Attached files
| file | filename |
|---|---|
| 8-K - 8-K - ZaZa Energy Corp | a13-17491_18k.htm |
| EX-99.1 - EX-99.1 - ZaZa Energy Corp | a13-17491_1ex99d1.htm |
| EX-10.1 - EX-10.1 - ZaZa Energy Corp | a13-17491_1ex10d1.htm |
Exhibit 99.2
UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL DATA
The unaudited pro forma consolidated statements of income for the three months ended March 31, 2013 and year ended December 31, 2012 have been prepared as though the divestiture had occurred on January 1, 2013 and January 1, 2012, respectively. The unaudited pro forma consolidated balance sheet at March 31, 2013 has been prepared as though the divestiture had occurred on March 31, 2013. The pro forma adjustments are based on available information and assumptions that our management believes are reasonable; however, such adjustments are subject to change based on the finalization of the terms of the divestiture. In addition, such adjustments are estimates and may not prove to be accurate.
The unaudited pro forma financial statements are provided for illustrative purposes only and do not purport to represent what the actual consolidated results of operations or the consolidated financial position of ZaZa Energy Corporation would have been had the transactions occurred on the dates assumed, nor are they necessarily indicative of future consolidated results of operations or consolidated financial position.
PRO FORMA CONSOLIDATED BALANCE SHEET
(Unaudited)
AS OF MARCH 31, 2013
|
|
|
Historical |
|
Pro Forma |
|
Pro Forma |
| |||
|
|
|
|
|
|
|
|
| |||
|
ASSETS |
|
|
|
|
|
|
| |||
|
Current assets: |
|
|
|
|
|
|
| |||
|
Cash and cash equivalents |
|
$ |
7,991 |
|
$ |
30,635 |
A |
$ |
38,626 |
|
|
Restricted cash |
|
21,602 |
|
|
|
21,602 |
| |||
|
Accounts receivable |
|
1,659 |
|
|
|
1,659 |
| |||
|
Assets held for sale, net |
|
42,401 |
|
(42,401 |
)B |
— |
| |||
|
Prepayments and other current assets |
|
3,746 |
|
|
|
3,746 |
| |||
|
Total current assets |
|
77,399 |
|
(11,766 |
) |
65,633 |
| |||
|
|
|
|
|
|
|
|
| |||
|
Property and equipment: |
|
|
|
|
|
|
| |||
|
Oil and gas properties, successful efforts method |
|
122,683 |
|
|
|
122,683 |
| |||
|
Furniture and fixtures |
|
2,800 |
|
|
|
2,800 |
| |||
|
Total property and equipment |
|
125,483 |
|
|
|
125,483 |
| |||
|
Accumulated depletion, depreciation and amortization |
|
(2,292 |
) |
|
|
(2,292 |
) | |||
|
Property and equipment, net |
|
123,191 |
|
|
|
123,191 |
| |||
|
|
|
|
|
|
|
|
| |||
|
Assets held for sale, net |
|
14,887 |
|
|
|
14,887 |
| |||
|
Other assets |
|
273 |
|
|
|
273 |
| |||
|
|
|
|
|
|
|
— |
| |||
|
Total assets |
|
$ |
215,750 |
|
$ |
(11,766 |
) |
$ |
203,984 |
|
|
|
|
|
|
|
|
|
| |||
|
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) |
|
|
|
|
|
|
| |||
|
Current liabilities: |
|
|
|
|
|
|
| |||
|
Accounts payable - trade |
|
$ |
7,924 |
|
$ |
|
|
$ |
7,924 |
|
|
Deferred income taxes |
|
11,107 |
|
|
|
11,107 |
| |||
|
Accrued liabilities |
|
15,385 |
|
|
|
15,385 |
| |||
|
Senior Secured Notes, net of discount |
|
6,247 |
|
(6,247 |
)C |
— |
| |||
|
Convertible Senior Notes, net of discount |
|
25,938 |
|
|
|
25,938 |
| |||
|
Embedded conversion options associated with Convertible Senior Notes |
|
15,034 |
|
|
|
15,034 |
| |||
|
Income taxes payable |
