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TD Ameritrade is waiting for the shares of Armada from the transfer agent so they can be put into our account don't know when they will get them that is the way the cookie breaks.
wow, I didnt expect to see my ameritrade account wiped out! : ) here we go.
Mesa Energy Holdings, Inc. acquired by Armada Oil, Inc.
Mesa Energy Holdings, Inc (MSEH) shareholders will receive 0.4 shares of Armada Oil, Inc. (AOIL) for each share held
http://www.otcbb.com/asp/dailylist_detail.asp?d=04/02/2013&mkt_ctg=OTCBB
You have some high hope for the new company. You also seem to have some experience drilling..and even with the property they drilled on...maybe u should lend some of that knowledge to the company to help them succeed...it woukd be nice tk know about the drillint mishap.
I have never bought Armada stock I believe mesh will be the best bet to make money on if you buy Mesa at 14 that would mean you buy 1 share of Armada at .35 cents or less. If Armada does a 2 for 1 reverse split there will be 27 million total shares out there and only about 15 million shares trading on the market this will send the stock to 2 to 3 dollars per share when they hit a horizontal well in ML or Wyoming you can count on that providing oil prices markets I think I know what happened to the ML well in Oklahoma Mesa was drilling around 5,000 feet more or less when they hit this very hard shale rock which can eat up a diamond bit every 400 to 1000 feet and they hit a cavern or opening in the strata well the drill stem and diamond bit probably went say 10 to 30 feet before it hit the formation again but the angle was already pre set by the computer so they kept drilling and this put a bind on the drill stem as it got harder for the drill motor to keep drilling because they were off course they were going to break the drill stem and lose it and then the drilling motor went out Mesa never did explain it but I believe this is about what happened IMO hang on everyone everything will work out.
I believe CEO Randy Griffin to be a stand up guy. He definitely is doing this because he believes it is in shareholder best interests.
Why MSEH could not quickly uplist on its own I do not fully understand. I don't see that Armada adds much assets, mostly opportunity.
You are right they could be more proactive in reporting on the results of drilling and recompletions. We would rather hear bad news than nothing. At least most of the pertinent stuff is going into the 10-Q and 10-K - it is just a long wait for that to come around.
Also they need to do CC's. If they are going to uplist they will definitely need to do a CC. It isn't that hard to set up a gotomeeting.com webinar and read the "safe harbor provision" to start the call and then take questions typed in.
Selling in AOIL is choppy...sold a few shares of AOIL at a loss today. Picked some up just to see how they get snapped up...it has taken quite a while to unload just 5,000 shares.
I suspect trading in MSEH and AOIL will stop very soon. Tried to sell 50k of MSEH at .16 today but not possible...
good luck
That is what I was thinking. Thanks.
your vote wasn't necessary in that they reached the amount of votes they needed. even if you voted against it they would still have the minimum requirements.
They just needed a majority and had it just did the formalities...I was a little perplexed myself but I guess they want to have this documented for SEC purposes.
Can someone fill me in on something... Proxy voting material wasn't received til last Thursday 3/28 but as of this morning the merger is already confirmed. How can that be? Shouldn't there be some time frame to get votes in or did the votes not matter?
germanium123,
You have provided good content on the boards here. Thank you. I do want to add that in this case it may be different. It's not a pump and dump OTC company anymore. It did start that way and there are vultures everywhere trying to make a quick buck. However, Randy has the most to lose here. There is a possibility he collected a good interest rate on the shares hew owns and may have been borrowed in his account to short but we don't know that. His salary is meager at best and has deferred any increase for years until revenue started coming in.
Management is aligned with us, it is in their best interest for the share price to go up. I was shocked to see them provide info on how this works post merger to let the public (shareholders) know that they will have to wait a few days. I haven't seen that type of committment to sharing info in the OTC market. It is a positive sign and has given me new optimism. I now believe they have the capital to begin an aggressive drilling program and that the recent failure of the ML well is not indicative of what they will do next.
good luck. I doubt you will sell MSEH at .168...not probable...
