<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For quarterly period ended JUNE 30, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from __________ to __________
Commission File Number 0-10955
CODA ENERGY, INC.
(Exact name of registrant as specified in its charter)
Delaware 75-1842480
(State of incorporation) (IRS Employer Identification No.)
5735 Pineland Dr., Suite 300, Dallas, Texas 75231
(Address of principal executive offices) (Zip Code)
Registrant's Telephone Number, Including Area Code: (214) 692-1800
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. [ ] Yes [X] No
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Common Stock, $.01 Par Value 913,611 Shares
Outstanding at August 1, 1997
<PAGE>
PART I - FINANCIAL INFORMATION
FINANCIAL STATEMENTS
CODA ENERGY, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
ASSETS
------
(in thousands)
<TABLE>
<CAPTION>
June 30,
December 31, 1997
1996 (Unaudited)
---------------------------
<S> <C> <C>
Current Assets:
Cash and cash equivalents $ 7,994 $ 6,296
Accounts receivable - revenue 14,432 9,539
Accounts receivable - joint interest
and other 1,673 2,099
Other current assets 1,046 877
-------- --------
25,145 18,811
-------- --------
Oil and gas properties (full cost
accounting method):
Proved oil and gas properties 249,693 268,610
Unproved oil and gas properties 1,000 1,000
Less accumulated depletion,
depreciation and amortization (20,757) (32,312)
-------- --------
229,936 237,298
-------- --------
Gas plants and gathering systems 34,258 36,249
Less accumulated depreciation (2,305) (3,647)
-------- --------
31,953 32,602
-------- --------
Other properties and assets, net 8,536 8,732
-------- --------
$295,570 $297,443
======== ========
</TABLE>
See Notes to Consolidated Financial Statements
1
<PAGE>
CODA ENERGY, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
LIABILITIES AND SHAREHOLDERS' EQUITY
------------------------------------
(dollars in thousands)
<TABLE>
<CAPTION>
June 30,
December 31, 1997
1996 (Unaudited)
---------------------------
<S> <C> <C>
Current liabilities:
Current maturities of long-term
debt and notes payable $ 120 $ ---
Accounts payable - trade 8,934 7,448
Accounts payable - revenue and other 5,210 4,271
Accrued interest 3,366 3,113
Income taxes payable 579 391
-------- --------
18,209 15,223
-------- --------
Long-term debt - less current maturities 64,966 68,100
-------- --------
10 1/2% Senior Subordinated Notes 110,000 110,000
-------- --------
Deferred income taxes 37,061 37,728
-------- --------
Commitments and contingent liabilities
15% Cumulative redeemable preferred
stock, 40,000 shares of $.01 par
value authorized; 20,000 shares issued
and outstanding; liquidation preference
of $24,476 at June 30, 1997, including
dividends in arrears 20,000 20,000
-------- --------
Common stockholders' equity of
management, subject to put and call
rights, 13,611 shares of $.01 par
value common stock issued and
outstanding 4,560 4,560
Less related notes receivable (937) (937)
-------- --------
3,623 3,623
-------- --------
Other common stockholders' equity:
Common stock, 1 million shares, $.01
par value, authorized, 900,000
shares issued and outstanding 9 9
Additional paid-in capital 89,991 89,991
Retained deficit (48,289) (47,231)
-------- --------
41,711 42,769
-------- --------
$295,570 $297,443
======== ========
</TABLE>
See Notes to Consolidated Financial Statements
2
<PAGE>
CODA ENERGY, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, in thousands)
<TABLE>
<CAPTION>
Predecessor | Successor
-----------------|---------------------------------------------------------------------------------
| Three Months Pro Forma Six Three Months Six Months
47 Days Ended | 134 Days Ended Ended Months Ended Ended Ended
February 16, | June 30, June 30, June 30, June 30, June 30,
1996 | 1996 1996 1996 1997 1997
------------ | --------------- ------------ ------------- ------------ ----------
<S> <C> | <C> <C> <C> <C> <C>
Revenues: |
Oil and gas sales $ 8,079 | $ 28,403 $19,439 $36,482 $ 17,737 $37,305
Gas gathering and |
processing 5,322 | 15,338 10,539 20,660 9,546 21,957
Other income 168 | 668 467 836 243 614
-------- | --------- ------- ------- -------- -------
13,569 | 44,409 30,445 57,978 27,526 59,876
-------- | --------- ------- ------- -------- -------
Costs and expenses: |
Oil and gas production 3,607 | 12,101 8,216 15,708 8,438 17,010
Gas gathering and |
processing 4,567 | 12,628 8,740 17,195 8,272 18,958
Depletion, |
depreciation and |
amortization 2,583 | 10,510 7,012 13,909 6,821 13,440
|
General and |
administrative 320 | 876 524 1,196 232 430
Interest 1,102 | 6,400 4,313 8,613 4,092 8,077
Stock option |
compensation 3,199 | --- --- --- --- ---
Writedown of oil and |
gas properties --- | 83,305 --- --- --- ---
-------- | --------- ------- ------- -------- -------
15,378 | 125,820 28,805 56,621 27,855 57,915
-------- | --------- ------- ------- -------- -------
|
Income (loss) before |
income taxes (1,809) | (81,411) 1,640 1,357 (329) 1,961
|
Income tax expense |
(benefit) (511) | (29,222) 693 690 (26) 903
-------- | --------- ------- ------- -------- -------
|
Net income (loss) (1,298) | (52,189) 947 667 (303) 1,058
|
Preferred stock dividend |
requirements --- | 1,106 745 1,500 885 1,738
-------- | --------- ------- ------- -------- -------
|
Net income (loss) |
available for common |
stockholders ($1,298) | ($53,295) $ 202 ($ 833) ($1,188) ($680)
======== | ========= ======= ======= ======== =======
</TABLE>
See Notes to Consolidated Financial Statements
3
<PAGE>
CODA ENERGY, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited, in thousands)
<TABLE>
<CAPTION>
Predecessor | Successor
---------------|-----------------------
|
47 Days | 134 Days Six Months
Ended | Ended Ended
February 16, | June 30, June 30,
1996 | 1996 1997
------------ | ---------- -----------
<S> <C> | <C> <C>
Cash flows from operating activities: |
Net income (loss) ($1,298) | ($52,189) $ 1,058
Adjustments to reconcile net income |
(loss) to net cash provided by |
operating activities: |
Depletion, depreciation and |
amortization 2,583 | 10,510 13,440
Writedown of oil and gas |
properties --- | 83,305 ---
Deferred income tax expense |
(benefit) (511) | (29,443) 667
Stock option compensation 3,199 | --- ---
Other 6 | (107) (4)
Effect of changes in: |
Accounts receivable 3,386 | (2,837) 4,467
Other current assets (63) | 273 169
Accounts payable and other |
current liabilities (4,166) | 7,468 (2,866)
-------- | --------- --------
Net cash provided by |
operating activities 3,136 | 16,980 16,931
-------- | --------- --------
|
Cash flows from investing activities: |
