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<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A-1
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) August 30, 1996
----------------------------
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
------------------------ ---------------------------------
(Commission File Number) (IRS Employer Identification No.)
500 Dallas Street, Suite 2800, Houston, Texas 77002-4708
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (713) 658-9444
------------------------
--------------------------------------------------------------
(Former name or former address, if changed since last report.)
<PAGE> 2
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 combined balance sheet as of June 30, 1996,
presents the acquisition of the SMC Development, L. P. properties as if it had
occurred at June 30, 1996, while the condensed combined statements of earnings
for the twelve months ended December 31, 1995, and six months ended June 30,
1996, present the transaction as if it had occurred at January 1, 1995.
(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.
2.2 Agreement Regarding Dissolution of Partnerships, dated August 30,
1996, between Southern Mineral Corporation and Diasu Oil & Gas
Co., Inc.
10.1 Amendment to Credit Agreements between Southern Mineral
Corporation et al and Compass Bank-Houston dated August 30, 1996.
99 News Release of Southern Mineral Corporation dated September 3,
1996.
2
<PAGE> 3
INDEX TO PRO FORMA FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
Page Number
-----------
<S> <C>
Pro Forma Condensed Consolidated Balance Sheet as of
June 30, 1996 (Unaudited) 4
Pro Forma Condensed Consolidated Statement of
Operations for the Twelve Months Ended
December 31, 1995 (Unaudited) 5
Pro Forma Condensed Consolidated Statement of
Operations for the Six Months Ended
June 30, 1996 (Unaudited) 6
Notes to Pro Forma Condensed Consolidated Financial 7
Statements for the balance Sheet as of June 30, 1996,
The Statement of Earnings for the Twelve Months
Ended December 31, 1995, and the Statement of
Earnings for the Six Months Ended June 30, 1996
(Unaudited)
</TABLE>
3
<PAGE> 4
SOUTHERN MINERAL CORPORATION
PRO FORMA CONDENSED CONSOLIDATED
BALANCE SHEET
As of June 30, 1996
(Unaudited)
(000's Omitted)
<TABLE>
<CAPTION>
SOUTHERN SMC PRO FORMA ADJUSTMENTS
MINERAL DEVELOPMENT, NOTE PRO FORMA
CORPORATION L. P. AMOUNT REFERENCE CONSOLIDATED
---------------- --------------- --------------- --------------- -------------
<S> <C> <C> <C> <C> <C>
ASSETS
Current Assets
Cash and cash equivalents $200 -- -- $200
Receivables 1,562 120 1,682
Other 108 28 (28) (2) 108
--------------- -------------- --------------- ------------
Total Current Assets 1,870 148 (28) 1,990
--------------- -------------- --------------- ------------
Property and Equipment, Net 17,397 2,486 422 (3) 20,305
Other Assets 1,954 -- -- 1,954
=============== ============== =============== ============
$21,221 $2,634 $394 $24,249
=============== ============== =============== ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities $419 $28 -- $447
Accounts Payable
Accrued Taxes 226 226
--------------- -------------- --------------- ------------
Total Current Liabilities 645 28 0 673
--------------- -------------- --------------- ------------
Deferred Income Taxes 774 -- -- 774
Long-term debt 12,900 -- 3,000 (2) 15,900
Stockholders' Equity
Partnership Capital Contribution -- 2,530 (2,530) (2) 0
Common Stock 66 -- -- 66
Additional Paid in Capital 3,313 -- -- 3,313
Retained Earnings 3,576 76 (76) 3,576
--------------- -------------- --------------- ------------
6,955 2,606 (2,606) (2) 6,955
Treasury stock (53) -- -- (53)
--------------- -------------- --------------- ------------
Total Stockholders' Equity 6,902 2,606 (2,606) 6,902
--------------- -------------- --------------- ------------
$21,221 $2,634 $394 $24,249
=============== ============== =============== ============
</TABLE>
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<PAGE> 5
SOUTHERN MINERAL CORPORATION
PRO FORMA CONDENSED CONSOLIDATED
STATEMENT OF OPERATONS
For the Twelve Months Ended December 31, 1995
(Unaudited)
(OOO's Omitted, except for Share and Per Share Amount)
<TABLE>
<CAPTION>
1ST QTR 1995 STONE &
SOUTHERN DIVERSE WEBSTER OIL TOTAL PRO FORMA
MINERAL PRODUCTION & GAS PRIOR TO SMD ADJUSTMENT
CORPORATION COMPANY OPERATIONS PRUCHASE AMOUNT
------------- ------------- ------------- ------------- -----------
<S> <C> <C> <C> <C> <C>
REVENUES
Oil & Gas $2,044 $197 $6,585 $8,826 $0
------------ ------------ ------------ ------------ -----------
EXPENSES
Production 656 124 2,340 3,120
Exploration 221 0 217 438
Depletion & depreciation 792 51 1,789 2,632 469 (5)
(24)(7)
General & administrative 702 14 1,710 2,426
Interest 0 0 0 0 1,363 (4)
Other 117 0 0 117
------------ ------------ ------------ ------------ -----------
