x
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
¨
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
|
81-5365682
|
(State or other jurisdiction of
incorporation or organization)
|
|
(I.R.S. Employer
Identification No.)
|
|
|
|
1001 Fannin Street, Suite 400
Houston, TX
|
|
77002
|
(Address of principal executive offices)
|
|
(Zip Code)
|
Large accelerated filer
|
|
¨
|
|
Accelerated filer
|
|
¨
|
|
|
|
|
|
|
|
Non-accelerated filer
|
|
x
|
|
Small reporting company
|
|
¨
|
|
|
|
|
|
|
|
|
|
|
|
Emerging growth company
|
|
x
|
|
|
|
|
Page
|
PART I.
|
|
|
|
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Item 1.
|
|
|
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||
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Item 2.
|
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Item 3.
|
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Item 4.
|
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|
||
PART II.
|
|
|
||
Item 1.
|
|
|
||
Item 1A.
|
|
|
||
Item 2.
|
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|
||
Item 3.
|
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||
Item 4.
|
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||
Item 5.
|
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||
Item 6.
|
|
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||
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|
Successor
|
Predecessor
|
||||||||||||||||
|
|
July 31, 2018 through
September 30, 2018 |
July 1, 2018
through
July 30, 2018
|
|
January 1, 2018 through
July 30, 2018
|
|
Three Months Ended September 30, 2017
|
|
Nine Months Ended September 30, 2017
|
||||||||||
REVENUES:
|
|
|
|
|
|
|
|
|
|
||||||||||
Oil revenues
|
|
$
|
143,202
|
|
$
|
68,487
|
|
|
$
|
399,124
|
|
|
$
|
72,706
|
|
|
$
|
240,778
|
|
Natural gas revenues
|
|
14,201
|
|
3,646
|
|
|
22,135
|
|
|
6,925
|
|
|
19,436
|
|
|||||
Natural gas liquids revenues
|
|
21,153
|
|
4,754
|
|
|
27,927
|
|
|
6,984
|
|
|
18,002
|
|
|||||
Total revenues
|
|
178,556
|
|
76,887
|
|
|
449,186
|
|
|
86,615
|
|
|
278,216
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
OPERATING EXPENSES
|
|
|
|
|
|
|
|
|
|
||||||||||
Lease operating expenses
|
|
11,016
|
|
3,681
|
|
|
23,513
|
|
|
6,180
|
|
|
18,931
|
|
|||||
Gathering, transportation and processing
|
|
5,746
|
|
2,240
|
|
|
12,929
|
|
|
3,997
|
|
|
12,238
|
|
|||||
Taxes other than income
|
|
9,351
|
|
2,087
|
|
|
23,763
|
|
|
5,823
|
|
|
18,028
|
|
|||||
Exploration expense
|
|
11,221
|
|
40
|
|
|
492
|
|
|
77
|
|
|
383
|
|
|||||
Asset retirement obligation accretion
|
|
391
|
|
21
|
|
|
104
|
|
|
87
|
|
|
175
|
|
|||||
Depreciation, depletion and amortization
|
|
67,478
|
|
23,157
|
|
|
137,871
|
|
|
27,124
|
|
|
88,844
|
|
|||||
General & administrative expenses
|
|
10,297
|
|
1,701
|
|
|
12,710
|
|
|
4,960
|
|
|
13,224
|
|
|||||
Transaction related costs
|
|
22,366
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total operating costs and expenses
|
|
137,866
|
|
32,927
|
|
|
211,382
|
|
|
48,248
|
|
|
151,823
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
OPERATING INCOME
|
|
40,690
|
|
43,960
|
|
|
237,804
|
|
|
38,367
|
|
|
126,393
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
OTHER INCOME (EXPENSE):
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (loss) from equity method investee
|
|
309
|
|
(345
|
)
|
|
711
|
|
|
(84
|
)
|
|
(85
|
)
|
|||||
Interest expense
|
|
(4,959
|
