As Reported | Pro Forma Adjustments | Notes | As Adjusted | ||||||||||
ASSETS | |||||||||||||
Current assets: | |||||||||||||
Cash and cash equivalents | $ | 980,666 | $ | 777,026 | (a) | $ | 1,757,692 | ||||||
Accounts receivable | 140,799 | 140,799 | |||||||||||
Derivative asset | 109,818 | 109,818 | |||||||||||
Prepaid expenses and other | 15,326 | (5,700 | ) | (e) | 9,626 | ||||||||
Total current assets | 1,246,609 | 771,326 | 2,017,935 | ||||||||||
Property and equipment (successful efforts method): | |||||||||||||
Proved oil and gas properties | 5,406,656 | 5,406,656 | |||||||||||
Less - accumulated depletion, depreciation, and amortization | (2,668,060 | ) | (2,668,060 | ) | |||||||||
Unproved oil and gas properties | 177,787 | 177,787 | |||||||||||
Wells in progress | 201,241 | 201,241 | |||||||||||
Oil and gas properties held for sale, net | 1,109,517 | (739,462 | ) | (b) | 370,055 | ||||||||
Other property and equipment, net of accumulated depreciation of $41,958 and $32,956, respectively | 137,553 | 137,553 | |||||||||||
Total property and equipment, net | 4,364,694 | (739,462 | ) | 3,625,232 | |||||||||
Noncurrent assets: | |||||||||||||
Derivative asset | 107,029 | 107,029 | |||||||||||
Restricted cash | 49,000 | 49,000 | |||||||||||
Other noncurrent assets | 18,101 | 18,101 | |||||||||||
Total other noncurrent assets | 174,130 | — | 174,130 | ||||||||||
Total Assets | $ | 5,785,433 | $ | 31,864 | $ | 5,817,297 | |||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||||
Current liabilities: | |||||||||||||
Accounts payable and accrued expenses | $ | 277,571 | $ | 3,800 | (e) | $ | 281,371 | ||||||
Derivative liability | 51,059 | 51,059 | |||||||||||
Total current liabilities | 328,630 | 3,800 | 332,430 | ||||||||||
Noncurrent liabilities: | |||||||||||||
Revolving credit facility | — | — | |||||||||||
Senior Notes, net of unamortized deferred financing costs (note 5) | 2,765,398 | 2,765,398 | |||||||||||
Senior Convertible Notes, net of unamortized discount and deferred financing costs | 128,925 | 128,925 | |||||||||||
Asset retirement obligation | 66,158 | 66,158 | |||||||||||
Asset retirement obligation associated with oil and gas properties held for sale | 46,290 | (18,678 | ) | (c) | 27,612 | ||||||||
Net Profits Plan liability | 1,162 | (1,162 | ) | (d) | — | ||||||||
Deferred income taxes | 453,712 | 1,379 | (e) | 455,091 | |||||||||
Derivative liability | 104,705 | 104,705 | |||||||||||
Other noncurrent liabilities | 42,538 | 42,538 | |||||||||||
Total noncurrent liabilities | 3,608,888 | (18,461 | ) | 3,590,427 | |||||||||
Commitments and contingencies | |||||||||||||
Stockholders’ equity: | |||||||||||||
Common stock, $0.01 par value - authorized: 200,000,000 shares; issued and outstanding: 86,868,482 and 68,075,700, respectively | 869 | 869 | |||||||||||
Additional paid-in capital | 866,239 | 866,239 | |||||||||||
Retained earnings | 994,969 | 46,525 | (f) | 1,041,494 | |||||||||
Accumulated other comprehensive loss | (14,162 | ) | (14,162 | ) | |||||||||
Total stockholders’ equity | 1,847,915 | 46,525 | 1,894,440 | ||||||||||
Total Liabilities and Stockholders’ Equity | $ | 5,785,433 | $ | 31,864 | $ | 5,817,297 |
As Reported | Pro Forma Adjustments | Notes | As Adjusted | ||||||||||
Operating revenues: | |||||||||||||
Oil, gas, and NGL production revenue | $ | 832,130 | $ | (108,226 | ) | (g) | $ | 723,904 | |||||
Net gain on divestiture activity | 3,413 | 3,413 | |||||||||||
Other operating revenues | 2,007 | 2,007 | |||||||||||
Total operating revenues and other income | 837,550 | (108,226 | ) | 729,324 | |||||||||
Operating expenses: | |||||||||||||
Oil, gas, and NGL production expense | 445,658 | (42,400 | ) | (g) | 403,258 | ||||||||
Depletion, depreciation, amortization, and asset retirement obligation liability accretion | 619,193 | (95,792 | ) | (h) | 523,401 | ||||||||
Exploration | 41,942 | 41,942 | |||||||||||
Impairment of proved properties | 277,834 | 277,834 | |||||||||||
Abandonment and impairment of unproved properties | 5,917 | 5,917 | |||||||||||
General and administrative | 93,117 | 93,117 | |||||||||||
Change in Net Profits Plan liability | (6,449 | ) | (6,449 | ) | |||||||||
Derivative loss | 121,086 | 121,086 | |||||||||||
Other operating expenses | 14,180 | 14,180 | |||||||||||
Total operating expenses | 1,612,478 | (138,192 | ) | 1,474,286 | |||||||||
Loss from operations | (774,928 | ) | 29,966 | (744,962 | ) | ||||||||
Non-operating income (expense): | |||||||||||||
Interest expense | (112,329 | ) | (112,329 | ) | |||||||||
Gain on extinguishment of debt | 15,722 | 15,722 | |||||||||||
Other, net | 232 | 232 | |||||||||||
Loss before income taxes | (871,303 | ) | 29,966 | (841,337 | ) | ||||||||
Income tax benefit | 314,505 | (11,779 | ) | (j) | 302,726 | ||||||||
Net loss | $ | (556,798 | ) | $ | 18,187 | $ | (538,611 | ) | |||||
Basic weighted-average common shares outstanding | 71,574 | 71,574 | |||||||||||
Diluted weighted-average common shares outstanding | 71,574 | 71,574 | |||||||||||
Basic net loss per common share | $ | (7.78 | ) | $ | (7.53 | ) | |||||||
Diluted net loss per common share | $ | (7.78 | ) | $ | (7.53 | ) |