Don't fool yourselves Mesa Energy Management or Armada are looking after their best interest and not the stockholders most companies are that way two months ago Mesa announced bringing in the recompleted LLS10 well and said they were working on more completions and let us know soon well its been over 2 months and we have heard nothing but that's the kind of people they are not very smart can't even complete a horizontal well I finally voted against the merger Mesa did not know that the land they leased in northwestern Oklahoma on the edge of the ML had hard shale rock sitting on top of the ML because they are not a lot of horizontal wells out there oh well I have got 100000 shares in to sell at 0.168 and will sell more if it reaches that price just hoping for the best for all of us.
Well at least in the PR they gave us solid hope for an uplisting. That could get the share price to $0.60 or so with some rrom for higher valuations if they show they are going to drill aggressively without a bunch of dilution.
I am gonna try and sell some at .55 too but have nevr been through this transition so i dont know how it all unfolds.. I am expecting it to pull back. just makes sense.
Ok, so maybe they just ran the proxy to do so and acquire the votes which they knew they would have anyway. Pushed it to the last minute but now they can assure AOIL raises cash and leases can be acquired...next bet is on the drilling plan ad to see that unfold in the near term would be a catalyst.
Immediate selling will be short selling and cover once shares are converted to AOIL. This usually takes a little while with brokers and it depends on each broker. Call them and you get a dumb answer about how it usually just happens...custmoer reps don't usually know much.
I'm thinking it will go in effect and get charged a corporate reorg fee in a few days. I do see AOIL dropping on some profit taking and then solidify at or about B/E or about .45 cents. I'd sell at .55 in a heart beat but do not think i can get the shares converted in time to beat the pack...I'll check with scottrade and fidelity, have Etrade as well.
Anyone else have info, feel free to provide, no single will get out alone, so don't be greedy.
good luck.
http://biz.yahoo.com/e/130329/mseh8-k.html
merger done
Proxy is amateur. First they didn't need consent due to having a majority but now they are running through the process. I wasn't sure if they fell under SEC reporting rules due to being a small cap on OTC but guess they want to operate like a big corp.
It amazes me they didn't get this out sooner. How long does it take to draft a sample proxy solicitation? Just change corporation names and ask a lawyer to give it the go ahead.
I didn't want them to delay so voted anyway.
Seems like germanium has been adding to now have over 400k shares. Hope holding on pays off...I am slowly losing faith in management and time is running out...
It is only a matter of time before the shoe drops in the economy and commodities correct and future revenue for Mesa/AOIL take a hit. If they are going to drill, they better do it ASAP!
Voted for the merger.
I think I will vote all my Mesa Energy shares for the merger a total of 438,000 shares how do the rest of you feel about it I just got my email this morning
Mesa Energy Holdings, Inc. Announces the Filing of a Definitive Proxy Statement
Dallas, TX, March 22, 2013: Mesa Energy Holdings, Inc. (“Mesa”) (OTCBB: MSEH), an oil and gas exploration and production company, announced today that the definitive Proxy Statement relating to the sale of substantially all of Mesa’s assets to Armada Oil, Inc. (OTCBB: AOIL) (“Armada Oil”) in the proposed combination of Mesa's and Armada Oil's business, has been filed with the Securities and Exchange Commission and is currently being disseminated to Mesa’s stockholders of record as of November 23, 2012.
The definitive Proxy Statement contains, among other things, information relating to Mesa’s proposed sale to Armada Oil of 100% of the issued and outstanding shares of Mesa Energy, Inc. (“MEI”), a wholly owned subsidiary of Mesa, which shares constitute substantially all of the assets of Mesa (the “Acquisition”). Pursuant to the Asset Purchase Agreement and Plan of Reorganization, following receipt by Mesa of consent from a majority of its stockholders, Armada Oil and Mesa will close the Acquisition and Armada Oil will issue and distribute, as consideration for the Acquisition, 0.40 shares of its common stock to the stockholders of Mesa for each Mesa common share owned by such stockholders as of the close of business the day before the closing of the Acquisition.