|
3,601 |
|
|
|
3,601 |
| |||
|
Total current liabilities |
|
85,236 |
|
(6,247 |
) |
78,989 |
| |||
|
|
|
|
|
|
|
|
| |||
|
Long-term accrued liabilities |
|
52 |
|
|
|
52 |
| |||
|
Asset retirement obligations |
|
16 |
|
|
|
16 |
| |||
|
Deferred income taxes |
|
31,615 |
|
|
|
31,615 |
| |||
|
Long-term payable - related parties |
|
4,128 |
|
|
|
4,128 |
| |||
|
Subordinated notes |
|
47,330 |
|
|
|
47,330 |
| |||
|
Senior Secured Notes, net of discount |
|
20,847 |
|
971 |
C |
21,818 |
| |||
|
Warrants associated with Senior Secured Notes |
|
27,771 |
|
|
|
27,771 |
| |||
|
Total liabilities |
|
216,995 |
|
971 |
|
217,966 |
| |||
|
|
|
|
|
|
|
|
| |||
|
Stockholders’ equity (deficit): |
|
|
|
|
|
|
| |||
|
Preferred stock, $0.01 par value, 25,000,000 shares authorized; zero issued or outstanding |
|
— |
|
|
|
— |
| |||
|
Common stock, $0.01 par value, 250,000,000 shares authorized; 102,544,001 and 102,519,001 shares issued and outstanding at March 31, 2013 and December 31, 2012, respectively |
|
1,025 |
|
|
|
1,025 |
| |||
|
Additional paid-in capital |
|
104,723 |
|
|
|
104,723 |
| |||
|
Accumulated retained deficit |
|
(106,926 |
) |
(6,490 |
)B |
(113,416 |
) | |||
|
Accumulated other comprehensive income (loss) |
|
(67 |
) |
|
|
(67 |
) | |||
|
Total stockholders’ equity (deficit) |
|
(1,245 |
) |
(6,490 |
) |
(7,735 |
) | |||
|
Total liabilities and stockholders’ equity (deficit) |
|
$ |
215,750 |
|
$ |
(11,766 |
) |
$ |
203,984 |
|
PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
(Unaudited)
FOR THE THREE MONTHS ENDED MARCH 31, 2013
|
|
|
Historical |
|
Pro Forma |
|
Pro Forma |
| |||
|
|
|
(In thousands, except per share data) |
| |||||||
|
Revenues and other income: |
|
|
|
|
|
|
| |||
|
Oil and gas revenues |
|
$ |
2,797 |
|
$ |
(2,318 |
)D |
$ |
479 |
|
|
Other income |
|
— |
|
|
|
— |
| |||
|
Total revenues and other income |
|
2,797 |
|
(2,318 |
) |
479 |
| |||
|
|
|
|
|
|
|
|
| |||
|
Operating costs and expenses: |
|
|
|
|
|
|
| |||
|
Lease operating expense |
|
433 |
|
(228 |
)D |
205 |
| |||
|
Exploration expense |
|
— |
|
|
|
— |
| |||
|
Depreciation, depletion and amortization |
|
1,347 |
|
(1,154 |
)D |
193 |
| |||
|
Accretion expense |
|
11 |
|
(4 |
)D |
7 |
| |||
|
Impairment of oil and gas properties |
|
— |
|
|
|
— |
| |||
|
General and administrative |
|
6,858 |
|
|
|
6,858 |
| |||
|
Total operating costs and expenses |
|
8,649 |
|
(1,386 |
) |
7,263 |
| |||
|
|
|
|
|
|
|
|
| |||
|
Operating loss |
|
(5,852 |
) |
(932 |
) |
(6,784 |
) | |||
|
|
|
|
|
|
|
|
| |||
|
Other expenses: |
|
|
|
|
|
|
| |||
|
Foreign currency exchange (gain) loss |
|
— |
|
|
|
— |
| |||
|
Loss on extinguishment of debt |
|
15,092 |
|
|
|
15,092 |
| |||
|
Interest expense, net |
|
3,555 |
|
|
|
3,555 |
| |||
|
(Gain) loss on fair value of warrants |
|
(11,162 |
) |
|
|
(11,162 |
) | |||
|
Gain on fair value of embedded conversion option |
|
(6,348 |
) |
|
|
(6,348 |
) | |||
|
Total other expenses (income) |
|
1,137 |
|
|
|
1,137 |
| |||
|
|
|
|
|
|
|
|
| |||
|
Income (loss) from continuing operations before income taxes |
|
(6,989 |
) |
(932 |
) |
(7,921 |
) | |||
|
Income tax expense (benefit) |
|
(4,665 |
) |
(326 |
)D |
(4,991 |
) | |||
|
Net income (loss) from continuing operations |
|
(2,324 |
) |
