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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report June 25, 1999
(Date of earliest event reported)
BRIGHAM EXPLORATION COMPANY
(Exact name of registrant as specified in its charter)
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<S> <C> <C>
Delaware 000-22433 75-2692967
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation or organization) File Number) Identification Number)
</TABLE>
6300 Bridge Point Parkway
Bldg. 2, Suite 500
Austin, Texas 78730
(Address of principal executive offices)
Registrant's telephone number, including area code (512) 427-3300
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ITEM 2. DISPOSITION OF ASSETS
On June 25, 1999, Brigham Exploration Company (the "Company") closed
the sale of its entire interest in certain producing and non-producing natural
gas and oil properties located in its Anadarko Basin province to Ward-Chitwood
Energy B, L.L.C. for a sales price of $16.6 million and to Chesapeake
Mid-Continent Corp. for a sales price of $500,000. The Company received a net
combined total of $16.9 million after adjustment for transaction costs. Net
proceeds have been used for repayment of a portion of the Company's notes
payable.
ITEM 7. PRO FORMA FINANCIAL INFORMATION
Unaudited Pro Forma Condensed Consolidated Financial Statements
of Brigham Exploration Company
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Page
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Pro Forma Financial Information........................ 3
Unaudited Pro Forma Condensed Consolidated Balance
Sheet as of March 31, 1999................... 4
Unaudited Pro Forma Condensed Consolidated Statement
of Operations for the Three Months Ended
March 31, 1999................................ 5
Unaudited Pro Forma Condensed Consolidated Statement
of Operations for the Year Ended
December 31, 1998............................. 6
Notes to Unaudited Pro Forma Condensed Consolidated
Financial Statements......................... 7
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BRIGHAM EXPLORATION COMPANY
PRO FORMA FINANCIAL INFORMATION
The accompanying unaudited pro forma financial statements are
presented to reflect the divestiture by Brigham Exploration Company
(the"Company") of its entire interest in certain producing and non-producing
natural gas and oil properties in the Company's Anadarko Basin province (the
"Divestiture"). The Divesture closed on June 25, 1999, and was effective June
1, 1999.
The unaudited pro forma balance sheet has been prepared to give effect
to the Divestiture described above as if the transaction occurred on March 31,
1999. The accompanying unaudited pro forma statements of operations for the
three months ended March 31, 1999 and the year ended December 31, 1998 have
been prepared to give effect to the Divestiture as if the transaction occurred
on January 1, 1998.
The unaudited pro forma financial statements of the Company are not
necessarily indicative of the results for the periods presented had these
transactions taken place on the dates indicated. In addition, future results
may vary significantly from the results reflected in the accompanying unaudited
pro forma financial statements because of normal production declines, changes
in product prices, and the success of future exploration and development
activities, among other factors. The unaudited pro forma financial statements
should be read in conjunction with the Company's historical consolidated
financial statements and notes thereto as of and for the period ended December
31, 1998 as included on the Company's Annual Report on Form 10-K filed with the
Securities and Exchange Commission, and the Company's historical financial
statements and notes thereto as of and for the quarterly period ended March 31,
1999 as filed with the Securities and Exchange Commission.
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BRIGHAM EXPLORATION COMPANY
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED
BALANCE SHEET
MARCH 31, 1999
(in thousands)
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Pro Forma
Historical Adjustments Pro Forma
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ASSETS
Current assets:
Cash and cash equivalents $ 7,018 $ -- $ 7,018
Accounts receivable 4,599 -- 4,599
Prepaid expenses 257 -- 257
--------- ------------- ---------
Total current assets 11,874 -- 11,874
--------- ------------- ---------
Natural gas and oil properties, at cost, net 133,283 (16,850)(a) 116,433
Other property and equipment, at cost, net 1,953 -- 1,953
Drilling advances paid 310 -- 310
Deferred loan fees 3,632 -- 3,632
Other noncurrent assets 181 -- 181
--------- ------------- ---------
$ 151,233 $ (16,850) $ 134,383
========= ============= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 19,660 $ -- $ 19,660
Accrued drilling costs 2,012 -- 2,012
Participant advances received 661 -- 661
Other current liabilities 1,505 -- 1,505
--------- ------------- ---------
Total current liabilities 23,838 -- 23,838
--------- ------------- ---------
Notes payable 59,000 (16,850)(b) 42,150
Senior subordinated notes, net 36,699 -- 36,699
Other noncurrent liabilities 5,573 -- 5,573
Stockholders' equity:
Preferred stock, $.01 par value, 10 million shares
authorized, none issued and outstanding -- -- --
Common stock, $.01 par value, 30 million shares
authorized, 14,309,071 issued and outstanding 143 -- 143
at March 31, 1999
Additional paid-in capital 62,817 -- 62,817
Unearned stock compensation (768) -- (768)
Accumulated deficit (36,069) -- (36,069)
--------- ------------- ---------
Total stockholders' equity 26,123 -- 26,123
--------- ------------- ---------
$ 151,233 $ (16,850) $ 134,383
========= ============= =========
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The accompanying notes are an integral part of these statements.