Mesa’s stockholders as of the record date are entitled to vote their shares. The consent of a majority of outstanding Mesa common stock is required to approve the Acquisition. Stockholders may consent or withhold their consent electronically or by mail, by marking, signing, dating and mailing the proxy cards or voting electronically in accordance with the instructions set forth on the proxy card. The Company expects to receive the required number of consents to approve the Acquisition and, subject to the receipt of that vote, anticipates closing the transaction prior to the end of March 2013.
“Our Board has unanimously recommended this transaction and we encourage our shareholders to respond to the consent request as soon as possible. We believe the business combination with Armada Oil will result in a combined company with much greater critical mass, the opportunity for listing on a national exchange and enhanced opportunities for growth in shareholder value,” Randy M. Griffin, Chairman and Chief Executive Officer of Mesa commented. “As designated Chairman and Chief Executive Officer of Armada Oil following the closing of the transaction, I intend to do all I can to grow the combined company into a significant independent oil and gas producer.”
I noticed in Mesa Energy last filing with the sec that had $2,850.000 dollars on hand at the end of 2012.this was before they drilled the ML and lost money. They have not spent a lot of money on non drilling rigs trying to recomplete wells in LA and they have been sitting on revenue received from their production in LA for the last three months I do not expect their PR next Thursday or Friday to have anything special they can't complete a horizontal well so they should hire someone who knows how to do it their stock has stayed the same for the last two years the stockholders are looking for results not excuses.
I heard they were wanting to file by end of Mar and were going through the back and forth with the SEC over the merger filing. I'm not expecting a big post-merger stock price bump, but at least it will be behind us and we can focus on drilling and hopefully an uplisting.
Merger happening soon. Looks like a little interest today. I anticipate more buying on what some believe is a an opportunity to make some money on the value of AOIL post merger. I do not expect AOIL will hold up above .50 post merger---would be too easy!
Good luck to all. We are finally approaching a point to where exploration can commence as "AOIL" combined company.
That is more a referendum on SandRidge than it is of the MS Lime. SandRidge is highly, highly leveraged and they have painted themselves into a corner trying to grow so fast.
So far Mesa hasn't gone and spent a ton of cash to get land they don't have money to drill. The Armada deal though costly to shareholders through dilution - does not paint them into an untenable financial position.
Apparently SD has wasted so much money on corporate planes and executive compensation that a group of activist shareholders are recommending they cut their overhead by 75%!!! A company this size does not need corporate jets. I'd say SD has a wasteful corporate culture.
Mesa energy maybe should not be to excited about the Ml in Oklahoma. I just read about SD energy. all the rating agency have lowered their rating on SD low as $1.00 per share SD is selling about $5.75 per share they say the ML in Oklahoma and Kansas is not producing as well as expected so go to SD site and read about it I maybe thing Mesa should not lease up to much land now after reading about it.
10-K filing is a non-issue. Not a catalyst, IMO. I do not see significant increases in production. Any increase offset by losses due to failed drilling attempt.
AOIL never been a strong company. Has always been speculative with value calculated on land lease valuation. Current purchases in the area support that value, although, I'm not an expert on the specific land region AOIL owns leases in. I recently read about Sinopec buying up leases from Chesapeake.
Armado may own valuable land and can unlock it if they have capital. That comes from an offering to investors looking to provide money for a high-risk return possibility. Not likely right now, who knows the specifics regarding shareholder ownership in Armada?
Armado looks to Mesa to complete the incomplete capital structure. Mesa has cash to use as collateral for financing. Once merged, shares are reduced in new company and easy to do an equity offering or debt financing deal.
The recent attempt at drilling a well set back both companies and I think that's why they pushed the timeline to the right. 10-K value is to shed light on specifics of the issues revolving around the attempt in Oklahoma. Look forward to reading. Only possible short-term catalyst is merger proceeding and Armado being bumped up in share price for reasons I cannot think of right now--would be completely unexpected.
good luck, look for mid-march end of march for a filing. Think they are stretching for time to put a positive spin on developments. they have 90 days to file...