)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Gain (loss) on derivatives, net
|
|
—
|
|
3,865
|
|
|
(18,127
|
)
|
|
(1,648
|
)
|
|
1,041
|
|
|||||
Other income (expense), net
|
|
(7,019
|
)
|
24
|
|
|
(50
|
)
|
|
—
|
|
|
(20
|
)
|
|||||
Total other income (expense)
|
|
(11,669
|
)
|
3,544
|
|
|
(17,466
|
)
|
|
(1,732
|
)
|
|
936
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
INCOME BEFORE INCOME TAXES
|
|
29,021
|
|
47,504
|
|
|
220,338
|
|
|
36,635
|
|
|
127,329
|
|
|||||
Income tax expense
|
|
3,538
|
|
766
|
|
|
1,785
|
|
|
630
|
|
|
1,967
|
|
|||||
NET INCOME
|
|
25,483
|
|
46,738
|
|
|
218,553
|
|
|
36,005
|
|
|
125,362
|
|
|||||
LESS: Net income attributable to noncontrolling interest
|
|
18,775
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
NET INCOME ATTRIBUTABLE TO CLASS A COMMON STOCK
|
|
$
|
6,708
|
|
$
|
46,738
|
|
|
$
|
218,553
|
|
|
$
|
36,005
|
|
|
$
|
125,362
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
NET INCOME PER COMMON SHARE
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
$
|
0.04
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Diluted
|
|
$
|
0.04
|
|
|
|
|
|
|
|
|
||||||||
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
151,992
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Diluted
|
|
157,072
|
|
|
|
|
|
|
|
|
|
Predecessor
|
||
BALANCE, DECEMBER 31, 2017
|
$
|
1,597,838
|
|
Parents’ contribution, net
|
62,641
|
|
|
Net income
|
218,553
|
|
|
Balance – July 30, 2018
|
$
|
1,879,032
|
|
|
Class A Common Stock
|
Class B Common Stock
|
Class F Common Stock
|
Additional Paid In Capital
|
Accumulated Deficit
|
Total Stockholders' Equity
|
Noncontrolling Interest
|
Total Equity
|
||||||||||||||||||||||
|
Shares
|
Value
|
Shares
|
Value
|
Shares
|
Value
|
|
|
|
|
|
|||||||||||||||||||
Balance, July 30, 2018
|
3,052
|
|
$
|
—
|
|
—
|
|
$
|
—
|
|
16,250
|
|
$
|
2
|
|
$
|
8,370
|
|
$
|
(3,588
|
)
|
$
|
4,784
|
|
$
|
—
|
|
$
|
4,784
|
|
Class A Common Stock released from possible redemption
|
61,948
|
|
6
|
|
—
|
|
—
|
|
—
|
|
—
|
|
619,473
|
|
—
|
|
619,479
|
|
—
|
|
619,479
|
|
||||||||
Class A Common Stock redeemed
|
(1
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(9
|
)
|
—
|
|
(9
|
)
|
—
|
|
(9
|
)
|
||||||||
Conversion of Common Stock from Class F to Class A at closing of Business Combination
|
16,250
|
|
2
|
|
—
|
|
—
|
|
(16,250
|
)
|
(2
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||
Common Stock issued as part of the Business Combination
|
31,791
|
|
3
|
|
83,939
|
|
9
|
|
—
|
|
—
|
|
391,017
|
|
—
|
|
391,029
|
|
1,032,455
|
|
1,423,484
|
|
||||||||
Class A Common Stock issuance in private placement
|
35,500
|
|
4
|
|
—
|
|
—
|
|
—
|
|
—
|
|
354,996
|
|
—
|
|
355,000
|
|
—
|
|
355,000
|
|
||||||||
Earnout consideration issued as part for the Business Combination
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
41,371
|
|
—
|
|
41,371
|
|
108,329
|
|
149,700
|
|
||||||||
Non-compete consideration
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
44,400
|
|
—
|
|
44,400
|
|
—
|
|
44,400
|
|
||||||||
Changes in ownership interest adjustment
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
206,966
|
|
—
|
|
206,966
|
|
(206,966
|
)
|
—
|
|
||||||||
Changes in deferred tax liability
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(52,787
|
)
|
—
|
|
(52,787
|
)
|
—
|
|
(52,787
|
)
|
||||||||
Balance, July 31, 2018
|
148,540
|
|
15
|
|
83,939
|
|
9
|
|
—
|
|
—
|
|
1,613,797
|
|
(3,588
|
)
|
1,610,233
|
|
933,818
|
|
2,544,051
|