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BRIGHAM EXPLORATION COMPANY
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED
STATEMENT OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 1999
(in thousands, except per share data)
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Pro Forma
Historical Adjustments Pro Forma
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Revenues:
Natural gas and oil sales $ 3,191 $ (437)(c) $ 2,754
Workstation revenue 90 -- 90
-------- -------- --------
3,281 (437) 2,844
-------- -------- --------
Costs and expenses:
Lease operating 535 (50)(c) 485
Production taxes 169 (24)(c) 145
General and administrative 918 -- 918
Depletion of natural gas and oil properties 1,350 (186)(d) 1,164
Depreciation and amortization 127 -- 127
Amortization of stock compensation 58 -- 58
-------- -------- --------
3,157 (260) 2,897
-------- -------- --------
Operating income (loss) 124 (177) (53)
-------- -------- --------
Other income (expense):
Interest income 24 -- 24
Interest expense (2,817) 320(e) (2,497)
-------- -------- --------
(2,793) 320 (2,473)
-------- -------- --------
Net loss before income taxes (2,669) 143 (2,526)
Income tax benefit -- -- --
-------- -------- --------
Net loss $ (2,669) $ 143 $ (2,526)
======== ======== ========
Net loss per share:
Basic / Diluted $ (0.20) $ (0.19)
Weighted average common shares outstanding:
Basic / Diluted 13,317 13,317
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The accompanying notes are an integral part of these statements.
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BRIGHAM EXPLORATION COMPANY
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED
STATEMENT OF OPERATIONS
FOR THE TWELVE MONTHS ENDED DECEMBER 31, 1998
(in thousands, except per share data)
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Pro Forma
Historical Adjustments Pro Forma
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Revenues:
Natural gas and oil sales $ 13,799 $ (2,023)(f) $ 11,776
Workstation revenue 390 -- 390
-------- -------- --------
14,189 (2,023) 12,166
-------- -------- --------
Costs and expenses:
Lease operating 2,172 (219)(f) 1,953
Production taxes 850 (146)(f) 704
General and administrative 4,672 -- 4,672
Depletion of natural gas and oil properties 8,410 (581)(g) 7,829
Depreciation and amortization 413 -- 413
Capitalized ceiling impairment 24,847 3,803 (h) 28,650
Amortization of stock compensation 372 -- 372
-------- -------- --------
41,736 2,857 44,593
-------- -------- --------
Operating loss (27,547) (4,880) (32,427)
-------- -------- --------
Other income (expense):
Interest income 136 -- 136
Interest expense (7,120) 1,397 (i) (5,723)
-------- -------- --------
(6,984) 1,397 (5,587)
-------- -------- --------
Net loss before income taxes (34,531) (3,483) (38,014)
Income tax benefit 1,186 -- 1,186
-------- -------- --------
Net loss $(33,345) $ (3,483) $(36,828)
======== ======== ========
Net loss per share:
Basic/Diluted $ (2.64) $ (2.92)
Common shares outstanding:
Basic/Diluted 12,626 12,626
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The accompanying notes are an integral part of these statements.
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BRIGHAM EXPLORATION COMPANY
NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
1. SUMMARY OF TRANSACTION
The accompanying unaudited pro forma financial statements are presented
to reflect the Divestiture by the Company of its entire interest in
certain producing and non-producing natural gas and oil properties in
the Company's Anadarko Basin province. The Divestiture closed on June
25, 1999, and was effective June 1, 1999. The Company received a net
combined total of $16.9 million after adjustment for transaction costs
to the combined total sales price of $17.1 million. Net proceeds from
the sale have been used for repayment of a portion of the Company's
notes payable.
2. BASIS OF PRESENTATION
The accompanying unaudited pro forma balance sheet has been prepared to
give effect to the Divestiture described above as if the transaction
occurred on March 31, 1999. The accompanying unaudited pro forma
statements of operations for the three months ended March 31, 1999 and
the year ended December 31, 1998 have been prepared to give effect to
the Divestiture as if the transaction occurred on January 1, 1998.
3. PRO FORMA ADJUSTMENTS
The unaudited pro forma financial statements reflect the following pro
forma adjustments related to the Divestiture:
(a) Proceeds from the Divestiture are credited to natural gas and oil
properties.
(b) Decrease in notes payable resulting from repayment with proceeds
from the Divestiture.
(c) Elimination of natural gas and oil sales revenues, lease
operating expenses and production taxes attributable to the
properties sold in the Divestiture for the three months ended
March 31, 1999.
(d) Adjustment to depletion of natural gas and oil properties
resulting from recognition of proceeds from the Divestiture and
elimination of production and reserves attributable to the
properties sold in the Divestiture for the three months ended
March 31, 1999.
(e) Reduction of interest expense due to assumed repayment of the
Company's notes payable with proceeds from the Divestiture for
the three months ended March 31, 1999.
(f) Elimination of natural gas and oil sales revenues, lease
operating expenses and production taxes attributable to the
properties sold in the Divestiture for the year ended December
31, 1998.
(g) Adjustment to depletion of natural gas and oil properties
resulting from recognition of proceeds from the Divestiture and
elimination of production and reserves attributable to the
properties sold in the Divestiture for the year ended December
31, 1998.
(h) Adjustment to the capitalized ceiling impairment for the
elimination of costs and reserves attributable to the
Divestiture.
(i) Reduction of interest expense due to assumed repayment of the
Company's notes payable with proceeds from the Divestiture for
the year ended December 31, 1998.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto, duly authorized, in the City of Austin, State of Texas,
on the 9th day of June, 1999.
BRIGHAM EXPLORATION COMPANY
By: /s/ Ben M. Brigham
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Ben M. Brigham
President , Chief Executive Officer
and Chairman of the Board
By: /s/ Craig M. Fleming
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Craig M. Fleming
Chief Financial Officer
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