Mesa energy has not released the 4th quarter 2012 report. armada has released their report and it shows Armada had $,8,000 dollars in oil sales for the entire quarter and also lost over one half million dollars for the quarter looks like mesa energy is going to have to bail armada out or they will go under this situation bothers me Mesa had better come up with more oil production in LA and not drill another dry hole in the ML in Oklahoma or we are in for a long year. happy trails to all.
Yeah, they will report that combined.
that is what i meant. I thought they would have a 4th QTR report and also a 2012 year end report. what you said makes sense though. thanks!
No, they aren't late on anything. After Q3 there is no 10Q coming, only the 10K and for that one they have until end of march and 15 days more if they file a late notification filing.
Q4 doesn't get reported extra if that is what you meant.
and they are just way late with the 10Q? it should have been out right?
The 10k is not due until the end of march.
10-K: for Fiscal Year Ended 12/31/12 due Friday, March 01, 2013
10-Q: for Quarterly Period Ended 01/31/13 due Tuesday, March 12, 2013
when did MSEHs QTR end? If it ended in Dec then the report should be out by now, right? I guess the 10k should be out today or tomorrow...
Sold my position today. the merger was intriguing but I just didn't want to wait it out and too many moving parts for me to get comfortable. I'll continue to watch. Good luck!
Chinese buying i to missippian lime play...how so u interpret this? Sinopec buys 2 billion worth of leases from chesapeake...
Also, anyone call randy to ask about armadas feb 28 deadline?
Guess the wait continues...
What about the feb 28 deadline for payment by aoil on lease? They have little money..m
Next obstacle is gov cuts.. market weakness
I don't think there is enough bid on AOIL to reward "first one out" with more than a few thousand dollars. AOIL will quickly move to about $0.36 a share post merger. There are no bids.
yep. said that on the filing from Armada yesterday too.
think I saw that they have moved up the merger time to April on the Mesa and Armada deal. go look at latest sec information posted on Mesa Ameritrade page for Mesa.
I'm guessing some news tomorrow before the weekend. They are really pushing to last minute. AOIL needs financing by the 28th to meet lease agreement requirement.
Still stagnant until after the merger and maybe will disappoint a few immediately after. Does anyone want to guess how long it will take their broker to effect the change in stock symbol and reorg to begin selling? I suspect depends on broker. Tried a few times immediately after a merger with Etrade, Fidelity, and Scottstrade and took a while even after a call to customer service.
Seems like short-term holders will have their finger on the trigger post-merger and first one out wins...this will undoubtedly cause selling pressure. All my opinion.
Good luck.
And eek - Armada has $1.9M in accounts payable. I hope some of that is long term. I guess it is do or die time. I see a lot of deadlines for this and that.
Feb 28 seems to be the date they are aiming to close this merger by. The votes for MSEH already look to be locked up since the deadline was Feb 18 and we are past that.
business combination info from aoil
http://ih.advfn.com/p.php?pid=nmona&article=56407534
They logged the pilot hole they drilled before they went horizontal. For sure this tells them the depth of the various layers and how thick they are. Whether they got any oil flow information from the pilot hole I have no idea. It is very good I would expect them to be mum about it while they buy up lots of land around their position. If it was bad they probably wouldn't say anything either - so it is hard to make any projection from the lack of information.
I believe Mesa energy will drill another horizontal well in the ML in Oklahoma before going to Wyoming in August to drill a horizontal well .look at it this way. you have 1 million dollars more or less in equipment enough to complete a horizontal well just sitting on the ground on a lease in Oklahoma and you are going to Wyoming first to drill a horizontal well in 6 months this is not smart business in my opinion. I know sometimes it takes time to line up another drilling rig to contract to drill the well but they should be able to locate one within 3 months I don't know how they found anything about the ML or the formation below it when they never actually did reach it or logged it they only logged the hole they dug then quit. I can read oil well logs and I have several of them in my office and I have been around several oil fields in Texas so if they found out anything about the ML or formation below it they used a log of another well IMO
agreed. and keep doing what was working for them.