|
||||||||
Issuance of earnout share consideration Tranche I
|
1,244
|
|
—
|
|
3,256
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||
Issuance of earnout share consideration Tranche II
|
1,244
|
|
—
|
|
3,256
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||
Issuance of shares in connection with Harvest Acquisition
|
4,200
|
|
1.0
|
|
—
|
|
—
|
|
—
|
|
—
|
|
58,211
|
|
—
|
|
58,212
|
|
—
|
|
58,212
|
|
||||||||
Net income
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
6,708
|
|
6,708
|
|
18,775
|
|
25,483
|
|
||||||||
Changes in ownership interest adjustment
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(39,366
|
)
|
—
|
|
(39,366
|
)
|
39,366
|
|
—
|
|
||||||||
Changes in deferred tax liability
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
15,263
|
|
—
|
|
15,263
|
|
—
|
|
15,263
|
|
||||||||
Balance, September 30, 2018
|
155,228
|
|
$
|
16
|
|
90,451
|
|
$
|
9
|
|
—
|
|
$
|
—
|
|
$
|
1,647,905
|
|
$
|
3,120
|
|
$
|
1,651,050
|
|
$
|
991,959
|
|
$
|
2,643,009
|
|
|
Successor
|
Predecessor
|
||||||||
|
July 31, 2018 through
September 30, 2018
|
January 1, 2018 through July 30, 2018
|
|
Nine Months Ended September 30, 2017
|
||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
||||||
Net Income
|
$
|
25,483
|
|
$
|
218,553
|
|
|
$
|
125,362
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
||||||
Depreciation, depletion and amortization
|
67,478
|
|
137,871
|
|
|
88,844
|
|
|||
Asset retirement obligations accretion expense
|
391
|
|
104
|
|
|
175
|
|
|||
Amortization of deferred financing costs
|
570
|
|
—
|
|
|
—
|
|
|||
Non-cash interest expense
|
4,206
|
|
—
|
|
|
—
|
|
|||
(Gain) loss on derivatives, net
|
—
|
|
18,127
|
|
|
(1,041
|
)
|
|||
Cash settlements of matured derivative contracts
|
—
|
|
(27,617
|
)
|
|
52
|
|
|||
Deferred taxes
|
3,493
|
|
324
|
|
|
1,119
|
|
|||
Contingent consideration change in fair value
|
6,700
|
|
—
|
|
|
—
|
|
|||
Other
|
(218
|
)
|
(796
|
)
|
|
(189
|
)
|
|||
Changes in assets and liabilities, net of amounts acquired:
|
|
|
|
|
||||||
Account receivable
|
(77,500
|
)
|
(61,405
|
)
|
|
(28,113
|
)
|
|||
Prepaid expenses and other assets
|
(282
|
)
|
—
|
|
|
(624
|
)
|
|||
Accounts payable and accrued liabilities
|
60,312
|
|
36
|
|
|
7,539
|
|
|||
Other assets and liabilities, net
|
45
|
|
(385
|
)
|
|
—
|
|
|||
Net cash provided by (used in) operating activities
|
90,678
|
|
284,812
|
|
|
193,124
|
|
|||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
||||||
Proceeds withdrawn from Trust Account
|
656,078
|
|
—
|
|
|
—
|
|
|||
Acquisition of EnerVest properties
|
(1,219,217
|
)
|
—
|
|
|
—
|
|
|||
Acquisitions, other
|
(135,652
|
)
|
(150,139
|
)
|
|
(58,653
|
)
|
|||
Additions to oil and natural gas properties
|
(37,100
|
)
|
(197,314
|
)
|
|
(188,205
|
)
|
|||
Purchase of and contributions to equity method investment
|
—
|
|
—
|
|
|
(8,788
|
)
|
|||
Payment of Contingent Consideration
|
(26,000
|
)
|
—
|
|
|
—
|
|
|||
Net cash used in investing activities
|
(761,891
|
)
|
(347,453
|
)
|
|
(255,646
|
)
|
|||
CASH FLOW FROM FINANCING ACTIVITIES:
|
|
|
|
|
||||||
Parents’ contribution, net
|
—
|
|
62,641
|
|
|
62,522
|
|
|||
Issuance of common stock
|
355,000
|
|
—
|
|
|
—
|
|
|||
Proceeds from issuance of long term debt
|
400,000
|
|
—
|
|
|
—
|
|
|||
Repayments of deferred underwriting compensation
|
(22,750
|
)
|
—
|
|
|
—
|
|
|||
Cash paid for debt issuance costs
|
(23,336
|
)
|
—
|
|
|
—
|
|
|||