Additions to oil and gas properties (1,717) | (4,525) (22,389)
Proceeds from sale of assets 110 | 623 3,477
Purchase of Coda by JEDI, net of |
$5,740 cash acquired --- | (174,373) ---
Gas plant and gathering systems and |
other property additions (114) | (176) (2,086)
Loan to stockholder --- | --- (450)
Payments received on amounts due |
from stockholders 130 | 124 ---
-------- | --------- --------
Net cash used by |
investing activities (1,591) | (178,327) (21,448)
-------- | --------- --------
|
Cash flows from financing activities: |
Proceeds from bank borrowings --- | --- 15,000
Proceeds from issuance of |
subordinated debt --- | 210,000 ---
Proceeds from issuance of common and |
preferred stock --- | 110,026 ---
Repayment of bank borrowings and |
subordinated debt (19) | (149,850) (11,986)
Financing costs (390) | (716) (195)
-------- | --------- --------
Net cash provided (used) |
by financing activities (409) | 169,460 2,819
-------- | --------- --------
|
Increase (decrease) in cash 1,136 | 8,113 (1,698)
Cash at beginning of period 4,604 | --- 7,994
-------- | --------- --------
Cash at end of period $ 5,740 | $ 8,113 $ 6,296
======== | ========= ========
|
Supplemental cash flow information: |
Interest paid $ 1,544 | $ 2,863 $ 8,330
======== | ========= ========
Income taxes paid $ --- | $ 120 $ 424
======== | ========= ========
</TABLE>
See Notes to Consolidated Financial Statements
4
<PAGE>
CODA ENERGY, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
1. THE MERGER
On February 16, 1996, pursuant to an Agreement and Plan of Merger, Coda
Energy, Inc. ("Coda"), was acquired by Joint Energy Development Investments
Limited Partnership ("JEDI"), which is an affiliate of Enron Capital & Trade
Resources Corp. ("ECT") (the "Merger"). Coda, together with its subsidiaries,
prior to and including February 16, 1996 is referred to herein as the
Predecessor and after such date as the Successor and collectively, for both
periods, the Company. In conjunction with the Merger, JEDI entered into certain
agreements with members of the Company's management (the "Management Group"),
providing for a continuing role of management in the Company after the Merger.
Following consummation of the Merger, the Management Group owns approximately 5%
of Coda's common stock on a fully-diluted basis. JEDI owns the remaining 95%.
The Merger has been accounted for using the purchase method of accounting.
As such, JEDI's cost of acquiring Coda has been allocated to the assets and
liabilities acquired based on estimated fair values. As a result, the Company's
financial position and operating results subsequent to the date of the Merger
reflect a new basis of accounting and are not comparable to prior periods.
The allocation of JEDI's purchase price to the assets and liabilities of
Coda resulted in a significant increase in the carrying value of the Company's
oil and gas properties. Under the full cost method of accounting, the carrying
value of oil and gas properties (net of related deferred taxes) is generally not
permitted to exceed the sum of the present value (10% discount rate) of
estimated future net cash flows (after tax) from proved reserves, based on
current prices and costs, plus the lower of cost or estimated fair value of
unproved properties (the "cost center ceiling"). Based upon the allocation of
JEDI's purchase price and estimated proved reserves and product prices in effect
at the date of the Merger, the purchase price allocated to oil and gas
properties was in excess of the cost center ceiling by approximately $83.3
million ($53.3 million net of related deferred taxes). The resulting writedown
was a non-cash charge and was included in the results of operations for the 134-
day period ended June 30, 1996.
2. ACCOUNTING AND REPORTING POLICIES
The consolidated financial statements include the accounts of Coda and its
majority-owned subsidiaries. All significant intercompany balances and
transactions have been eliminated in consolidation. Certain reclassifications
have been made to prior years' amounts to conform to the current year
presentation.
The accompanying consolidated financial statements, which should be read in
conjunction with the audited consolidated financial statements for the 319-day
period ended December 31, 1996, reflect
5
<PAGE>
all adjustments (consisting only of normal recurring accruals) which are, in the
opinion of management, necessary to present fairly the financial position as of
June 30, 1997, and the results of operations and cash flows for the 47 day
period ended February 16, 1996, the 134 day period ended June 30, 1996 and the
six months ended June 30, 1997. The results for the period ended June 30, 1997,
are not necessarily indicative of results for a full year.
Fees from overhead charges billed to working interest owners, including the
Company, of $848,000, $2.5 million and $3.5 million for the 47 day period ended
February 16, 1996, the 134 day period ended June 30, 1996 and the six months
ended June 30, 1997, respectively, have been classified as a reduction of
general and administrative expenses in the accompanying consolidated statements
of operations.
3. PRO FORMA INFORMATION
The pro forma statement of operations information was prepared as if the
Merger and the sale of the 10 1/2% Senior Subordinated Notes (the "Notes") had
occurred on January 1, 1996. The pro forma information does not purport to
represent the results of operations which would have occurred had such
transactions been consummated on January 1, 1996 or for any future period. The
pro forma information was prepared by adjusting the 1996 periods: (i) to adjust
depletion, depreciation, and amortization to reflect JEDI's purchase price
allocated to property and equipment, (ii) to adjust interest expense to give
effect to the net reduction of approximately $37.0 million under the Company's
credit facility and repayment of a note payable to an officer of the Company,
partially offset by an increase in the interest rate on borrowings under the new
credit facility of .25%, (iii) to record interest on the Notes at an interest
rate of 10 1/2%, (iv) to record amortization of the issuance cost of the Notes
over the term such debt is expected to be outstanding (10 years), (v) to adjust
the writedown of oil and gas properties and stock option compensation to
eliminate these non-recurring charges related to the Merger, (vi) to adjust the
provision for income taxes for the change in financial taxable income resulting
from the above adjustments, and (vii) to record the cumulative dividend
requirements of the redeemable preferred stock issued to JEDI.