(606 |
) |
(2,930 |
) | |||
|
Loss from discontinued operations, net of income taxes |
|
(554 |
) |
|
|
(554 |
) | |||
|
Net income (loss) |
|
$ |
(2,878 |
) |
$ |
(606 |
) |
$ |
(3,484 |
) |
|
|
|
|
|
|
|
|
| |||
|
Basic income (loss) per share: |
|
|
|
|
|
|
| |||
|
Continuing operations |
|
$ |
(0.02 |
) |
$ |
— |
|
$ |
(0.02 |
) |
|
Discontinued operations |
|
(0.01 |
) |
|
|
(0.01 |
) | |||
|
Total basic income (loss) per share |
|
$ |
(0.03 |
) |
$ |
— |
|
$ |
(0.03 |
) |
|
|
|
|
|
|
|
|
| |||
|
Diluted income (loss) per share: |
|
|
|
|
|
|
| |||
|
Continuing operations |
|
$ |
(0.02 |
) |
$ |
— |
|
$ |
(0.02 |
) |
|
Discontinued operations |
|
(0.01 |
) |
|
|
(0.01 |
) | |||
|
Total diluted income (loss) per share |
|
$ |
(0.03 |
) |
$ |
— |
|
$ |
(0.03 |
) |
|
|
|
|
|
|
|
|
| |||
|
Weighted average shares outstanding: |
|
|
|
|
|
|
| |||
|
Basic |
|
102,523 |
|
|
|
102,523 |
| |||
|
Diluted |
|
102,523 |
|
|
|
102,523 |
| |||
|
|
|
|
|
|
|
|
| |||
|
Consolidated Statement of Comprehensive Income (Loss) |
|
|
|
|
|
|
| |||
|
Net income (loss) |
|
$ |
(2,878 |
) |
$ |
(606 |
) |
$ |
(3,484 |
) |
|
Foreign currency translation adjustments, net of taxes |
|
(99 |
) |
|
|
(99 |
) | |||
|
Comprehensive income (loss) |
|
$ |
(2,977 |
) |
$ |
(606 |
) |
$ |
(3,583 |
) |
PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
(Unaudited)
FOR THE YEAR ENDED DECEMBER 31, 2012
|
|
|
Historical |
|
Pro Forma |
|
Pro Forma |
| |||
|
|
|
(In thousands, except per share data) |
| |||||||
|
Revenues and other income: |
|
|
|
|
|
|
| |||
|
Oil and gas revenues |
|
$ |
9,583 |
|
$ |
(3,633 |
)E |
$ |
5,950 |
|
|
Bonus income |
|
— |
|
|
|
— |
| |||
|
Other income |
|
195,569 |
|
|
|
195,569 |
| |||
|
Total revenues and other income |
|
205,152 |
|
(3,633 |
) |
201,519 |
| |||
|
Operating costs and expenses: |
|
|
|
|
|
|
| |||
|
Lease operating expense |
|
3,602 |
|
(717 |
)E |
2,885 |
| |||
|
Exploration expense |
|
12,913 |
|
|
|
12,913 |
| |||
|
Depreciation, depletion and amortization |
|
6,641 |
|
(2,460 |
)E |
4,181 |
| |||
|
Accretion expense |
|
21 |
|
(4 |
)E |
17 |
| |||
|
Impairment of oil and gas properties |
|
9,764 |
|
|
|
9,764 |
| |||
|
General and administrative |
|
97,941 |
|
|
|
97,941 |
| |||
|
Total operating costs and expenses |
|
130,882 |
|
(3,181 |
) |
127,701 |
| |||
|
|
|
|
|
|
|
|
| |||
|
Operating income (loss) |
|
74,270 |
|
(452 |
) |
73,818 |
| |||
|
Other expense |
|
|
|
|
|
|
| |||
|
Foreign currency exchange (gain) loss |
|
65 |
|
|
|
65 |
| |||
|
Loss on extinguishment of debt |
|
28,026 |
|
|
|
28,026 |
| |||
|
Interest expense, net |
|
14,705 |
|
|
|
14,705 |
| |||
|
(Gain) loss on fair value of warrants |
|
(5,589 |
) |
|
|
(5,589 |
) | |||
|
(Gain) loss on fair value of embedded conversion options |
|
8,199 |
|
|
|
8,199 |
| |||
|
Total other expense |
|
45,406 |
|
|
|
45,406 |
| |||
|
|
|
|
|
|
|
|
| |||
|
Income (loss) from continuing operations before income taxes |
|
28,864 |
|
(452 |
) |
28,412 |
| |||
|
Income tax expense (benefit) |
|
82,920 |
|
(158 |
)E |
82,762 |
| |||
|
Income (loss) from continuing operations |
|
(54,056 |
) |
(294 |
) |
(54,350 |
) | |||
|
(Loss) from discontinued operations, net of income taxes |
|
(52,171 |
) |
|
|
(52,171 |
) | |||
|
Net income (loss) |
|
$ |