Other financing activities
|
(1,009
|
)
|
—
|
|
|
—
|
|
|||
Net cash provided by financing activities
|
707,905
|
|
62,641
|
|
|
62,522
|
|
|||
NET CHANGE IN CASH AND CASH EQUIVALENTS
|
36,692
|
|
—
|
|
|
—
|
|
|||
CASH AND CASH EQUIVALENTS – Beginning of period
|
23
|
|
—
|
|
|
—
|
|
|||
CASH AND CASH EQUIVALENTS – End of period
|
$
|
36,715
|
|
$
|
—
|
|
|
$
|
—
|
|
SUPPLEMENTAL CASH FLOW INFORMATION:
|
|
|
|
|
||||||
Cash paid for income taxes
|
$
|
—
|
|
$
|
336
|
|
|
$
|
43
|
|
Cash paid for interest
|
350
|
|
—
|
|
|
—
|
|
|||
Supplemental non-cash investing and financing activity
|
|
|
|
|
||||||
Accruals or liabilities for capital expenditures
|
45,242
|
|
38,028
|
|
|
54,968
|
|
|||
Contingent Consideration issued in Business Combination
|
149,700
|
|
|
|
|
|||||
Non-Compete agreement
|
44,400
|
|
|
|
|
|||||
Equity issuances in connection with business combinations
|
1,481,695
|
|
—
|
|
|
—
|
|
•
|
certain right, title and interest in certain oil and natural gas assets located primarily in the Karnes County portion of the Eagle Ford Shale in South Texas (the "Karnes County Assets" and, such business the “Karnes County Business”) pursuant to that certain Contribution and Merger Agreement (as subsequently amended, the “Karnes County Contribution Agreement”), by and among the Company, Magnolia LLC and certain affiliates (the “Karnes County Contributors”) of EnerVest Ltd. (“EnerVest”);
|
•
|
certain right, title and interest in certain oil and natural gas assets located primarily in the Giddings Field of the Austin Chalk (the "Giddings Assets") pursuant to that certain Purchase and Sale Agreement (the “Giddings Purchase Agreement”) by and among Magnolia LLC and certain affiliates of EnerVest (the “Giddings Sellers”); and
|
•
|
an approximately
35%
membership interest (the “Ironwood Interests” and together with the Karnes County Assets and the Giddings Assets, the “Acquired Assets”) in Ironwood Eagle Ford Midstream, LLC ("Ironwood"), a Texas limited liability company, which owns an Eagle Ford gathering system, pursuant to that certain Membership Interest Purchase Agreement (the “Ironwood MIPA” and, together with the transactions contemplated by the Karnes County Contribution Agreement and the Giddings Purchase Agreement, the “Business Combination Agreements” and the transactions contemplated thereby, the “Business Combination”), by and among Magnolia LLC and certain affiliates of EnerVest (the “Ironwood Sellers”).
|
|
|
At July 31,
2018 (in thousands) |
||
Preliminary Purchase Consideration:
|
|
|
||
Cash consideration
|
|
$
|
1,219,217
|
|
Stock consideration
(1)
|
|
1,423,483
|
|
|
Fair value of contingent earnout purchase consideration
(2)
|
|
169,000
|
|
|
Total purchase price consideration
|
|
$
|
2,811,700
|
|
(1)
|
At closing of the Business Combination, the Karnes County Contributors received
83.9 million
shares of Class B Common Stock and
31.8 million
shares of Class A Common Stock.
|
(2)
|
Pursuant to ASC 805, ASC 480, "Distinguishing Liabilities from Equity" and ASC 815, "Derivatives and Hedging", the Karnes County earnout consideration has been valued at fair value as of the Closing Date and has been classified in stockholders’ equity. The Giddings earnout has been valued at fair value as of the Closing Date and has been classified as a liability. The fair value of the earnouts was determined using the Monte Carlo simulation valuation method based on Level 3 inputs in the fair value hierarchy.