4. ACQUISITIONS
In February 1997, the Company purchased 123 producing oil and gas
properties from J. M. Huber Corporation for an aggregate purchase price of
approximately $13.5 million, of which $6.5 million was financed under the
Company's credit agreement. The properties are predominately located in Texas,
Oklahoma and Arkansas. The Company estimates the properties have proved reserves
of approximately 1.6 million barrels of oil and 15.1 Bcf of gas as of the
effective date, January 1, 1997.
5. LONG-TERM DEBT
On February 14, 1996, the Company entered into a credit agreement with
NationsBank of Texas, N.A. ("NationsBank"), as lender and as agent, and
additional lenders named therein (as amended, the "Credit Agreement") which
provides for a revolving credit facility in an amount up to $250.0 million.
6
<PAGE>
Pursuant to the terms of the Credit Agreement, the semiannual borrowing base
redetermination as of April 1, 1997, resulted in an increase of the Company's
borrowing base from $115 million to $120 million. The next redetermination is
scheduled for October 31, 1997. At June 30, 1997, $68.0 million was outstanding
under the Credit Agreement and $52.0 million was available for borrowing
thereunder. On March 31, 1997, the Company repaid in full (principal balance of
$466,000) it's note payable to NationsBank that was due January 2, 1998.
6. 10 1/2% SENIOR SUBORDINATED NOTES
On March 18, 1996, the Company completed the sale of the Notes which bear
interest at an annual rate of 10 1/2% payable semiannually in arrears on April 1
and October 1 of each year. The Notes are general, unsecured obligations of the
Company, are subordinated in right of payment to all Senior Debt (as defined in
the indenture governing the Notes (the "Indenture") of Coda, and are senior in
right of payment to all future subordinated debt of the Company. The claims of
the holders of the Notes are subordinated to Senior Debt, which, as of June 30,
1997, was $68.1 million.
The Notes were issued pursuant to the Indenture, which contains certain
covenants that, among other things, limit the ability of Coda and its Restricted
Subsidiaries (as defined in the Indenture) to incur additional indebtedness and
issue Disqualified Stock (as defined in the Indenture), pay dividends, make
distributions, make investments, make certain other restricted payments, enter
into certain transactions with affiliates, dispose of certain assets, incur
liens securing pari passu or subordinated indebtedness of Coda and engage in
mergers and consolidations.
Coda's payment obligations under the Notes are fully, unconditionally and
jointly and severally guaranteed on a senior subordinated basis by all of Coda's
current subsidiaries and future Restricted Subsidiaries. Such guarantees are
subordinated to the guarantees of Senior Debt issued by the Guarantors (as
defined in the Indenture) under the Credit Agreement and to other guarantees of
Senior Debt issued in the future. All of Coda's current subsidiaries are wholly
owned. There are currently no restrictions on distributions from the Guarantors
to Coda.
Separate financial statements and other disclosures concerning the
Guarantors are not presented because management has determined they are not
material to investors. The combined condensed financial information of the
Company's current subsidiaries, the Guarantors, is as follows:
7
<PAGE>
<TABLE>
<CAPTION>
December 31, June 30,
1996 1997
------------ ----------
(Unaudited)
<S> <C> <C>
Current assets $ 7,745 $ 3,991
Oil and gas properties, net 50,176 50,776
Gas plants and gathering systems, net 31,617 32,266
Other properties and assets, net 1,113 875
------- -------
Total assets $90,651 $87,908
======= =======
Current liabilities $ 8,321 $ 6,823
Intercompany payables 33,551 28,536
Deferred income taxes 16,191 17,553
Stockholder's equity 32,588 34,996
------- -------
Total liabilities and
stockholder's equity $90,651 $87,908
======= =======
</TABLE>
<TABLE>
<CAPTION>
Predecessor | Successor
---------------|-----------------------
|
47 Days | 134 Days Six Months
Ended | Ended Ended
February 16, | June 30, June 30,
1996 | 1996 1997
------------ | ---------- -----------
(Unaudited) | (Unaudited) (Unaudited)
<S> <C> | <C> <C>
Revenues: |
Oil and gas sales $2,529 | $10,257 $12,144
Gas gathering and processing 5,322 | 15,338 21,957
Other income 2 | 100 24
------ | ------- -------
7,853 | 25,695 34,125
|
Costs and expenses: |
Oil and gas production 843 | 2,868 3,742
Gas gathering and processing 4,567 | 12,628 18,958
Depletion, depreciation and |
amortization 1,039 | 4,152 4,982
General and administrative 435 | 1,401 1,484
Interest 460 | 1,216 953
Writedown of oil and gas |
properties --- | 19,159 ---
------ | ------- -------
7,344 | 41,424 30,119
------ | ------- -------
Income (loss) before income taxes 509 | (15,729) 4,006
Income tax expense (benefit) 277 | (5,607) 1,598
------ | ------- -------
Net income (loss) $ 232 | ($10,122) $ 2,408
====== | ======== =======
</TABLE>
8
<PAGE>
7. PREFERRED STOCK
Under Coda's Restated Certificate of Incorporation, the Board of Directors
is authorized to issue up to 40,000 shares of preferred stock, par value $0.01
per share. All 40,000 shares of preferred stock are designated as "15%
Cumulative Preferred Stock" (the "Preferred Stock"). The holders of each share
of Preferred Stock are entitled to receive, when and as declared by the Board of
Directors, cumulative preferential dividends, at the rate of $150.00 per share
per annum. There are currently 20,000 shares of Preferred Stock issued and
outstanding. Shares of Preferred Stock in excess of such 20,000 shares are
issuable only for the purpose of paying dividends on the Preferred Stock. As of
June 30, 1997, the Preferred Stock had accumulated approximately $4.5 million in
preferred dividends which had not been declared by the Board of Directors.
9
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
-------------------------------------------------
CONDITION AND RESULTS OF OPERATIONS
-----------------------------------
The Company is an independent energy company principally engaged in the
acquisition and exploitation of producing oil and natural gas properties. The
Company also owns and operates natural gas processing and liquids extraction
facilities and natural gas gathering systems. Coda seeks to acquire properties
whose predominant economic value is attributable to proved producing reserves
and to enhance that value through control of operations, reduction of costs and
development of properties.
The Company's principal strategy is to increase oil and natural gas
reserves and cash flow by selectively acquiring and exploiting producing oil and
natural gas properties, especially those properties with enhanced recovery and
other lower risk development potential. Coda's exploitation efforts include,
where appropriate, the drilling of lower risk development wells, the initiation
of secondary recovery projects, the renegotiation of marketing agreements and
the reduction of drilling, completion and lifting costs. Cost savings may be
principally achieved through reductions in field staff and the more effective
utilization of field facilities and equipment by virtue of geographic
concentration.