The reserves are amazing. Something like 20x the market cap. With reserves that stunning I don't completely understand why they didn't choose to drill a PUD in LA instead of the MS Lime other than it was a perceived to be riskier.
There was an interesting 8-K that came out today regarding the valuation of their proved, probable, and possible reserves. Here is the letter that they received regarding the valuation:
http://yahoo.brand.edgar-online.com/displayfilinginfo.aspx?FilingID=9097022-4782-17153&type=sect&TabIndex=2&companyid=771387&ppu=%252fdefault.aspx%253fcik%253d1425597
It is interesting to note that armada oil which is taking over Mesa energy has to pay $750,000 dollars for 320 acres in wyoming by the first of may this year to TR energy when they don't have that much money in the bank.also they have one hundred million shares authorized in addition to the 11 million shares out there trading in the market.even when they take over Mesa and have the reverse split they still have the 100 million shares authorized for future operations.sounds like they are having problems with the merger it is taking a lot of time.They had better start producing more oil and produce on the horizonal wells or were in for a long summer.If I were Mesa I would have checked the nearest horizonal well close to the one they quit and asked the company that owned the well what kind of problems they had if any bringing in the well. it could have saved them some trouble,but the rig broke down anyway. until next time good luck and god bless.
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Mesa Energy Holdings, Inc. Now Eligible and Trading on OTCBB |
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MESA ENERGY HOLDINGS, INC.
CONSOLIDATED BALANCE SHEETS
December 31, 2011 | December 31, 2010 | |||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 3,182,392 | $ | 6,096 | ||||
Accounts receivable - oil and gas | 2,460,260 | - | ||||||
Accounts receivable - other | 58,818 | 8,348 | ||||||
Derivative assets, commodity contracts - current | 656,413 | - | ||||||
Deferred financing costs - current | 51,507 | 135,552 | ||||||
Prepaid expenses | 3,971 | 3,750 | ||||||
TOTAL CURRENT ASSETS | 6,413,361 | 153,746 | ||||||
Oil and gas properties, successful efforts accounting: | ||||||||
Properties not subject to amortization less accumulated impairment of $0 and $247,500, respectively | - | - | ||||||
Proved properties subject to amortization less accumulated depletion and impairment of $2,359,193 and $898,483, respectively | 6,727,027 | - | ||||||
Support facilities and equipment less accumulated depreciation of $100,724 and $0, respectively | 2,076,777 | - | ||||||
Land | 48,345 | 38,345 | ||||||
Net oil and gas properties | 8,852,149 | 38,345 | ||||||
Property and equipment less accumulated depreciation of $2,854 and $5,203, respectively | 31,834 | - | ||||||
Deferred tax asset - noncurrent | 3,088,740 | - | ||||||
Deferred financing cost - noncurrent, net of accumulated amortization of $287,943 and $147,072, respectively | 28,431 | - | ||||||
Derivative assets, commodity contracts - noncurrent | 282,537 | - | ||||||
Deposits on asset retirement obligations | 640,000 | 40,000 | ||||||
Other assets | 5,000 | - | ||||||
TOTAL ASSETS | $ | 19,342,052 | $ | 232,091 | ||||
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) | ||||||||
Current liabilities: | ||||||||
Accounts payable - trade | $ | 1,518,603 | $ | 67,409 | ||||