|
|
|
At July 31,
2018
(in thousands)
|
||
Estimated fair value of assets acquired
|
|
|
||
Account receivable
|
|
$
|
89,674
|
|
Other current assets
|
|
2,853
|
|
|
Oil & gas properties
(1)
|
|
2,800,258
|
|
|
Ironwood equity investment
|
|
18,100
|
|
|
Total fair value of assets acquired
|
|
2,910,885
|
|
|
Estimated fair value of liabilities assumed
|
|
|
||
Accounts payable and other current liabilities
|
|
(56,315
|
)
|
|
Asset retirement obligation
|
|
(34,132
|
)
|
|
Deferred tax liability
|
|
(8,738
|
)
|
|
Fair value of net assets acquired
|
|
$
|
2,811,700
|
|
(1)
|
The fair value measurements of oil and natural gas properties and asset retirement obligations are based on inputs that are not observable in the market and therefore represent Level 3 inputs. The fair values of oil and natural gas properties and asset retirement obligations were measured using valuation techniques that convert future cash flows to a single discounted amount. Significant inputs to the valuation of oil and natural gas properties included estimates of: (i) recoverable reserves; (ii) production rates; (iii) future operating and development costs; (iv) future commodity prices; and (v) a market-based weighted average cost of capital rate. These inputs required significant judgments and estimates by management at the time of the valuation and may be subject to change.
|
|
|
At August 31,
2018
(in thousands)
|
||
Estimated fair value of assets acquired
|
|
|
||
Other current assets
|
|
$
|
1,290
|
|
Oil & gas properties
(1)
|
|
200,035
|
|
|
Total fair value of assets acquired
|
|
201,325
|
|
|
Estimated fair value of liabilities assumed
|
|
|
||
Asset retirement obligation and other current liabilities
|
|
(9,812
|
)
|
|
Fair value of net assets acquired
|
|
$
|
191,513
|
|
(1)
|
The fair value measurements of oil and natural gas properties and asset retirement obligations are based on inputs that are not observable in the market and therefore represent Level 3 inputs. The fair values of oil and natural gas properties and asset retirement obligations were measured using valuation techniques that convert future cash flows to a single discounted amount. Significant inputs to the valuation of oil and natural gas properties included estimates of: (i) recoverable reserves; (ii) production rates; (iii) future operating and development costs; (iv) future commodity prices; and (v) a market-based weighted average cost of capital rate. These inputs required significant judgments and estimates by management at the time of the valuation and may be subject to change.
|
(In thousands)
|
|
|
||
Total consideration
|
|
$
|
58,653
|
|
|
|
|
||
Purchase price allocation:
|
|
|
||
Accounts receivable
|
|
2,193
|
|
|
Proved oil and natural gas properties
|
|
57,263
|
|
|
Unproved oil and natural gas properties
|
|
1,552
|
|
|
Accounts payable and accrued liabilities
|
|
(2,244
|
)
|
|
Asset retirement obligations
|
|
(111
|
)
|
|
|
|
$
|
58,653
|
|
(In thousands)
|
|
Gross
Amounts of
Recognized Assets
|
|
Gross
Amounts of
Offset in the Balance Sheet
|
|
Net Amounts
Of Assets
Presented in the
Balance Sheet
|
||||||
Derivatives
|
|
|
|
|
|
|
||||||
As of December 31, 2017 (Predecessor):
|
|
|
|
|
|
|
||||||
Derivative asset
|
|
$
|
180
|
|
|
$
|
(180
|
)
|
|
$
|
—
|
|
Long-term derivative asset
|
|
48
|
|
|
(48
|
)
|
|
—
|
|
|||
Total
|
|
$
|
228
|
|
|
$
|
(228
|
)
|
|
$
|
—
|
|
|
|
|
|
|
|
|
||||||
|
|
Gross Amounts of Recognized Liabilities
|
|
Gross Amounts Offset in the
Balance Sheet
|
|
Net Amounts
Of Liabilities
Presented in the
Balance Sheet
|
||||||
Derivatives
|
|
|
|
|
|
|
||||||
As of December 31, 2017 (Predecessor):
|
|
|
|
|
|
|
||||||
Derivative liability
|
|
$
|
6,944
|
|
|
$
|
(180
|
)
|
|
$
|
6,764
|
|
Long-term derivative liability
|
|
3,100
|
|
|
(48
|
)
|
|
3,052
|
|
|||
Total
|
|
$
|
10,044
|
|
|
$
|
(228
|
)
|
|
$
|
9,816
|
|
(In thousands)
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total Fair Value
|
||||||||
