockholders' equity (deficit) $ 108,935 $ 1,746,158 $ -- $ 1,855,093
=========== =========== =========== ===========
The accompanying notes to unaudited pro forma combined financial statements
are an integral part of these financial statements.
2
BARON ENERGY, INC. AND SUBSIDIARIES
UNAUDITED PRO FORMA COMBINED STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED JULY 31, 2009
Combined Baron
Baron Partnerships Pro Forma Pro Forma
Historical Historical Adjustments Combined
------------ ------------ -------------- ------------
Revenues: $ 5,092 $ 745,301 $ -- $ 750,393
Operating expenses:
Lease operating cost 45,995 701,199 -- 747,194
Depreciation, depletion, amortization,
and accretion 443 214,521 -- 214,964
General and administrative expenses 182,244 154,755 -- 336,999
Impairment of oil and gas properties 4,911,340 900,668 -- 5,812,008
Gain on sale of oil and gas properties -- (473,465) -- (473,465)
------------ ------------ -------------- ------------
Total operating expenses 5,140,022 1,497,678 -- 6,637,700
------------ ------------ -------------- ------------
Income (loss) from operations (5,134,930) (752,377) -- (5,887,307)
Other (income) expense:
Interest expense -- 432,434 -- 432,434
Other (income) expense -- (3,917) -- (3,917)
------------ ------------ -------------- ------------
Total other (income) expense -- 428,517 -- 428,517
------------ ------------ -------------- ------------
Net loss from continuing operations (5,134,930) (1,180,894) -- (6,315,824)
Net loss from discontinued operations (9,500) -- -- (9,500)
------------ ------------ -------------- ------------
Net Loss $ (5,144,430) $ (1,180,894) $ -- (6,325,324)
============ ============ ============== ============
Basic and diluted loss per share attributable to:
Continuing operations: $ (0.32) $ (0.06) $ (0.18)
============ ============== ============
Discontinued operations $ (0.00) $ -- $ (0.00)
============ ============== ============
Net loss per share $ (0.32) $ (0.06) $ (0.18)
============ ============== ============
Weighted average number of shares outstanding,
basic and diluted 15,817,534 20,000,000 35,817,534
============ ============== ============
The accompanying notes to unaudited pro forma combined financial statements
are an integral part of these financial statements.
3
BARON ENERGY, INC. AND SUBSIDIARIES
UNAUDITED PRO FORMA COMBINED STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED JANUARY 31, 2010
Combined Baron
Baron Partnerships Pro Forma Pro Forma
Historical Historical Adjustments Combined
------------ ------------ -------------- ------------
Revenues: $ -- $ 223,780 $ -- $ 223,780
Operating expenses:
Lease operating cost 6,653 234,018 -- 240,671
Depreciation, depletion, amortization,
and accretion 241 68,089 -- 68,330
General and administrative expenses 163,276 276,063 -- 439,339
Gain on sale of oil and gas properties -- (361,526) -- (361,526)
------------ ------------ -------------- ------------
Total operating expenses 170,170 216,644 -- 386,814
------------ ------------ -------------- ------------
Income (loss) from operations (170,170) 7,136 -- (163,034)
Other (income) expense:
Other income -- (1,912) -- (1,912)
Interest expense -- 315,526 -- 315,526
------------ ------------ -------------- ------------
Total other income (expense) -- 313,614 -- 313,614
------------ ------------ -------------- ------------
Net Loss $ (170,170) $ (306,478) $ -- $ (476,648)
============ ============ ============== ============
Basic and diluted loss per share $ (0.01) $ (0.02) $ (0.01)
============ ============ ============
Weighted average number of shares outstanding,
basic and diluted 22,301,630 20,000,000 42,301,630
============ ============ ============
The accompanying notes to unaudited pro forma combined financial statements
are an integral part of these financial statements.
4
BARON ENERGY, INC.
NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS
BASIS OF PRESENTATION
The unaudited pro forma combined balance sheet as of January 31, 2010 and the
unaudited pro forma combined statements of operations for the six months ended
January 31, 2010 are based on the unaudited financial statements of Baron
Energy, Inc, and the Combined Partnerships, the unaudited combined financial
statements of Esconde Resources, Inc. and Permian Legend Petroleum, Inc. for the
six months ended January 31, 2010, and the adjustments and assumptions described
below.
The unaudited pro forma combined statements of operations for the year ended
July 31, 2009 are based on the audited financial statements of Baron Energy,
Inc., the audited combined financial statements of Esconde Resources, Inc. and
Permian Legend Petroleum, Inc. for the year ended July 31, 2009, and the
adjustments and assumptions described below.
PRO FORMA ADJUSTMENTS
The unaudited pro forma combined statements of operations reflect the following
adjustments:
a. Record the incorporation of the Combined Partnerships into no par
common stock.
b. Record the issuance of 20,000,000 shares of Baron in the Merger
Acquisition.
c. Record the recapitalization of Baron during the reverse merger.
d. Record the paid in capital of the Combined Partnerships upon issuance
of Baron common stock with par value of $0.001.
e. On February 08, 2010, the Company issued 1 million shares to a
consultant for various investor and public relation service.
f. On February 22, 2010, the Company redemmed 4,350,000 shares from the
founder Albert Albah for no consideration as agreed upon in the
reverse merger agreement.