EX-99.3
7
a13-16502_1ex99d3.htm
EX-99.3
Exhibit 99.3
KODIAK OIL & GAS CORP.
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 2012
(amounts in thousands, except share data)
Kodiak
July 2013
Kodiak
Oil & Gas
Acquired
Pro Forma
Oil & Gas
Historical
Properties
Adjustments
Pro Forma
(a)
Revenues:
Oil sales
$
390,425
$
82,256
$
-
$
472,681
Gas sales
18,265
1,621
-
19,886
Total revenues
408,690
83,877
-
492,567
Operating expenses:
Oil and gas production
85,498
17,817
-
103,315
Depletion, depreciation, amortization and accretion
155,634
-
22,800
(b)
178,434
General and administrative
34,528
-
-
34,528
Total expenses
275,660
17,817
22,800
316,277
Operating income
133,030
66,060
(22,800
)
176,290
Other income (expense):
Gain on commodity price risk management activities
44,602
-
-
44,602
Interest income (expense), net
(22,911
)
-
(17,956
)
(c)
(40,867
)
Other income
3,663
-
-
3,663
Total other income (expense)
25,354
-
(17,956
)
7,398
Income before income taxes
158,384
66,060
(40,756
)
183,688
Income tax expense
26,800
-
9,500
(d)
36,300
Net income
$
131,584
$
66,060
$
(50,256
)
$
147,388
Earnings per common share:
Basic
$
0.50
$
0.56
Diluted
$
0.49
$
0.55
Weighted average common shares outstanding:
Basic
263,531,408
-
263,531,408
Diluted
267,671,296
-
267,671,296
(a)
Operating revenues and direct operating expenses of the July 2013 Acquired Properties for the year ended December 31, 2012.
(b)
Reflects additional depletion, depreciation, amortization and accretion expense attributable to the preliminary purchase price allocations.
(c)
Reflects adjustments of (i) $816,000 for the amortization of the origination fees and related closing costs associated with amending and increasing the Company's credit facility used to fund the acquisition; (ii) $17.1 million of incremental interest expense on acquisition financing, using the Company's credit facility. Additionally, the pro forma financial information includes total capitalization of interest expense of $47.3 million.
(d)
Reflects additional income tax expense attributable to the pro forma income from the July 2013 Acquired Properties and the pro forma adjustments for depletion and interest expense.
See accompanying notes to unaudited pro forma consolidated financial statements
KODIAK OIL & GAS CORP.
NOTES TO UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
1. BASIS OF PRESENTATION
On June 2, 2013, Kodiak Oil & Gas (USA) Inc. ("Kodiak USA"), a wholly owned subsidiary of Kodiak Oil & Gas Corp. (the "Company" or "Kodiak"), entered into a definitive purchase and sale agreement with Liberty Resources LLC, a Delaware limited liability company (the "Seller"), under which Kodiak USA has agreed to acquire approximately 42,000 net acres of Williston Basin leaseholds, and related producing properties located primarily in McKenzie and southern Williams Counties, North Dakota, along with various other related rights, permits, contracts, equipment and other assets, including the assignment and assumption of a drilling rig contract (the "July 2013 Acquired Properties"). The effective date for the acquisition is March 1, 2013 (the "Effective Date").
On July 12, 2013, the parties closed the acquisition for aggregate consideration of $731.8 million in cash, which included certain purchase price adjustments calculated at the closing date. The Company funded the acquisition through borrowings under its credit facility.
The Company, Kodiak USA and Seller entered into amendment to the purchase and sale agreement on July 12, 2013 to provide for the transfer of July 2013 Acquired Properties directly to Kodiak Williston, LLC, a newly formed Delaware limited liability company and wholly-owned subsidiary of Kodiak USA.
