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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 (Date of earliest event reported) April 16, 1997
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SOUTHERN MINERAL CORPORATION
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(Exact name of registrant as specified in charter)
Nevada
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(State or other jurisdiction of incorporation)
0-8043 36-2068676
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(Commission File Number) (IRS Employer Identification No.)
500 Dallas Street, Suite 2800, Houston, Texas 77002-4708
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (713) 658-9444
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(Former name or former address, if changed since last report.)
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ITEM 5. OTHER EVENTS
This Form 8-K is being filed to update to December 31, 1996 the pro forma
financial information contained in the Registrant's Form 8-K dated August 30,
1996, as amended. The August 30, 1996 Form 8-K reported the Registrant's
acquisition for $3,000,000 cash of the limited partnership interest in SMC
Development L. P. which then was dissolved. Upon dissolution, the Registrant
acquired an undivided 93% interest in the properties. Registrant's interest in
certain of the properties will decrease to 81.5% after it has recovered its
costs of acquiring the limited partnership interest. This summary is qualified
in its entirety by the August 30, 1996 Purchase and Sale Agreement Assignment
of Partnership Interest between Registrant and Torch Energy Fund Limited
Partnership I, and Agreement Regarding Dissolution of Partnerships between
Registrant and Diasu Oil & Gas Co., Inc. filed as exhibits to the August 30,
1996 Form 8-K and incorporated herein by reference.
ITEM 7. FINANCIAL STATEMENTS, PROFORMA FINANCIAL INFORMATION AND EXHIBITS
(a) Financial Statements of Businesses Acquired.
SMC Development, L. P. was formed on January 5, 1996, to acquire minority
non-operated working interests in nineteen oil and gas properties and to drill
four development wells. Three of the four development wells were successfully
completed and are expected to commence production in September of 1996.
Financial statements of the acquired operations are not included, since
historical results of operations are not material.
(b) Pro Forma Financial Information.
On August 30, 1996, the Company acquired the limited partnership interest
in SMC Development, L. P. for $3,000,000. The Company previously owned a 7%
general partnership interest in the partnership. The partnership's assets
consisted of proved producing and proved undeveloped oil and gas properties,
with most of the value related to the proved undeveloped properties that were
drilled in 1996.
The pro forma condensed consolidated statement of operations for the twelve
months ended December 31, 1996 presents the acquisition of the SMC Development,
L. P. properties as if it had occurred at January 1, 1996.
(c) Exhibits.
2.1 Purchase and Sale Agreement and Assignment of Partnership Interest,
dated August 30, 1996, by and between Torch Energy Finance Fund
Limited Partnership I and Southern Mineral Corporation (incorporated
by reference to Registrant's Form 8-K dated August 30, 1996).
2.2 Agreement Regarding Dissolution of Partnerships, dated August 30,
1996, between Southern Mineral Corporation and Diasu Oil & Gas Co.,
Inc (incorporated by reference to Registrant's Form 8-K dated August
30, 1996).
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INDEX TO PRO FORMA FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
Page Number
<S> <C>
Pro Forma Condensed Consolidated Statement of
Operations for the Twelve Months Ended
December 31, 1996 (Unaudited) 4
Notes to Pro Forma Condensed Consolidated
Statement of Operations for the Twelve Months
Ended December 31, 1996 (Unaudited) 5
</TABLE>
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SOUTHERN MINERAL CORPORATION
PRO FORMA CONDENSED CONSOLIDATED
STATEMENT OF OPERATIONS
For the Twelve Months Ended December 31, 1996
(OOO's Omitted, except for Share and Per Share Amount)
<TABLE>
<CAPTION>
JAN-AUG
SOUTHERN SMC PRO FORMA ADJUSTMENT TOTAL
MINERAL DEVELOPMENT, ADJUSTMENTS NOTE PRO FORMA
CORPORATION L.P. AMOUNT REFERENCE CONSOLIDATED
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<S> <C> <C> <C> <C> <C>
REVENUES
Oil & Gas $ 11,780 $ 220 $ 0 $ 12,000
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EXPENSES
Production 2,742 87 2,829
Exploration 865 0 865
Depletion & depreciation 2,875 61 (3) 2,936
General & administrative 1,682 6 1,688
Interest 1,242 0 165 (2) 1,407
Other 0 0 0
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9,406 154 165 9,725
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Other income (expense) 739 29 0 768
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Net income (loss) before
income taxes 3,113 95 (165) 3,043
Income tax (benefit) 679 0 (26) (4) 653
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Net income (loss) $ 2,434 $ 95 $ (139) $ 2,390
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Net income per share $ 0.34 $ 0.33
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Weighted average shares
outstanding 7,215 7,215
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</TABLE>
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SOUTHERN MINERAL CORPORATION
NOTES TO PRO FORMA FINANCIAL STATEMENTS
(Unaudited)
Note 1: On August 30, 1996 Southern Mineral Corporation (Southern
Mineral) acquired the limited partnership interest in SMC
Development, L. P. for $3,000,000. Southern Mineral previously owned
a 7% general partnership interest in the partnership. The
partnership's assets consisted of proved producing and proved
undeveloped oil and gas properties, with most of the value related
to proved undeveloped properties and wells drilled in 1996, but not
yet producing.
The pro forma condensed consolidated statement of operations for the
twelve months ended December 31, 1996 presents the acquisition of
the SMC Development, L. P. limited partnership interest as if it had
occurred at January 1, 1996.
This statement should be read in conjunction with the separate
financial statements and notes thereto of Southern Mineral's
previously filed statements. The condensed consolidated pro forma
statement of operations is not necessarily indicative of the results
of operations of the Company as it may be in the future or as if it
might have been had the acquisition been effective at January 1,
1996.
The SMC Development, L. P. amounts for the twelve months ended
December 31, 1996 are from the partnership records.
Note 2: Reflects additional interest expense as a result of debt
financing of the acquisition. The interest rate charged under the
Company's debt financing was, at the Company's option, the bank's
prime rate, floating or LIBOR rate plus two and one half percent.
Note 3: The 1996 depreciation, depletion and amortization (DD&A) for the
SMC Development L. P. (Partnership) acquisition is based on the
carrying value of the producing properties by the partnership.
Partnership carrying value of proved producing properties is the
same as Southern Mineral's carrying value after the acquisition, as
the Partnership's book value of producing properties approximated
their fair value. Accordingly, their is no pro forma adjustment to
the historical 1996 DD&A amount.
Note 4: Reflects reduction in income tax expense caused by reduction in
pro forma earnings, computed using Statement of Financial Accounting
Standards No. 109. Also includes taxes on SMC Development L.P.
income included in the pro forma statement for which no historical
taxes has been recorded due to its partnership status.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this amended report to be signed on its behalf by
the undersigned thereunto duly authorized.
SOUTHERN MINERAL CORPORATION
April 16, 1997 By: /s/ James H Price
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James H. Price
Vice President - Finance
(Chief Accounting Officer)
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