As of December 31, 2017 (Predecessor):
|
|
|
|
|
|
|
|
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
||||||||
Oil, natural gas and natural gas liquids derivatives
|
|
$
|
—
|
|
|
$
|
228
|
|
|
$
|
—
|
|
|
$
|
228
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
||||||||
Oil, natural gas and natural gas liquids derivatives
|
|
$
|
—
|
|
|
$
|
10,044
|
|
|
$
|
—
|
|
|
$
|
10,044
|
|
|
|
September 30, 2018
|
||||||
(In thousands)
|
|
Carrying Value
|
|
Fair Value
|
||||
Long-term debt
|
|
$
|
388,343
|
|
|
$
|
399,000
|
|
(In thousands)
|
September 30, 2018 (Successor)
|
||
Non-Compete Intangible Asset
|
$
|
44,400
|
|
Accumulated amortization
|
(2,417
|
)
|
|
Intangible, net
|
$
|
41,983
|
|
Weighted average amortization (years)
|
3.25
|
|
(In thousands)
|
|
2018
|
||
Balance, as of January 1 (Predecessor)
|
|
$
|
3,929
|
|
Liabilities incurred and assumed through acquisitions
|
|
553
|
|
|
Liabilities settled
|
|
(85
|
)
|
|
Accretion expense
|
|
104
|
|
|
Balance, as of July 30 (Predecessor)
|
|
$
|
4,501
|
|
|
|
|
||
Balance, as of July 31 (Successor)
|
|
$
|
—
|
|
Liabilities incurred and assumed through acquisitions
|
|
43,930
|
|
|
Liabilities settled
|
|
—
|
|
|
Accretion expense
|
|
391
|
|
|
Balance, as of September 30 (Successor)
|
|
44,321
|
|
|
Less: Current portion
|
|
(884
|
)
|
|
Long-term portion
|
|
$
|
43,437
|
|
(In thousands)
|
|
Successor
|
Predecessor
|
||||||||||||||||
|
|
July 31, 2018 through September 30, 2018
|
July 1, 2018
through
July 30, 2018
|
|
January 1, 2018 through
July 30, 2018
|
|
Three Months Ended September 30, 2017
|
|
Nine Months Ended September 30, 2017
|
||||||||||
Current:
|
|
|
|
|
|
|
|
|
|
||||||||||
Federal
|
|
$
|
—
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
State
|
|
45
|
|
631
|
|
|
1,461
|
|
|
81
|
|
|
848
|
|
|||||
|
|
45
|
|
631
|
|
|
1,461
|
|
|
81
|
|
|
848
|
|
|||||
Deferred:
|
|
|
|
|
|
|
|
|
|
||||||||||
Federal
|
|
3,493
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
State
|
|
—
|
|
135
|
|
|
324
|
|
|
549
|
|
|
1,119
|
|
|||||
|
|
3,493
|
|
135
|
|
|
324
|
|
|
549
|
|
|
1,119
|
|
|||||
Total provision
|
|
$
|
3,538
|
|
$
|
766
|
|
|
$
|
1,785
|
|
|
$
|
630
|
|
|
$
|
1,967
|
|
(In thousands)
|
|
Successor September 30, 2018
|
||
Revolving credit facility
|
|
$
|
—
|
|
6.0% Senior Notes due 2026
|
|
400,000
|
|
|
Total long-term debt
|
|
400,000
|
|
|
|
|
|
||
Less: unamortized deferred financing cost
|
|
(11,657
|
)
|
|
Total debt, net
|
|
$
|
388,343
|
|
|
|
Successor
|
||
(In thousands)
|
|
July 31, 2018 through
September 30, 2018
|
||
Basic:
|
|
|
||
Net Income attributable to Class A Common Stock
|
|
$
|
6,708
|
|
Weighted average number of common shares outstanding during the period
|
|
151,992
|
|
|
Net income per common share - basic
|
|
$
|
0.04
|
|
|
|
|
||
Diluted:
|
|
|
||
Net Income attributable to Class A Common Stock
|
|
$
|
6,708
|
|
Basic weighted average number of common shares outstanding during the period
|
|
151,992
|
|
|
Add: Dilutive effect of warrants
|
|
5,080
|
|
|
Diluted weighted average number of common shares outstanding during the period
|
|
157,072
|
|
|
Net income per common share - diluted
|
|
$
|
0.04
|
|
Net Minimum Commitments
(in thousands)
|
Remainder of 2018
|
2019
|
2020
|
2021
|
2022
|
Thereafter
|
Total
|
||||||||||||||
Purchase obligations
(1)
|
$
|
7,977
|
|
$
|
14,641
|
|
$
|
2,346
|
|
$
|
131
|
|
$
|
131
|
|
$
|
241
|
|
$
|
25,467
|
|
Operating lease obligations
(2)
|
109
|
|
436
|
|
274
|
|
44
|
|
—
|
|
—
|
|
863
|
|
|||||||
Service fee commitment
(3)
|
5,891
|
|
23,564
|
|
13,745
|
|
—
|
|
—
|
|
—
|
|
43,200
|
|
|||||||
Total Net Minimum Commitments
|
$
|
13,977
|
|
$
|
38,641
|
|
$
|
16,365
|
|
$
|
175
|
|
$
|
131
|
|
$
|
241
|
|
$
|
69,530
|
|
(1)
|
Amounts represent any agreements to purchase goods or services that are enforceable and legally binding and that specify all significant terms. These include minimum commitments associated with firm transportation contracts and frac sand commitments.