The Company expects to continue its efforts to acquire additional oil and
natural gas properties. Future acquisitions, if any, would necessitate, in most
cases, borrowing additional funds under the Company's credit facility. The
ability to borrow such funds is dependent upon the Company's borrowing base from
time to time and the effect upon the borrowing base of the properties to be
acquired.
On February 16, 1996, pursuant to an Agreement and Plan of Merger, Coda was
acquired by Joint Energy Development Investments Limited Partnership ("JEDI"),
which is an affiliate of Enron Capital & Trade Resources Corp. ("ECT") (the
"Merger"). Coda, together with its subsidiaries, prior to and including February
16, 1996 is referred to herein as the Predecessor and after such date as the
Successor and collectively, for both periods, the Company. The Merger has been
accounted for using the purchase method of accounting. As such, JEDI's cost of
acquiring Coda has been allocated to the assets and liabilities acquired based
on estimated fair values. As a result, the Company's financial position and
operating results subsequent to the date of the Merger reflect a new basis of
accounting and are not comparable to prior periods.
FORWARD-LOOKING STATEMENTS
All statements in this document concerning the Company other than purely
historical information (collectively "Forward-Looking Statements") reflect the
current expectation of management and are based on the Company's historical
operating trends, estimates of proved reserves and other information currently
available to management. These statements assume, among other things, (i) that
no significant changes will occur in the operating environment for the Company's
oil and gas properties, gas plants and gathering systems and (ii) that there
will be no material acquisitions or
10
<PAGE>
divestitures. The Company cautions that the Forward-Looking Statements are
subject to all the risks and uncertainties incident to the acquisition,
development and marketing of, and exploration for, oil and gas reserves. These
risks include, but are not limited to, commodity price risk, environmental risk,
drilling risk, reserve, operations and production risks, regulatory risks and
counterparty risk. Many of these risks are described elsewhere herein. The
Company may make material acquisitions or dispositions, enter into new or
terminate existing oil and gas sales or hedging contracts, or enter into
financing transactions. None of these can be predicted with any certainty and,
accordingly, are not taken into consideration in the Forward-Looking Statements
made herein. For all of the foregoing reasons, actual results may vary
materially from the Forward-Looking Statements and there is no assurance that
the assumptions used are necessarily the most likely.
11
<PAGE>
RESULTS OF OPERATIONS
The following table sets forth certain unaudited operating data regarding
the production and sales volumes, average sales prices, and costs associated
with the Company's oil and gas operations and gas gathering and processing
operations for the periods indicated.
<TABLE>
<CAPTION>
Predecessor | Successor
-----------------|---------------------------------------------------------------------------------
| Three Months Pro Forma Six Three Months Six Months
47 Days Ended | 134 Days Ended Ended Months Ended Ended Ended
February 16, | June 30, June 30, June 30, June 30, June 30,
1996 | 1996 1996 1996 1997 1997
------------ | --------------- ------------ ------------- ------------ ----------
<S> <C> | <C> <C> <C> <C> <C>
OIL AND GAS OPERATING DATA: |
Net production: |
Oil (Mbbls) 408 | 1,307 880 1,715 824 1,632
Gas (Mmcf) 500 | 1,378 866 1,878 1,173 2,262
|
Average sales price: |
Oil (per Bbl) $ 17.57 | $ 19.54 $ 19.86 $ 19.07 $ 18.72 $ 19.62
Gas (per Mcf) $ 1.82 | $ 2.08 $ 2.27 $ 2.01 $ 1.97 $ 2.34
|
Average production cost $ 7.33 | $ 7.87 $ 8.02 $ 7.75 $ 8.28 $ 8.47
per BOE |
|
GAS GATHERING AND |
PROCESSING OPERATING DATA: |
|
Sales: |
Gas sales (MMBTU) 1,555 | 4,479 3,049 6,034 3,204 6,308
Gas sales average price $ 2.24 | $ 2.20 $ 2.26 $ 2.21 $ 2.05 $ 2.46
Natural gas liquids |
sales (M gallons) 5,868 | 16,862 11,375 22,730 9,863 19,200
Natural gas liquids |
average price $0.3173 | $0.3248 $0.3216 $0.3228 $0.3015 $0.3357
|
Costs and expenses (in |
thousands): |
Gas purchases $ 3,760 | $11,384 $ 7,994 $15,444 $ 7,421 $16,793
Plant operating expenses $ 506 | $ 1,464 $ 965 $ 1,970 $ 1,031 $ 2,165
</TABLE>
Comparison of the six months ended June 30, 1996 (pro forma) and 1997
(historical)
The unaudited pro forma combined information was prepared as if the Merger
and the issuance of $110.0 million of 10 1/2% Senior Subordinated Notes (the
"Notes") had occurred on January 1, 1996. The unaudited pro forma information
was prepared by combining the two 1996 periods and giving effect to adjustments
affecting (i) depletion, depreciation and amortization, (ii) interest expense,
(iii) income taxes and (iv) certain other costs resulting from the Merger as
more fully
12
<PAGE>
outlined in the Notes to Consolidated Financial Statements. The comparisons
below compare the unaudited pro forma information for the six months ended June
30, 1996 to unaudited historical information for the six months ended June 30,
1997. Unless otherwise indicated, the variation and trend analysis set forth
below in comparing the six months ended June 30, 1996 and 1997 is comparable to
the analysis that would result from comparing the quarters ended June 30, 1996
and 1997.
Oil and gas sales for the six months ended June 30, 1997, increased 2% to
approximately $37.3 million from approximately $36.5 million in the comparable
period in 1996 primarily due to an increase of $2.55 per barrel and $.33 per Mcf
in the average sales price of oil and gas, respectively, partially offset by a
5% decrease in oil production. The decrease in oil production is primarily a
result of natural declines in production partially offset by production from
acquisitions in December 1996 and February 1997. The Company also experienced a
20% increase in gas volumes as a result of the acquisition of oil and gas
properties in February 1997 and favorable drilling results in 1996 and 1997.
During the six months ended June 30, 1997, 86% of oil and gas sales revenues
were attributable to oil production.