As Reported | Pro Forma Adjustments | Notes | As Adjusted | ||||||||||
Operating revenues: | |||||||||||||
Oil, gas, and NGL production revenue | $ | 1,499,905 | $ | (201,987 | ) | (g) | $ | 1,297,918 | |||||
Net gain on divestiture activity | 43,031 | 43,031 | |||||||||||
Other operating revenues | 14,029 | 14,029 | |||||||||||
Total operating revenues and other income | 1,556,965 | (201,987 | ) | 1,354,978 | |||||||||
Operating expenses: | |||||||||||||
Oil, gas, and NGL production expense | 723,633 | (61,501 | ) | (g) | 662,132 | ||||||||
Depletion, depreciation, amortization, and asset retirement obligation liability accretion | 921,009 | (135,188 | ) | (h) | 785,821 | ||||||||
Exploration | 120,569 | 120,569 | |||||||||||
Impairment of proved properties | 468,679 | (17,828 | ) | (i) | 450,851 | ||||||||
Abandonment and impairment of unproved properties | 78,643 | 78,643 | |||||||||||
Impairment of other property and equipment | 49,369 | 49,369 | |||||||||||
General and administrative | 157,668 | 157,668 | |||||||||||
Change in Net Profits Plan liability | (19,525 | ) | (19,525 | ) | |||||||||
Derivative gain | (408,831 | ) | (408,831 | ) | |||||||||
Other operating expenses | 44,534 | 44,534 | |||||||||||
Total operating expenses | 2,135,748 | (214,517 | ) | 1,921,231 | |||||||||
Loss from operations | (578,783 | ) | 12,530 | (566,253 | ) | ||||||||
Non-operating income (expense): | |||||||||||||
Other, net | 649 | 649 | |||||||||||
Interest expense | (128,149 | ) | (128,149 | ) | |||||||||
Loss on extinguishment of debt | (16,578 | ) | (16,578 | ) | |||||||||
Loss before income taxes | (722,861 | ) | 12,530 | (710,331 | ) | ||||||||
Income tax benefit | 275,151 | (5,284 | ) | (j) | 269,867 | ||||||||
Net loss | $ | (447,710 | ) | $ | 7,246 | $ | (440,464 | ) | |||||
Basic weighted-average common shares outstanding | 67,723 | 67,723 | |||||||||||
Diluted weighted-average common shares outstanding | 67,723 | 67,723 | |||||||||||
Basic net loss per common share | $ | (6.61 | ) | $ | (6.50 | ) | |||||||
Diluted net loss per common share | $ | (6.61 | ) | $ | (6.50 | ) |
a. | To adjust cash and cash equivalents for the receipt of proceeds from the sale of the Company’s Williston Basin Assets, net of estimated commissions and payments to Net Profits Plan participants. The effective date of the Divestiture is October 1, 2016, therefore, customary closing purchase price adjustments related to the effective period were excluded from pro forma adjustments. |
b. | To eliminate oil and gas properties related to the assets sold, which were previously classified as assets held for sale. |
c. | To eliminate the asset retirement obligation liability related to the assets sold. |
d. | To eliminate the Net Profits Plan liability associated with the assets sold. |
e. | To reflect the estimated change in income tax receivables and payables and deferred income taxes related to additional utilization of gross federal and state net operating losses of $980.0 million resulting in a decrease to deferred tax assets of $246.2 million, offset by the reversal of $225.1 million of net deferred tax liabilities associated with assets sold and the reversal of valuation allowances on deferred tax assets of $10.2 million relating to state net operating losses and other deferred deductions which are now expected to be utilized. |
f. | To record the gain on sale of oil and gas properties, net of tax effect, as illustrated in the table below. As the gain is directly attributable to the Divestiture and is not expected to have a continuing impact on Company’s operations, the estimated gain is only reflected in retained earnings on the unaudited pro forma condensed consolidated balance sheet. |
For the Nine Months Ended September 30, 2016 | |||
(in thousands) | |||
Gross purchase price | $ | 785,000 | |
Less: Customary closing adjustments (1) | — | ||
Cash proceeds received at closing (1) | 785,000 | ||
Less: Commissions | (6,812 | ) | |
Net Divestiture proceeds (1)(2) | 778,188 | ||
Less: Cost basis of assets sold | (720,784 | ) | |
Net gain on the Divestiture, before tax (1)(2) | 57,404 | ||
Less: Tax expense | (10,879 | ) | |
Net gain on the Divestiture (1)(2) | $ | 46,525 |
g. | To eliminate the revenues and direct operating expenses for the assets sold. |
h. | To eliminate depletion, depreciation, amortization, and asset retirement obligation liability accretion expense based on |
i. | To eliminate the historical impairment of proved properties expense recorded for the assets sold. |
j. | To adjust the income tax benefit for the effects of the pro forma adjustments at a 36.5 percent blended federal and state statutory rate and for changes to the state apportionment factor associated with the assets sold. The changes to the state apportionment factor resulted in a 0.1 percent revision to the applicable blended federal and state statutory rate from 36.5 percent to 36.4 percent. The cumulative effect is reflected in the unaudited pro forma condensed consolidated balance sheet, but not in the unaudited pro forma condensed consolidated statements of operations. |