The unaudited pro forma statement of operations for the year ended December 31, 2012 presents the acquisition of the July 2013 Acquired Properties as if the acquisition had occurred on January 1, 2012. The unaudited pro forma condensed consolidated financial statement is not necessarily indicative of the financial position or results of operations that would have occurred had the acquisition been effected on the assumed dates s. Additionally, future results may vary significantly from the results reflected in the unaudited pro forma consolidated statement of operations due to normal production declines, changes in prices, future transactions, and other factors.
These unaudited pro forma consolidated financial statements should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2012 and the Statements of Operating Revenues and Direct Operating Expenses of the Properties to be Acquired by Kodiak Oil & Gas Corp. for the year ended December 31, 2012 and for the three months ended March 31, 2013 (unaudited) and 2012 (unaudited).
KODIAK OIL & GAS CORP.
NOTES TO UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
2.
PRO FORMA ADJUSTMENTS TO THE CONSOLIDATED STATEMENT OF OPERATIONS
(a) Operating revenues and direct operating expenses of the July 2013 Acquired Properties for the year ended December 31, 2012.
(b) Reflects additional depletion, depreciation, and amortization expense and accretion expense attributable to the preliminary purchase price allocations.
(c) Reflects adjustments of (i) $816,000 for the amortization of the origination fees and related closing costs associated with amending and increasing the Company's credit facility used to fund the acquisition; (ii) $17.1 million of incremental interest expense on acquisition financing, using the Company's credit facility. Additionally, the pro forma financial information includes total capitalization of interest expense of $47.3 million.
(d) Reflects additional income tax expense attributable to the pro forma income from the July 2013 Acquired Properties and the pro forma adjustments for depletion and interest expense.

EX - 99 . 3 7 a13 - 16502 _ 1ex99d3 . htm EX - 99 . 3 Exhibit 99 . 3 KODIAK OIL & GAS CORP . UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31 , 2012 ( amounts in thousands , except share data ) Kodiak July 2013 Kodiak Oil & Gas Acquired Pro Forma Oil & Gas Historical Properties Adjustments Pro Forma ( a ) Revenues : Oil sales $ 390,425 $ 82,256 $ - $ 472,681 Gas sales 18,265 1,621 - 19,886 Total revenues 408,690 83,877 - 492,567 Operating expenses : Oil and gas production 85,498 17,817 - 103,315 Depletion , depreciation , amortization and accretion 155,634 - 22,800 ( b ) 178,434 General and administrative 34,528 - - 34,528 Total expenses 275,660 17,817 22,800 316,277 Operating income 133,030 66,060 ( 22,800 ) 176,290 Other income ( expense ) : Gain on commodity price risk management activities 44,602 - - 44,602 Interest income ( expense ) , net ( 22,911 ) - ( 17,956 ) ( c ) ( 40,867 ) Other income 3,663 - - 3,663 Total other income ( expense ) 25,354 - ( 17,956 ) 7,398 Income before income taxes 158,384 66,060 ( 40,756 ) 183,688 Income tax expense 26,800 - 9,500 ( d ) 36,300 Net income $ 131,584 $ 66,060 $ ( 50,256 ) $ 147,388 Earnings per common share : Basic $ 0 . 50 $ 0 . 56 Diluted $ 0 . 49 $ 0 . 55 Weighted average common shares outstanding : Basic 263,531,408 - 263,531,408 Diluted 267,671,296 - 267,671,296 ( a ) Operating revenues and direct operating expenses of the July 2013 Acquired Properties for the year ended December 31 , 2012 . ( b ) Reflects additional depletion , depreciation , amortization and accretion expense attributable to the preliminary purchase price allocations . ( c ) Reflects adjustments of ( i ) $ 816,000 for the amortization of the origination fees and related closing costs associated with amending and increasing the Company 's credit facility used to fund the acquisition ; ( ii ) $ 17.1 million of incremental interest expense on acquisition financing , using the Company 's credit facility . Additionally , the pro forma financial information includes total capitalization of interest expense of $ 47.3 million . ( d ) Reflects additional income tax expense attributable to the pro forma income from the July 2013 