|
(2)
|
Amounts include long-term lease payments for compressors, vehicles and office space.
|
(3)
|
On the Closing Date, the Company and EVOC entered into a Services Agreement (the "Services Agreement"), pursuant to which EVOC, under the direction of the Company’s management, will provide the Company's services identical to the services historically provided by EVOC in operating the Acquired Assets, including administrative, back office and day-to-day field level services reasonably necessary to operate the business of the Company and its assets, subject to certain exceptions. As consideration for the services to be provided under the Services Agreement, the Company will pay EVOC a fixed annual services fee of approximately
$23.6 million
. The annual services fee may be (a) increased or decreased to account for asset acquisitions and dispositions of assets, (b) increased to account for an increase in the rig count attributable to the assets and (c) decreased if the Company must perform any of such services itself because EVOC is unable or fails to do so. The term of the Services Agreement is
five years
, but the Services Agreement is subject to termination by either party after
two years
.
|
•
|
the market prices of oil, natural gas, natural gas liquids (NGLs), and other products or services;
|
•
|
the supply and demand for oil, natural gas, NGLs, and other products or services;
|
•
|
production and reserve levels;
|
•
|
drilling risks;
|
•
|
economic and competitive conditions;
|
•
|
the availability of capital resources;
|
•
|
capital expenditure and other contractual obligations;
|
•
|
currency exchange rates
|
•
|
weather conditions;
|
•
|
inflation rates;
|
•
|
the availability of goods and services;
|
•
|
legislative, regulatory, or policy changes;
|
•
|
cyber attacks;
|
•
|
occurrence of property acquisitions or divestitures;
|
•
|
the integration of acquisitions;
|
•
|
the securities or capital markets and related risks such as general credit, liquidity, market, and interest-rate risks.
|
•
|
For the periods prior to July 31, 2018, the results of operations presented below reflect the results of solely the Predecessor when the Predecessor was not owned by the Company, and do not include the results of the Giddings Assets;
|
•
|
The results of operations of the Predecessor were not previously accounted for as the results of operations of a stand-alone legal entity, and accordingly have been carved out, as appropriate, for the periods presented. The results of operations of the Predecessor therefore include a portion of indirect costs for salaries and benefits, depreciation, rent, accounting, legal services, and other expenses. In addition to the allocation of indirect costs, the results of operations reflect certain agreements executed by the Karnes County Contributors for the benefit of the Successor, including price risk management instruments. These allocations may not be indicative of the cost of future operations or the amount of future allocations;
|
•
|
As a corporation, the Company is subject to federal income taxes at a statutory rate of 21% of pretax earnings whereas the Karnes County Contributors elected to be treated as individual partnerships for tax purposes. As a result, items of income, expense, gains and losses flowed through to the partners and were taxed at the partner level. Accordingly, no tax provision for federal income taxes is included in the financial statements of the Predecessor; and
|
•
|
On August 31, 2018, the Company completed the acquisition to purchase substantially all of the South Texas assets of Harvest Oil & Gas Corporation ("Harvest Acquisition") for approximately $133.3 million in cash and
4.2 million
newly issued shares of the Company’s Class A Common Stock. The Harvest Acquisition added an undivided working interest across a portion of the Company's existing Karnes County Assets and the existing Giddings Assets.