Revenue payable | 796,221 | - | ||||||
Accrued expenses | 259,808 | 778,240 | ||||||
Accrued expenses - related parties | 54,840 | 131,832 | ||||||
Deferred tax liability - current | 212,781 | - | ||||||
Notes payable - related parties | - | 21,000 | ||||||
Notes payable - current | 466,655 | 20,000 | ||||||
Convertible notes payable - current | - | 1,480,000 | ||||||
TOTAL CURRENT LIABILITIES | 3,308,908 | 2,498,481 | ||||||
Non-current liabilities: | ||||||||
Long term debt - related parties | - | 451,400 | ||||||
Notes payable - noncurrent | 5,162,018 | - | ||||||
Convertible notes payable, net of discount of $4,279 and $0, respectively | 461,740 | 665,000 | ||||||
Derivative liability, convertible debt - noncurrent | 113,083 | - | ||||||
Asset retirement obligations | 3,450,252 | 80,217 | ||||||
TOTAL LIABILITIES | 12,496,001 | 3,695,098 | ||||||
Commitments and contingencies | - | - | ||||||
Stockholders' equity (deficit): | ||||||||
Preferred stock, par value $0.0001, 10,000,000 shares authorized, -0- shares issued and outstanding | - | - | ||||||
Common stock, par value $0.0001, 300,000,000 shares authorized, 79,531,616 and 40,232,021 shares issued and outstanding, respectively | 7,953 | 4,023 | ||||||
Additional paid-in capital (deficiency) | (633,745 | ) | (6,786,915 | ) | ||||
Retained earnings | 7,471,843 | 3,319,885 | ||||||
TOTAL STOCKHOLDERS' EQUITY (DEFICIT) | 6,846,051 | (3,463,007 | ) | |||||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) | $ | 19,342,052 | $ | 232,091 |
See accompanying notes to consolidated financial statements.
F - 3 |
MESA ENERGY HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
Year Ended December 31, | ||||||||
2011 | 2010 | |||||||
Revenues | $ | 6,941,354 | $ | 61,647 | ||||
Operating expense: | ||||||||
Lease operating expense | 2,830,241 | 33,407 | ||||||
Exploration cost | 129,478 | 13,492 | ||||||
Depletion, depreciation, amortization, accretion and impairment | 1,429,100 | 1,136,305 | ||||||
General and administrative expense | 1,855,282 | 2,017,244 | ||||||
Gain on sale of oil and gas properties | (22,396 | ) | - | |||||
Total operating expense | 6,221,705 | 3,200,448 | ||||||
Income (loss) from operations | 719,649 | (3,138,801 | ) | |||||
Other income (expense): | ||||||||
Interest income | 2,886 | 3,805 | ||||||
Interest expense | (549,512 | ) | (1,077,269 | ) | ||||
Realized gain on commodity contracts | 137,358 | - | ||||||
Unrealized gain on change in derivatives - commodity contracts | 938,950 | - | ||||||
Unrealized gain (loss) on change in derivatives - convertible debt | (113,083 | ) | 10,773,500 | |||||
Gain on settlement of accounts payable with common stock | 286,041 | - | ||||||
Loss on conversion of debt - related party | (62,306 | ) | - | |||||
Loss on extinguishment of debt | (17,620 | ) | - | |||||
Other income | 25,803 | - | ||||||
Total other income | 648,517 | 9,700,036 | ||||||
Income before income taxes | 1,368,166 | 6,561,235 | ||||||
Income tax benefit | 2,783,792 | - | ||||||
Net income | $ | 4,151,958 | $ | 6,561,235 | ||||
Net income per share: | ||||||||
Basic | $ | 0.07 | $ | 0.16 | ||||
Diluted | $ | 0.06 | $ | 0.13 | ||||
Weighted average number of common shares outstanding: | ||||||||
Basic | 61,494,530 | 39,932,479 | ||||||
Diluted | 67,905,495 | 49,190,627 |
See accompanying notes to consolidated financial statements.
F - 4 |
MESA ENERGY HOLDINGS, INC.
