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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
AMENDMENT NO. 1
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
Date of Report June 2, 1995
HARKEN ENERGY CORPORATION
(Exact name of registrant as specified in its charter)
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<S> <C> <C>
DELAWARE 0-9207 95-2841597
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(State or other jurisdiction of (Commission File Number) (I.R.S. Employer Identification No.)
incorporation or organization)
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5605 N. MacArthur Blvd, Suite 400, Irving, Texas, 75038
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (214)753-6900
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N/A
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(Former Name or Former Address, if changed Since Last Report)
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Item 7. (a.) Financial Statements of Business Acquired
Audited financial statements of Search as of December 31, 1994
are included in the Search Annual Report on Form 10-K, as amended, and are
incorporated herein by reference. Unaudited financial statements of Search as
of March 31, 1995 are included in the Search Quarterly Report on Form 10-Q, and
are incorporated herein by reference.
(b.) Pro Forma Financial Information
Unaudited pro forma financial information of Harken as of
December 31, 1994 reflecting the Merger are included in Harken's Annual Report
on Form 10-K, and is incorporated herein by reference. Pro forma financial
information of Harken as of March 31, 1995 is included below.
The following unaudited pro forma combined condensed financial
statements give effect to the above mentioned merger transaction, as well as
the May 12, 1995 Note Purchase Agreement which Harken entered into with several
European institutions and investors in the amount of $15,000,000 establishing a
credit facility to support Harken's future oil and gas reserve acquisitions,
exploration and development. The pro forma combined condensed balance sheet
gives effect to the transactions as if both had been consummated as of March
31, 1995. The pro forma combined condensed statement of operations for the
three months ended March 31, 1995 gives effect to the transactions as if both
had been consummated at the beginning of the period.
The pro forma data is presented for illustrative purposes only
and are not necessarily indicative of the financial position or operating
results that would have occurred had the transactions been consummated at the
dates indicated, nor are they indicative of future financial position or
operating results.
PRO FORMA COMBINED CONDENSED BALANCE SHEET
MARCH 31, 1995
(UNAUDITED)
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Harken Search Pro Forma
Actual Actual Adjustments Pro Forma
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Current Assets $ 6,602 $ 523 $(2) 2,600 $ 9,725
Property and Equipment, net 21,019 2,482 (1) 780 24,281
Investments in Former Subsidiaries 1,219 -- -- 1,219
Notes Receivable from Related Parties,
including interest 474 -- -- 474
Restricted Cash -- -- (2) 10,650 10,650
Other Assets 318 -- (1) (52) 2,016
(2) 1,750
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Total Assets $ 29,632 $ 3,005 $ 15,728 $ 48,365
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Current Liabilities $ 4,983 $ 172 $(1) 148 $ 5,303
Long-Term Debt -- 697 (1) (332) 15,365
(2) 15,000
Redeemable Preferred Stock 1,868 575 (1) (575) 1,868
Stockholders' Equity 22,781 1,561 (1) 1,487 25,829
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Total Liabilities & Stockholders' Equity $ 29,632 $ 3,005 $ 15,728 $ 48,365
=========== ============ =========== ==========
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PRO FORMA ADJUSTMENTS-PRO FORMA COMBINED CONDENSED BALANCE SHEET-
(1) Pro forma entry to record the acquisition of Search at March 31, 1995 in
exchange for Harken common stock. Purchase price was calculated using
the market value, discounted by 10%, of the actual number of shares of
Harken common stock issued according to the Merger Agreement. Such
purchase price results in a total investment in Search of approximately
$3,248,000, which includes approximately $200,000 of estimated
transaction costs.
(2) Pro forma entry to record the May 12, 1995 Note Purchase Agreement
establishing a $15,000,000 8% senior convertible note facility. Total
proceeds of $13,250,000 are net of approximately $1,750,000 of
commissions and issuance costs, and are restricted in a segregated cash
account, available only to the extent that the paying and conversion
agent is presented with evidence of sufficient collateral held by
Harken. Proceeds that are available are classified as a current asset.
PRO FORMA COMBINED CONDENSED STATEMENT OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 1995
(UNAUDITED)
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Harken Search Pro Forma
Actual Actual Adjustments Pro Forma
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Oil and gas revenue $ 1,173 $ 88 $ $ 1,261
Other revenues 426 -- (3) 166 592
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1,599 88 166 1,853
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Oil and gas operating expenses 422 32 454
General and administrative expenses 774 98 872
Depreciation and amortization 531 18 (1) 78 627
Interest and other 11 -- (2) 11 322
(3) 300
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1,738 148 389 2,275
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Income tax expense -- -- -- --
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Income (loss) from continuing operations $ (139) $ (60) $ (223) $ (422)
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Net loss per share from continuing
operations attributable to common stock $ (0.00) $ (0.01)
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Weighted Average Shares Outstanding 60,642,853 62,810,542
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PRO FORMA ADJUSTMENTS-PRO FORMA COMBINED CONDENSED STATEMENTS OF OPERATIONS-
(1) Pro forma entry to adjust actual depreciation and depletion expense on
oil and gas properties for Search to the depreciation and depletion
calculated on a consolidated basis.
(2) Pro forma entry to reflect the interest expense on the notes payable
issued in the roll-up of Search's managed limited partnerships.
(3) Pro forma entry to reflect interest income earned on restricted cash,
as well as interest expense incurred on the $15,000,000 8% senior
convertible note facility.
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(c.) Exhibits.
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Exhibit
Number Description
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2.1 Amended and Restated Agreement and Plan of Merger among Harken
Energy Corporation, Search Acquisition Corp. and Search
Exploration, Inc. dated as of November 8, 1994 and as amended
on March 27, 1995 (incorporated by reference as Exhibit 2.1 to
Harken's Registration Statement on Form S-4 (File No. 33-58265)).
10.1 Form of Harken Warrant (incorporated by reference as Exhibit
10.2 of Harken's Registration Statement on Form S-4 (File No.
33-58265)).
23.1 Consent of Hein & Associates LLP
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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.
Harken Energy Corporation
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(Registrant)
Date: August 3, 1995 /s/ Bruce N. Huff
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Bruce N. Huff, Senior Vice President
and Chief Financial Officer
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INDEX TO EXHIBITS
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SEQUENTIALLY
EXHIBIT NUMBERED
NUMBER DESCRIPTION PAGE
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23.1 Consent of Hein + Associates LLP.
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INDEPENDENT AUDITOR'S CONSENT
We consent to the incorporation by reference in the Form 8-K/A
(Amendment No. 1) of Harken Energy Corporation of our report dated
February 10, 1995, accompanying the consolidated financial statements
of Search Exploration, Inc. incorporated by reference in such filing.
/s/ HEIN + ASSOCIATES LLP
HEIN + ASSOCIATES LLP
August 2, 1995
Dallas, Texas