2,488 189 6,056 8,733 1,808
------------ ------------ ------------ ------------ -----------
Other income (expense) 316 53 1,982 2,351 (1,358)(8)
------------ ------------ ------------ ------------ -----------
Net income (loss) before
income taxes (128) 61 2,511 2,444 (3,166)
Income tax 9 0 780 789 (557)(6)
------------ ------------ ------------ ------------ -----------
Net income (loss) ($137) $61 $1,731 $1,655 ($2,609)
============ ============ ============ ============ ===========
Net income per share ($0.02)
============
Weighted average shares
outstanding 5,701
============
<CAPTION>
PRO FORMA SMC PRO FORMA TOTAL
TOTAL PRIOR TO DEVELOPMENT, ADJUSTMENTS PRO FORMA
SMD PURCHASE L.P. AMOUNT CONSOLIDATED
-------------- ------------ ----------- -------------
<S> <C> <C> <C> <C>
REVENUES
Oil & Gas $8,826 $313 $0 $9,139
------------- ----------- ----------- -----------
EXPENSES
Production 3,120 110 3,230
Exploration 438 0 438
Depletion & depreciation 3,077 87 3,164
General & administrative 2,426 2 2,428
Interest 1,363 0 248 (5) 1,611
Other 117 0 117
------------- ----------- ----------- -----------
10,541 199 248 10,988
------------- ----------- ----------- -----------
Other income (expense) 993 0 0 993
------------- ----------- ----------- -----------
Net income (loss) before
income taxes (722) 114 (248) (856)
Income tax 232 0 0 232
------------- ----------- ----------- -----------
Net income (loss) ($954) $114 ($248) ($1,088)
============= =========== =========== ===========
Net income per share ($0.19)
===========
Weighted average shares
outstanding 5,701
===========
</TABLE>
5
<PAGE> 6
SOUTHERN MINERAL CORPORATION
PRO FORMA CONDENSED CONSOLIDATED
STATEMENT OF OPERATIONS
For the Six Months Ended June 30, 1996
(Unaudited)
(000's Omitted, except for Share and Per Share Amounts)
<TABLE>
<CAPTION>
SOUTHERN SMC PRO FORMA ADJUSTMENTS
MINERAL DEVELOPMENT, NOTE PRO FORMA
CORPORATION L. P. AMOUNT REFERENCE CONSOLIDATED
------------- ------------- ---------------- ------------ -------------
<S> <C> <C> <C> <C> <C>
REVENUES
Oil and Gas $5,210 $121 -- $5,331
------------- ------------- --------------- -----------
EXPENSES
Production 1,163 68 -- 1,231
Exploration 83 -- -- 83
Depletion and depreciation 1,181 5 28 (5) 1,214
General and administrative 822 1 -- 823
Interest 619 -- 124 (4) 743
Other 189 -- -- 189
------------- ------------- --------------- -----------
4,057 74 152 4,283
------------- ------------- --------------- -----------
Other income (expense) 812 29 -- 841
------------- ------------- --------------- -----------
Net income (loss) before
income taxes 1,965 76 (152) 1,889
Income tax 521 -- (26) 495
------------- ------------- --------------- -----------
Net income (loss) $1,444 $76 ($126) $1,394
============= ============= =============== ============
Net income per share $0.22 $0.22
============= ===========
Weighted average shares
outstanding 6,465 6,465
============= ===========
</TABLE>
6
<PAGE> 7
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 balance sheet presents the acquisition of the SMC
Development, L. P. Limited partnership interest as if it had
occurred at June 30, 1996, while the pro forma statement of
operations for the six months ended June 30, 1996 and the year
ended December 31, 1995 present the transaction as if it had
occurred at January 1, 1995.
These statements should be read in conjunction with the separate
financial statements and notes thereto of Southern Mineral's
previously filed statements. The 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, 1995.
Historical amounts for the 1995 statement of operations were
obtained from Diasu Oil & Gas Co., Inc., the owners of the
properties prior to their purchase by SMC Development, L. P.
The amounts for the six months ended June 30, 1996 are from the
partnership records.
Note 2: Reflects purchase of the limited partnership interest. Financing
was obtained through additional long-term debt.
Note 3: Reflects adjustment of the Partnership's historical cost basis in
assets to fair value.
Note 4: 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 5: Reflects depreciation, depletion and amortization, including
amount related to the increase in oil and gas property bases.
Note 6: Reflects reduction in income tax expense caused by reduction in
pro forma earnings.
Note 7: To eliminate amortization of goodwill of purchased entities.
Note 8: To eliminate dividend income from subsidiary.
7
<PAGE> 8
Note 9: Diverse Production Company data is for the first quarter of 1995,
the remaining nine months of 1995 is actual DPC results
consolidated with Southern Mineral Corporation.
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
February 10, 1997 By: /s/ James H Price
--------------------------------
James H. Price
Vice President - Finance
(Chief Accounting Officer)
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