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT)
For the Years Ended December 31, 2011 and 2010
Common Stock | Additional | Retained | ||||||||||||||||||
Par | Paid-In | Earnings | ||||||||||||||||||
Shares | Value | Capital | (Deficit) | Total | ||||||||||||||||
Balances at December 31, 2009 | 39,385,700 | $ | 3,939 | $ | (5,457,156 | ) | $ | (3,241,350 | ) | $ | (8,694,567 | ) | ||||||||
Share-based compensation | 372,900 | 37 | 1,131,504 | - | 1,131,541 | |||||||||||||||
Conversion of convertible debt and accrued interest | 473,421 | 47 | 185,557 | - | 185,604 | |||||||||||||||
Discount on convertible debt | - | - | 665,000 | - | 665,000 | |||||||||||||||
Derivative liability on convertible debt | - | - | (3,311,820 | ) | - | (3,311,820 | ) | |||||||||||||
Net income | - | - | - | 6,561,235 | 6,561,235 | |||||||||||||||
Balances at December 31, 2010 | 40,232,021 | 4,023 | (6,786,915 | ) | 3,319,885 | (3,463,007 | ) | |||||||||||||
Shares issued for cash | 320,000 | 32 | 39,968 | - | 40,000 | |||||||||||||||
Share-based compensation | 816,967 | 83 | 324,242 | - | 324,325 | |||||||||||||||
Shares issued to settle accounts payable | 1,250,000 | 125 | 177,195 | - | 177,320 | |||||||||||||||
Conversion of convertible debt and accrued interest | 14,646,628 | 1,464 | 2,463,624 | - | 2,465,088 | |||||||||||||||
Common shares issued to induce debt conversion | 1,036,000 | 103 | 111,871 | - | 111,974 | |||||||||||||||
Shares issued for acquisition of Tchefuncte Natural Resources, LLC | 21,200,000 | 2,120 | 2,965,880 | - | 2,968,000 | |||||||||||||||
Shares issued in exchange for personal guarantees on debt | 30,000 | 3 | 4,647 | - | 4,650 | |||||||||||||||
Debt discount | - | - | 5,743 | - | 5,743 | |||||||||||||||
Related party forgiveness of debt | - | - | 60,000 | - | 60,000 | |||||||||||||||
Net income | - | - | - | 4,151,958 | 4,151,958 | |||||||||||||||
Balances at December 31, 2011 | 79,531,616 | $ | 7,953 | $ | (633,745 | ) | $ | 7,471,843 | $ | 6,846,051 |
See accompanying notes to consolidated financial statements.
{C}
F - {C}5{C} |
MESA ENERGY HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Years Ended December 31, 2011 and 2010
Year Ended December 31, | ||||||||
2011 | 2010 | |||||||
CASH FLOWS FROM OPERATING ACTIVITIES | ||||||||
Net income | $ | 4,151,958 | $ | 6,561,235 | ||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||||||||
Depreciation, depletion, amortization, accretion and impairment expense | 1,429,100 | 1,136,305 | ||||||
Deferred income taxes | (2,875,959 | ) | - | |||||
Share-based compensation | 324,325 | 1,131,541 | ||||||
Gain on sale of oil and gas assets | (22,396 | ) | - | |||||
Amortization of debt discount charged to interest expense | 1,464 | 665,000 | ||||||
Amortization of deferred financing cost | 140,871 | 147,072 | ||||||
Induced debt conversion expense charged to interest expense | 111,974 | - | ||||||
Shares issued for continuation of loan guarantees charged to interest expense | 4,650 | - | ||||||
Unrealized gain on change in derivative values | (825,867 | ) | (10,773,500 | ) | ||||
Gain on settlement of accounts payable with common stock | (286,041 | ) | - | |||||
Loss on conversion of debt - related party | 62,306 | - | ||||||
Loss on extinguishment of debt | 17,620 | - | ||||||
Changes in operating assets and liabilities: | ||||||||
Accounts receivable - oil and gas | (450,172 | ) | 17,546 | |||||
Accounts receivable - other | (50,470 | ) | - | |||||
Prepaid and other current assets | 11,669 | - | ||||||
Accounts payable and accrued expenses | 904,849 | 670,483 | ||||||
Revenue payable | 663,747 | - | ||||||
Accrued expenses - related party | 50,823 | 27,373 | ||||||
CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES | 3,364,451 | (416,945 | ) | |||||
CASH FLOWS FROM INVESTING ACTIVITIES | ||||||||
Release of restricted cash | - | 20,000 | ||||||
Cash received for sale of oil and gas property | 17,960 | - | ||||||
Cash paid for acquisition of Tchefuncte Natural Resources, LLC, net of cash acquired | (4,809,368 | ) | - | |||||