Oil and gas sales for the quarter ended June 30, 1997 decreased 9% to
approximately $17.7 million from approximately $19.4 million in the comparable
period in 1996 primarily due to a decrease of $1.14 per barrel and $.30 per Mcf
in the average sales price of oil and gas, respectively, and by a 6% decrease in
oil production. The decrease in oil production results from natural production
declines which were partially offset by production from acquisitions in December
1996 and February 1997. The Company also experienced a 35% increase in gas
volumes as a result of the acquisition of oil and gas properties in February
1997 and favorable drilling results in 1996 and 1997.
Oil and gas sales for the quarter ended June 30, 1997 decreased
approximately 9% to $17.7 million from approximately $20.0 million for the
quarter ended March 31, 1997 primarily due to a price decrease of $1.82 per
barrel and $.76 per Mcf in the average sales price of oil and gas, respectively.
Oil and gas prices remain unpredictable. See "- Changes in Prices and Hedging
Activities" below.
Gas gathering and processing revenues for the six months ended June 30,
1997 increased 6% to approximately $22.0 million from approximately $20.7
million in the comparable period in 1996 primarily due to an 11% and a 4%
increase in the average sales price for gas and natural gas liquids,
respectively. This increase was partially offset by a 16% decrease in natural
gas liquids volumes due primarily to natural production declines.
Gas gathering and processing revenues for the quarter ended June 30, 1997
decreased 9% to approximately $9.5 million from approximately $10.5 million in
the comparable period in 1996 primarily due to a 9% and a 6% decrease in the
average sales price for gas and natural gas liquids, respectively. This decrease
was compounded by a 13% decrease in natural gas liquids sales volumes due
primarily to natural production declines.
13
<PAGE>
Gas gathering and processing revenues for the quarter ended June 30, 1997
decreased 23% to approximately $9.5 million from approximately $12.4 million for
the quarter ended March 31, 1997 primarily due to a 29% and a 19% decrease in
the average sales price for gas and natural gas liquids, respectively. This
decrease was partially offset by a 6% increase in natural gas liquids sales
volumes.
Gas gathering and processing expenses for the six months ended June 30,
1997 increased 10% to approximately $19.0 million from approximately $17.2
million in the comparable period in 1996 due primarily to an increase in the
purchase price paid to producers. Gas gathering and processing expenses usually
fluctuate in ratio with gas gathering and processing revenues.
Oil and gas production expenses (including production taxes) for the six
months ended June 30, 1997 increased 8% to approximately $17.0 million from
approximately $15.7 million for the same period in 1996, reflecting the effects
of the properties acquired in 1996 and 1997 and from new wells drilled. Oil and
gas production expenses for the six months ended June 30, 1997 were $8.47 per
BOE and are expected to remain near this level for the remainder of the year.
Depletion, depreciation and amortization expense for the six months ended
June 30, 1997, decreased 3% to approximately $13.4 million from approximately
$13.9 million for the pro forma period in 1996 reflecting the effect on
depletion, depreciation and amortization rates of upward reserve revisions at
December 31, 1996 and acquisitions in December 1996 and February 1997. Oil and
gas depletion, depreciation and amortization expense decreased from $5.94 per
BOE for the six months ended June 30, 1996, to $5.75 per BOE for the six months
ended June 30, 1997. The Company anticipates that the depletion, depreciation
and amortization rate per BOE will be approximately $5.75 for 1997, absent
significant additional acquisitions or reserve revisions.
General and administrative expenses for the six months ended June 30, 1997
decreased 64% to approximately $430,000 from approximately $1.2 million for the
same period in 1996. This decrease is primarily due to an accrual for bonuses of
$378,000 in 1996 but not in 1997. Also contributing to the decrease were
additional overhead charges of $112,000 billed to working interest owners on the
properties acquired in December 1996 and February 1997. The Company expects that
general and administrative expenses for the year ended December 31, 1997 will be
near 1996 levels, absent significant additional acquisitions.
Interest expense for the six months ended June 30, 1997 decreased 6% to
approximately $8.1 million from approximately $8.6 million for the comparable
period in 1996, primarily due to decreases in outstanding debt levels as a
result of utilizing available cash flow to reduce amounts outstanding under the
Company's credit facility.
Net income for the six months ended June 30, 1997, was approximately $1.1
million compared to approximately $667,000 for the comparable period in 1996.
This increase resulted primarily from higher oil and gas prices and decreases in
general and administrative expenses. Net loss for the quarter ended June 30,
1997 was $303,000 compared to net income for the quarter ended March 31,
14
<PAGE>
1997 of $1.4 million. This decrease resulted primarily from a drop in oil and
gas prices during the second quarter of 1997.
CHANGES IN PRICES AND HEDGING ACTIVITIES
Annual average oil and natural gas prices have fluctuated significantly
over the past three years. The Company's weighted average oil price per barrel
during 1996 and at December 31, 1996, was $20.22 and $24.88, respectively. For
the six months ended June 30, 1997, the Company received an average of $1.75 per
barrel less (including an oil hedging price decrease of $.80 per barrel) and
$.09 per Mcf more for its oil and natural gas sales, respectively, than the
average NYMEX prices for the same period. On July 31, 1997, the NYMEX closing
price for the near month for oil and natural gas was $20.14 per barrel and $2.18
per Mcf, respectively.
In an effort to reduce the effects of the volatility of the price of oil
and natural gas on the Company's operations, management has adopted a policy of
hedging oil and natural gas prices on a portion of the Company's production
through the use of commodity futures, options, and swap agreements whenever
market prices are in excess of the prices anticipated in the Company's operating
budget and profit plan. While the use of these hedging arrangements limits the
downside risk of adverse price movements, it may also limit future gains from
favorable movements. All hedging is accomplished pursuant to exchange-traded
contract or master swap agreements based upon standard forms. The Company
addresses market risk by selecting instruments whose value fluctuations
correlate strongly with the underlying commodity being hedged. Credit risk
related to hedging activities, which is minimal, is managed by requiring minimum
credit standards for courterparties, periodic settlements and mark-to-market
valuations. Under the standard form swap and option agreements in use by the
Company, the Company's revenues will be limited when the NYMEX price exceeds the
strike price. The total potential reduction in revenues is equal to the
difference between the strike prices and the NYMEX price for the production
month hedged multiplied by the number of barrels swapped. To the extent this
amount exceeds the credit limit established by the counterparty, the Company may
be required to utilize cash to fund a margin account. The Company has not
historically been required to provide any significant amount of collateral in
connection with its hedging activities.