(106,227 |
) |
$ |
(294 |
) |
$ |
(106,521 |
) |
|
|
|
|
|
|
|
|
| |||
|
Basic income (loss) per share: |
|
|
|
|
|
|
| |||
|
Continuing operations |
|
$ |
(0.55 |
) |
$ |
(0.01 |
) |
$ |
(0.56 |
) |
|
Discontinued operations |
|
(0.53 |
) |
|
|
(0.53 |
) | |||
|
|
|
$ |
(1.08 |
) |
$ |
(0.01 |
) |
$ |
(1.09 |
) |
|
|
|
|
|
|
|
|
| |||
|
Diluted income (loss) per share: |
|
|
|
|
|
|
| |||
|
Continuing operations |
|
$ |
(0.58 |
) |
$ |
— |
|
$ |
(0.58 |
) |
|
Discontinued operations |
|
(0.53 |
) |
|
|
(0.53 |
) | |||
|
|
|
$ |
(1.11 |
) |
$ |
|
|
$ |
(1.11 |
) |
|
|
|
|
|
|
|
|
| |||
|
Weighted average shares outstanding: |
|
|
|
|
|
|
| |||
|
Basic |
|
98,029 |
|
|
|
98,029 |
| |||
|
Diluted |
|
99,684 |
|
|
|
99,684 |
| |||
|
|
|
|
|
|
|
|
| |||
|
Consolidated Statement of Comprehensive Income |
|
|
|
|
|
|
| |||
|
Net income (loss) |
|
$ |
(106,227 |
) |
$ |
(294 |
) |
$ |
(106,521 |
) |
|
Foreign currency translation adjustments, net of taxes |
|
32 |
|
|
|
32 |
| |||
|
Comprehensive income (loss) |
|
$ |
(106,195 |
) |
$ |
(294 |
) |
$ |
(106,489 |
) |
NOTES TO THE UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
Overview
On July 26, 2013, ZaZa Energy Corporation (the “Company”), closed a purchase and sale agreement with SN Marquis, LLC, a subsidiary of Sanchez Energy Corporation, to sell approximately 10,300 net acres of the Company’s properties in the Eagle Ford trend located in Fayette, Gonzalez and Lavaca Counties, Texas, which we refer to as our Moulton properties, including seven producing wells located on the Moulton properties, for approximately $28.8 million and received approximately $29.3 million in cash. Additionally, on April 5, 2013, the Company closed a purchase and sale agreement with the same party for approximately $9.2 million and received approximately $8.8 million in cash.
Pro forma adjustment A.
Pro forma adjustments A relate to the cash received for the two Moulton transactions of approximately $29.3 million and approximately $8.8 million offset by pre-payment requirements of the Senior Secured Notes of approximately $7.5 million resulting in a net cash increase of approximately $30.6 million.
Pro forma adjustment B.
Pro forma adjustments B relate to the elimination of the Moulton assets that were classified as current assets held for sale in the amount of approximately $42.4 million. The difference between the estimated fair value as of March 31, 2013 and cash proceeds reduced accumulated retained earnings by approximately $6.5 million.
Pro forma adjustment C.
Pro forma adjustment C relates to the required prepayment of the Senior Secured Notes. The difference between the cash amount paid of approximately $7.5 million and reduction in the principal of $5.3 million relates to prepaid interest and penalties totaling approximately $2.2 million. The $1.0 million reclassification between current and non-current is due to a decrease in the sales price of the Moulton properties resulting in a lower prepayment.
Pro forma adjustment D.
Pro forma adjustment D is to eliminate the impact of the Moulton properties on revenue, lease operating expenses, depreciation, depletion and amortization, accretion expense and income taxes at the federal tax rate for the U.S. for the three months ended March 31, 2013.