Cash paid for development of oil and gas properties | (569,689 | ) | (435,462 | ) | ||||
Cash paid for support facilities and equipment | (246,214 | ) | - | |||||
Cash paid for furniture and fixtures | (6,319 | ) | - | |||||
CASH USED IN INVESTING ACTIVITIES | (5,613,630 | ) | (415,462 | ) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||
Proceeds from issuance of stock | 40,000 | - | ||||||
Proceeds from borrowings on debt, net of financing costs | 5,713,086 | 20,000 | ||||||
Proceeds from borrowings on convertible debt, net of financing costs | - | 573,362 | ||||||
Proceeds from borrowings on debt - related party | 72,000 | 21,000 | ||||||
Principal payments on long-term notes payable | (306,611 | ) | - | |||||
Principal payments on debt - related party | (93,000 | ) | (43,000 | ) | ||||
CASH PROVIDED BY FINANCING ACTIVITIES | 5,425,475 | 571,362 | ||||||
NET CHANGE IN CASH | 3,176,296 | (261,045 | ) | |||||
CASH AT BEGINNING OF YEAR | 6,096 | 267,141 | ||||||
CASH AT END OF YEAR | $ | 3,182,392 | $ | 6,096 | ||||
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | ||||||||
Cash paid for interest | $ | 210,495 | $ | 578 | ||||
Cash paid for income taxes | $ | - | $ | - | ||||
NON-CASH INVESTING AND FINACING TRANSACTIONS | ||||||||
Accrued oil and gas development cost | $ | 36,364 | $ | (30,000 | ) | |||
Common stock issued for purchase of Tchefuncte Natural Resources, LLC | $ | 2,968,000 | $ | - | ||||
Derivative liability | $ | - | $ | 3,311,820 | ||||
Common stock issued for the conversion of notes payable and accrued interest | $ | 2,465,088 | $ | 185,604 | ||||
Promissory note and accrued interest exchanged for convertible note | $ | 41,019 | $ | - | ||||
Debt discount on convertible note | $ | 5,743 | $ | - | ||||
Common stock issued to settle accounts payable | $ | 177,320 | $ | - | ||||
Forgiveness of accrued salary by CEO recorded as contributed capital | $ | 60,000 | $ | - |
See accompanying notes to consolidated financial statements.
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MESA ENERGY HOLDINGS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 - ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
Organization
Mesa Energy, Inc. ("MEI") is a wholly owned subsidiary of Mesa Energy Holdings, Inc. (the "Company"). MEI's predecessor entity, Mesa Energy, LLC, was formed in April 2003 as an exploration and production company in the oil and gas industry. MEI's oil and gas operations are conducted through itself and its wholly owned subsidiaries. MEI is a qualified operator in the State of New York and operates the Java Field. Mesa Gulf Coast, LLC, a wholly owned subsidiary, operates all properties in Louisiana. Mesa Energy Operating, LLC is a qualified operator in the states of Texas, Oklahoma, and Wyoming.
On July 22, 2011, MEI acquired Tchefuncte Natural Resources, LLC ("TNR"). TNR owns interests in 80 wells and related surface production equipment in five fields located in Plaquemines and Lafourche Parishes in Louisiana. The operator of all operated properties in Louisiana is Mesa Gulf Coast, LLC. Our operating entities have historically employed, and will continue in the future to employ, on an as-needed basis, the services of drilling contractors, other drilling related vendors, field service companies and professional petroleum engineers, geologists and land men as required in connection with future drilling and production operations.
Basis of Presentation and Principles of Consolidation
The consolidated financial statements herein have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP") and include the accounts of the Company and those of its wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated.
Exploration Stage Company
The Company was previously in the exploration state in accordance with SEC guidance and Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") Topic No 915 - Development Stage Entities. During the year ended December 31, 2011, the Company exited the exploration stage upon the acquisition of TNR.
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