The Company has sold swaps to hedge 315,000 barrels of oil and 60,000
barrels of oil at a weighted average NYMEX price of $19.24 and $19.41 per barrel
for the six months ending December 31, 1997 and year ending December 31, 1998,
respectively, under various transactions entered into as of June 30, 1997. As of
June 30, 1997 the Company had open positions for sold call options covering
25,000 barrels of oil per month at an option price of $20.00 per barrel for July
and August 1997. In connection with a swap beginning January 1, 1997 covering
15,000 barrels per month at a strike price of $19.00, which expires December 31,
1997, the Company granted the counterparty a one day option at the expiration of
the swap to extend the swap under the same terms for an additional twelve
months.
15
<PAGE>
During the 47 day period ended February 16, 1996, the 134 day period ended
June 30, 1996 and the six months ended June 30, 1997 the Company's oil revenues
were decreased by $14,000, $1.1 million and $1.3 million, respectively, as a
result of hedging transactions.
LIQUIDITY AND CAPITAL RESOURCES
At June 30, 1997, the Company had cash and cash equivalents of
approximately $6.3 million and working capital of approximately $3.6 million.
Cash provided by operating activities for the six months ended June 30, 1997
decreased to approximately $16.9 million compared to $20.1 million for the
comparable period in 1996 due primarily to changes in working capital items. The
changes in working capital items account for approximately $2.3 million of the
decrease in cash provided by operations. As a result of issuing the Notes in
March 1996, accrued interest increased approximately $3.1 million which resulted
in an increase to cash provided by operations in 1996 that did not recur in
1997. The other changes in working capital items are primarily oil and gas price
related. Cash provided by operating activities before changes in working capital
items for the six months ended June 30, 1997 decreased $844,000 to approximately
$15.2 million from approximately $16.1 million from the comparable period in
1996 due to a decrease in margins on oil and gas operations and gas gathering
and processing operations and higher interest expense related to the Notes
partially offset by lower general and administrative expenses. Excluding the
impact of the Merger, cash flows used in investing activities increased to $21.4
million for the six months ended June 30, 1997 from $5.5 million for the
comparable period in 1996, primarily as a result of the acquisition in February
1997 of oil and gas properties for $13.5 million. Cash flows provided by
financing activities decreased from $169.1 million for the six months ended June
30, 1996 to $2.8 million for the comparable period in 1997, primarily due to
financing transactions related to the Merger.
The Company has two principal operating sources of cash: (i) net oil and
gas sales from its oil and gas properties and (ii) net margins earned from gas
gathering and processing operations. The Company expects to continue its efforts
to acquire additional oil and gas properties. Future acquisitions, if any, would
necessitate, in most cases, borrowing additional funds under the Company's
credit facility. The ability to borrow such funds is dependent upon the
Company's borrowing base from time to time and the effect upon the borrowing
base of the properties to be acquired.
The Company from time to time entertains bids for selected portions of its
existing oil and natural gas properties which it believes are no longer suitable
for its business strategy. Sales of properties in the past three years have not
been material, and no substantial sales of properties are currently under
negotiation.
The Company has development drilling programs designed for all its major
operating areas. The Company has budgeted capital spending of between $15
million and $20 million in 1997, excluding property acquisitions, but is not
contractually committed to expend these funds. During the first six months of
1997, the Company incurred approximately $7.4 million of these costs. In
addition, the
16
<PAGE>
Company is continuing to evaluate oil and natural gas properties for future
acquisitions. As a result of being 95% owned by JEDI (on a fully diluted basis),
the Company does not expect to utilize the public equity market to finance
acquisitions in the near term. Accordingly, any material expenditures in
connection with acquisitions would require borrowing under the Company's credit
facility or from other sources. There can be no assurance that such funds will
be available to the Company. Furthermore, the Company's ability to borrow in the
future is subject to restrictions imposed by the Company's credit facility and
the indenture governing the Notes (the "Indenture").
The Merger
The Company incurred substantial indebtedness in connection with the Merger
and is highly leveraged. As of June 30, 1997, the Company had total indebtedness
of approximately $178.1 million and common stockholders' equity of approximately
$46.4 million. Based upon the Company's current level of operations and
anticipated growth, management of the Company believes that available cash,
together with available borrowings under the Company's credit facility, will be
adequate to meet the Company's anticipated future requirements for working
capital, capital expenditures and scheduled payments of principal of, and
interest on, its indebtedness, including the Notes. There can be no assurance
that such anticipated growth will be realized, that the Company's business will
generate sufficient cash flow from operations or that future borrowings will be
available in an amount sufficient to enable the Company to service its
indebtedness, including the Notes, or make necessary capital expenditures. The
Company may find it necessary to refinance a portion of the principal amount of
the Notes at or prior to their maturity. However, there can be no assurance that
the Company will be able to obtain financing to complete a refinancing of the
Notes.
Credit Agreement
On February 14, 1996, the Company entered into a credit agreement with
NationsBank of Texas, N.A. ("NationsBank"), as lender and as agent, and
additional lenders named therein (as amended, the "Credit Agreement"). Pursuant
to the terms of the Credit Agreement, the semiannual borrowing base
redetermination as of April 1, 1997 resulted in an increase of the Company's
borrowing base from $115 million to $120 million. The next redetermination is
scheduled for October 31, 1997. At June 30, 1997, $68.0 million was outstanding
under the Credit Agreement and $52.0 million was available for borrowing
thereunder. On March 31, 1997, the Company repaid in full (principal balance of
$466,000) its note payable to NationsBank that was due January 2, 1998.
15% Cumulative Preferred Stock
The Company's Restated Certificate of Incorporation authorizes the issuance
of up to 40,000 shares of preferred stock par value, $0.01 per share, designated
as "15% Cumulative Preferred Stock" (the "Preferred Stock"). In conjunction with
the Merger, the Company issued 20,000 shares of Preferred Stock to JEDI for
$20.0 million in cash. Shares of Preferred Stock in excess of such 20,000 shares
are issuable only for the purpose of paying dividends on the Preferred Stock.
The holders of each share of Preferred Stock are entitled to receive, when and
as declared by the Board
17
<PAGE>
of Directors, cumulative preferential dividends at the rate of $150.00 per share
per annum. The payment of Preferred Stock dividends in cash is restricted by the
Credit Agreement and the Indenture. As of June 30, 1997, the Preferred Stock had
accumulated approximately $4.5 million in preferred dividends which had not been
declared by the Board of Directors.
18
<PAGE>
PART II - OTHER INFORMATION
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
--------------------------------
(A) Exhibits
3.1 Restated Certificate of Incorporation of Coda filed as Exhibit 3.1 to
the Company's Registration Statement on Form S-4 filed April 9, 1996
(Registration No 333-2375, the "1996 Form S-4") and incorporated by
reference herein.