Acquired Properties and the pro forma adjustments for depletion and interest expense . See accompanying notes to unaudited pro forma consolidated financial statements KODIAK OIL & GAS CORP . NOTES TO UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS 1 . BASIS OF PRESENTATION On June 2 , 2013 , Kodiak Oil & Gas ( USA ) Inc . ( " Kodiak USA " ) , a wholly owned subsidiary of Kodiak Oil & Gas Corp . ( the " Company " or " Kodiak " ) , entered into a definitive purchase and sale agreement with Liberty Resources LLC , a Delaware limited liability company ( the " Seller " ) , under which Kodiak USA has agreed to acquire approximately 42,000 net acres of Williston Basin leaseholds , and related producing properties located primarily in McKenzie and southern Williams Counties , North Dakota , along with various other related rights , permits , contracts , equipment and other assets , including the assignment and assumption of a drilling rig contract ( the " July 2013 Acquired Properties " ) . The effective date for the acquisition is March 1 , 2013 ( the " Effective Date " ) . On July 12 , 2013 , the parties closed the acquisition for aggregate consideration of $ 731.8 million in cash , which included certain purchase price adjustments calculated at the closing date . The Company funded the acquisition through borrowings under its credit facility . The Company , Kodiak USA and Seller entered into amendment to the purchase and sale agreement on July 12 , 2013 to provide for the transfer of July 2013 Acquired Properties directly to Kodiak Williston , LLC , a newly formed Delaware limited liability company and wholly - owned subsidiary of Kodiak USA . The unaudited pro forma statement of operations for the year ended December 31 , 2012 presents the acquisition of the July 2013 Acquired Properties as if the acquisition had occurred on January 1 , 2012 . The unaudited pro forma condensed consolidated financial statement is not necessarily indicative of the financial position or results of operations that would have occurred had the acquisition been effected on the assumed dates s . Additionally , future results may vary significantly from the results reflected in the unaudited pro forma consolidated statement of operations due to normal production declines , changes in prices , future transactions , and other factors . These unaudited pro forma consolidated financial statements should be read in conjunction with our Annual Report on Form 10 - K for the year ended December 31 , 2012 and the Statements of Operating Revenues and Direct Operating Expenses of the Properties to be Acquired by Kodiak Oil & Gas Corp . for the year ended December 31 , 2012 and for the three months ended March 31 , 2013 ( unaudited ) and 2012 ( unaudited ) . KODIAK OIL & GAS CORP . NOTES TO UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS 2 . PRO FORMA ADJUSTMENTS TO THE CONSOLIDATED STATEMENT OF OPERATIONS ( a ) Operating revenues and direct operating expenses of the July 2013 Acquired Properties for the year ended December 31 , 2012 . ( b ) Reflects additional depletion , depreciation , and amortization expense and accretion expense attributable to the preliminary purchase price allocations . ( c ) Reflects adjustments of ( i ) $ 816,000 for the amortization of the origination fees and related closing costs associated with amending and increasing the Company 's credit facility used to fund the acquisition ; ( ii ) $ 17.1 million of incremental interest expense on acquisition financing , using the Company 's credit facility . Additionally , the pro forma financial information includes total capitalization of interest expense of $ 47.3 million . ( d ) Reflects additional income tax expense attributable to the pro forma income from the July 2013 Acquired Properties and the pro forma adjustments for depletion and interest expense .
O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O B-Parties.BUYING_COMPANY I-Parties.BUYING_COMPANY I-Parties.BUYING_COMPANY I-Parties.BUYING_COMPANY O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O B-Parties.SELLING_COMPANY I-Parties.SELLING_COMPANY I-Parties.SELLING_COMPANY O O O O O O O O O O O O O O O B-Parties.BUYING_COMPANY I-Parties.BUYING_COMPANY O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O