3.2 Amended and Restated Bylaws of Coda filed as Exhibit 3.2 to the 1996
Form S-4 and incorporated by reference herein.
3.3 Certificate of Incorporation of Diamond Energy Operating Company, as
amended, filed as Exhibit 3.3 to the 1996 Form S-4 and incorporated by
reference herein.
3.4 Bylaws of Diamond Energy Operating Company, as amended, filed as
Exhibit 3.4 to the 1996 Form S-4 and incorporated by reference herein.
3.5 Articles of Incorporation of Taurus Energy Corp., as amended, filed as
Exhibit 3.5 to the 1996 Form S-4 and incorporated by reference herein.
3.6 Bylaws of Taurus Energy Corp., as amended, filed as Exhibit 3.6 to the
1996 Form S-4 and incorporated by reference herein.
3.7 Articles of Incorporation of Electra Resources, Inc. filed as Exhibit
3.7 to the 1996 Form S-4 and incorporated by reference herein.
3.8 Bylaws of Electra Resources, Inc. filed as Exhibit 3.8 to the 1996 Form
S-4 and incorporated by reference herein.
4.1 Indenture, dated as of March 18, 1996, among Coda, Coda's guarantor
subsidiaries, Diamond Energy Operating Company, Taurus Energy Corp. and
Electra Resources, Inc. (collectively, the "Guarantors"), and Texas
Commerce Bank National Association, as trustee, relating to
$110,000,000 aggregate principal amount of 10 1/2% Series A and Series
B Senior Subordinated Notes due 2006 filed as Exhibit 4.1 to the 1996
Form S-4 and incorporated by reference herein.
4.2 Registration Rights Agreement, dated as of March 18, 1996, among Coda,
the Guarantors and Goldman, Sachs, & Co., Chemical Securities, Inc.,
ECT Securities Corp. and NationsBanc Capital Markets, Inc.
(collectively, the "Initial Purchasers") filed as Exhibit 4.2 to the
1996 Form S-4 and incorporated by reference herein.
19
<PAGE>
4.3 Purchase Agreement, dated as of March 12, 1996, among Coda, the
Guarantors and the Initial Purchasers filed as Exhibit 4.3 to the 1996
Form S-4 and incorporated by reference herein.
4.4 Credit Agreement, dated February 14, 1996, among the Company,
individually and as agent, and additional lenders named therein, filed
as Exhibit 4.5 to the 1996 Form S-4 and incorporated by reference
herein.
4.5 Promissory Note dated February 14, 1996, in the original principal
amount of $87,500,000.00, executed by Coda, payable to NationsBank
filed as Exhibit 4.6 to the 1996 Form S-4 and incorporated by reference
herein.
4.6 Promissory Note dated February 14, 1996, in the original principal
amount of $37,500,000.00, executed by Coda, payable to Bank One, Texas,
N.A. filed as Exhibit 4.7 to the 1996 Form S-4 and incorporated by
reference herein.
4.7 Promissory Note dated February 14, 1996, in the original principal
amount of $75,000,000.00, executed by Coda, payable to Texas Commerce
Bank National Association filed as Exhibit 4.8 to the 1996 Form S-4 and
incorporated by reference herein.
4.8 Promissory Note dated February 14, 1996, in the original principal
amount of $50,000,000.00, executed by Coda, payable to the First
National Bank of Boston filed as Exhibit 4.9 to the 1996 Form S-4 and
incorporated by reference herein.
4.9 Specimen Certificate of Series B 10 1/2% Senior Subordinated Notes due
2006 (included in Exhibit 4.1 hereto), filed as Exhibit 4.11 to the
1996 Form S-4 and incorporated by reference herein.
4.10 First Supplement to Indenture dated as of April 25, 1996 filed as
Exhibit 4.12 the Company's Quarterly Report on Form 10-Q for the
quarterly period ended June 30, 1996 and incorporated by reference
herein amending the Indenture filed as Exhibit 4.1 above.
4.11 First Amendment to Credit Agreement, dated August 1, 1996, among the
Company, NationsBank and additional lenders named therein, filed as
Exhibit 4.13 to the Company's quarterly report on Form 10-Q for the
quarterly period ended September 30, 1996 (the "September 1996 10-Q")
and incorporated by reference herein amending the Credit Agreement
filed as Exhibit 4.4 above.
10.1/(2)/ Form of Indemnification Agreement entered into between Coda and
each of its directors and officers filed as Exhibit 10.1 to
Coda's Annual Report on Form 10-K for the fiscal year ended
December 31, 1994, and incorporated by reference herein.
20
<PAGE>
10.2/(2)/ List of directors and officers that have entered into
Indemnification Agreements with Coda filed as Exhibit 10.1 to the
Company's Quarterly Report on Form 10-Q for the quarterly period
ended September 30, 1995, (the "September 1995 10-Q") and
incorporated by reference herein.
10.3 Agreement and Plan of Merger, by and among Coda, JEDI and Coda
Acquisition, Inc. dated as of October 30, 1995 filed as Exhibit
2.1 to Coda's Current Report on Form 8-K dated October 30, 1995
(the "October 1995 8-K"), and incorporated by reference herein.
10.4 Agreement of Coda to provide schedules to the Agreement and Plan
of Merger (Exhibit 10.3) omitted pursuant to Item 6.01 (b)(2) of
Regulation S-K filed as Exhibit 2.2 to the September 1995 10-Q,
and incorporated by reference herein.
10.5 Amendment to Agreement and Plan of Merger dated as of December 22,
1995 filed as Exhibit 2.1 to Coda's Current Report on Form 8-K
dated December 22, 1995, and incorporated by reference herein.
10.6 Second Amendment to Agreement and Plan of Merger dated as of
January 10, 1996 filed as Exhibit 2.1 to Coda's Current Report on
Form 8-K dated January 10, 1996, and incorporated by reference
herein.
10.7 Agreement of Coda to provide schedules and exhibits to Second
Amendment to Agreement and Plan of Merger (Exhibit 10.6) and to
provide schedules to Amendment No. 1 to Subscription Agreement
(Exhibit 10.18) and Amendment No. 1 to Stockholders Agreement
(Exhibit 10.19) filed as Exhibit 99.4 to Coda's Current Report on
Form 8-K dated January 10, 1996, and incorporated by reference
herein.
10.8/(2)/ Stockholders Agreement dated October 30, 1995 filed as Exhibit
99.2 to the October 1995 8-K, and incorporated by reference
herein.
10.9/(2)/ Subscription Agreement among Coda Acquisition, Inc. and The
Management Investors dated October 30, 1995 filed as Exhibit 99.3
to the October 1995 8-K, and incorporated by reference herein.
10.10 Agreement of Coda to provide schedules to Stockholders Agreement
(Exhibit 10.8) and to Subscription Agreement (Exhibit 10.9) filed
as Exhibit 99.11 to the October 1995 8-K, and incorporated by
reference herein.
10.11/(2)/ Business Opportunity Agreement dated as of October 30, 1995 filed
as Exhibit 99.4 to the October 1995 8-K, and incorporated by
reference herein.
21
<PAGE>
10.12/(2)/ Executive Employment Agreement between Coda Acquisition, Inc. and
Randell A. Bodenhamer filed as Exhibit 99.5 to the October 1995 8-
K, and incorporated by reference herein.
10.13/(2)/ Executive Employment Agreement between Coda Acquisition, Inc. and
J. William Freeman filed as Exhibit 99.6 to the October 1995 8-K,
and incorporated by reference herein.
10.14/(2)/ Executive Employment Agreement between Coda Acquisition, Inc. and
Grant W. Henderson filed as Exhibit 99.7 to the October 1995 8-K,
and incorporated by reference herein.
10.15/(2)/ Executive Employment Agreement between Coda Acquisition, Inc. and
Jarl P. Johnson filed as Exhibit 99.8 to the October 1995 8-K, and
incorporated by reference herein.
10.16/(2)/ Executive Employment Agreement between Coda Acquisition, Inc. and
Douglas H. Miller filed as Exhibit 99.9 to the October 1995 8-K,
and incorporated by reference herein.
10.17/(2)/ Executive Employment Agreement between Coda Acquisition, Inc. and
J.W. Spencer, III filed as Exhibit 99.10 to the October 1995 8-K,
and incorporated by reference herein.
10.18/(2)/ Amendment No. 1 to Subscription Agreement dated as of January 10,
1996 filed as Exhibit 99.2 to Coda's Current Report on Form S-K
dated January 10, 1996, and incorporated by reference herein.
10.19/(2)/ Amendment No. 1 to Stockholders Agreement dated as of January 10,
1996 filed as Exhibit 99.3 to Coda's Current Report on Form 8-K
dated January 10, 1996, and incorporated by reference herein.
10.20 Credit Agreement, dated February 14, 1996, among the Company,
NationsBank, individually and as agent, and additional lenders
named therein filed as Exhibit 4.4 above.
10.21 Promissory Note dated February 14, 1996, in the original principal
amount of $87,500,000.00, executed by Coda, payable to
NationsBank, filed as Exhibit 4.5 above.
10.22 Promissory Note dated February 14, 1996, in the original principal
amount of $37,500,000.00, executed by Coda, payable to Bank One,
Texas, N.A. filed as Exhibit 4.6 above.
22
<PAGE>
10.23 Promissory Note dated February 14, 1996, in the original principal
amount of $75,000,000.00, executed by Coda, payable to Texas
Commerce Bank National Association filed as Exhibit 4.7 above.
10.24 Promissory Note dated February 14, 1996, in the original principal
amount of $50,000,000.00, executed by Coda, payable to the First
National Bank of Boston filed as Exhibit 4.8 above.
10.25/(2)/ Form of Nonstatutory Stock Option Agreement attached and filed as
Exhibit A to Exhibit 99.3 to the October 1995 8-K, and
incorporated by reference herein.
10.26/(2)/ Form of Limited Recourse Promissory Note attached and filed as
Exhibit B to Exhibit 99.3 to the October 1995 8-K, and
incorporated by reference herein.
10.27/(2)/ Form of Security Agreement attached and filed as Exhibit C to
Exhibit 99.3 to the October 1995 8-K, and incorporated by
reference herein.
10.28/(2)/ List of Management Investors who are parties to Nonstatutory Stock
Option Agreement (Exhibit 10.25), Limited Recourse Promissory Note
(Exhibit 10.26) or Security Agreement (Exhibit 10.27) filed as
Exhibit 10.27 to the 1996 Form S-4, and incorporated by reference
herein.
10.29 First Amendment to Credit Agreement, dated August 1, 1996, among
the Company, NationsBank and additional lenders named therein
filed as Exhibit 4.11 above.
10.30/(2)/ Limited Recourse Promissory Note dated July 31, 1996, in the
original principal amount of $1,187,500.00 executed by Douglas H.
Miller, payable to the Company, filed as Exhibit 10.30 to the
September 1996 10-Q, and incorporated by reference herein.
10.31/(2)/ Amendment to Nonstatutory Stock Option Agreement dated July 31,
1996 between the Company and Douglas H. Miller filed as Exhibit
10.31 to the September 1996 10-Q, and incorporated by reference
herein amending the Nonstatutory Stock Option Agreement filed as
Exhibit 10.25 above.
27/(1)/ Financial data schedule
- ----------------------------------------------------------
/(1)/ Filed herewith.
/(2)/ Identifies management contract or compensation plan.
23
<PAGE>
(B) Reports on Form 8-K - None
- -------------------------------------------------------------------------------
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Company has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CODA ENERGY, INC.
(Registrant)
By: \s\ Grant W. Henderson
---------------------------------------
Grant W. Henderson
President and Chief Financial Officer
Date: August 11, 1997
24
<PAGE>
EXHIBIT INDEX
Sequential
Exhibit No. Description of Exhibit Page No.
- ----------- ---------------------- ----------
27.* Financial Data Schedule
- ----------------
* Filed herewith
25
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE INTERIM
FINANCIAL STATEMENTS OF CODA ENERGY, INC. FOR THE QUARTERLY PERIOD ENDED JUNE
30, 1997, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<CASH> 6,296
<SECURITIES> 0
<RECEIVABLES> 11,638
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 18,811
<PP&E> 305,859
<DEPRECIATION> 35,959
<TOTAL-ASSETS> 297,443
<CURRENT-LIABILITIES> 15,223
<BONDS> 178,100
0
20,000
<COMMON> 9
<OTHER-SE> 46,383
<TOTAL-LIABILITY-AND-EQUITY> 297,443
<SALES> 59,262
<TOTAL-REVENUES> 59,876
<CGS> 35,968
<TOTAL-COSTS> 35,968
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 8,077
<INCOME-PRETAX> 1,961
<INCOME-TAX> 903
<INCOME-CONTINUING> 1,058
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<NET-INCOME> 1,058
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