|
|
|
Successor
|
Predecessor
|
||||||||
(In thousands, except per unit data)
|
|
July 31, 2018 through
September 30, 2018
|
July 1, 2018
through
July 30, 2018
|
|
Three Months Ended September 30, 2017
|
||||||
PRODUCTION VOLUMES:
|
|
|
|
|
|
||||||
Oil (MBbls)
|
|
2,023
|
|
897
|
|
|
1,562
|
|
|||
Natural gas (MMcf)
|
|
5,047
|
|
1,153
|
|
|
2,094
|
|
|||
NGLs (MBbls)
|
|
642
|
|
160
|
|
|
337
|
|
|||
Total (MBoe)
|
|
3,506
|
|
1,249
|
|
|
2,248
|
|
|||
|
|
|
|
|
|
||||||
Average daily production volume:
|
|
|
|
|
|
||||||
Oil (Bbls/d)
|
|
33,164
|
|
28,935
|
|
|
16,978
|
|
|||
Natural gas (Mcf/d)
|
|
82,738
|
|
37,194
|
|
|
22,761
|
|
|||
NGLs (Bbls/d)
|
|
10,525
|
|
5,161
|
|
|
3,663
|
|
|||
Total (Boe/d)
|
|
57,475
|
|
40,290
|
|
|
24,435
|
|
|||
|
|
|
|
|
|
||||||
REVENUES:
|
|
|
|
|
|
||||||
Oil revenues
|
|
$
|
143,202
|
|
$
|
68,487
|
|
|
$
|
72,706
|
|
Natural gas revenues
|
|
14,201
|
|
3,646
|
|
|
6,925
|
|
|||
Natural gas liquids revenues
|
|
21,153
|
|
4,754
|
|
|
6,984
|
|
|||
Total revenues
|
|
178,556
|
|
$
|
76,887
|
|
|
$
|
86,615
|
|
|
|
|
|
|
|
|
||||||
AVERAGE PRICE:
|
|
|
|
|
|
||||||
Oil (per barrel)
|
|
$
|
70.79
|
|
$
|
76.35
|
|
|
$
|
46.55
|
|
Natural gas (per Mcf)
|
|
2.81
|
|
3.16
|
|
|
3.31
|
|
|||
NGLs (per barrel)
|
|
32.95
|
|
29.71
|
|
|
20.72
|
|
|
|
Successor
|
Predecessor
|
||||||||
(In thousands, except per unit data)
|
|
July 31, 2018 through
September 30, 2018
|
January 1, 2018 through
July 30, 2018
|
|
Nine Months Ended September 30, 2017
|
||||||
PRODUCTION VOLUMES:
|
|
|
|
|
|
||||||
Oil (MBbls)
|
|
2,023
|
|
5,755
|
|
|
5,176
|
|
|||
Natural gas (MMcf)
|
|
5,047
|
|
7,595
|
|
|
6,287
|
|
|||
NGLs (MBbls)
|
|
642
|
|
1,097
|
|
|
937
|
|
|||
Total (MBoe)
|
|
3,506
|
|
8,118
|
|
|
7,161
|
|
|||
|
|
|
|
|
|
||||||
Average daily production volume:
|
|
|
|
|
|
||||||
Oil (Bbls/d)
|
|
33,164
|
|
27,146
|
|
|
18,960
|
|
|||
Natural gas (Mcf/d)
|
|
82,738
|
|
35,825
|
|
|
23,029
|
|
|||
NGLs (Bbls/d)
|
|
10,525
|
|
5,175
|
|
|
3,432
|
|
|||
Total (Boe/d)
|
|
57,475
|
|
38,292
|
|
|
26,231
|
|
|||
|
|
|
|
|
|
||||||
REVENUES:
|
|
|
|
|
|
||||||
Oil revenues
|
|
$
|
143,202
|
|
$
|
399,124
|
|
|
$
|
240,778
|
|
Natural gas revenues
|
|
14,201
|
|
22,135
|
|
|
19,436
|
|
|||
Natural gas liquids revenues
|
|
21,153
|
|
27,927
|
|
|
18,002
|
|
|||
Total revenues
|
|
$
|
178,556
|
|
$
|
449,186
|
|
|
$
|
278,216
|
|
|
|
|
|
|
|
||||||
AVERAGE PRICE:
|
|
|
|
|
|
||||||
Oil (per MBbls)
|
|
$
|
70.79
|
|
$
|
69.35
|
|
|
$
|
46.52
|
|
Natural gas (per MMcf)
|
|
2.81
|
|
2.91
|
|
|
3.09
|
|
|||
NGLs (per MBbls)
|
|
32.95
|
|
25.46
|
|
|
19.21
|
|
|
|
Successor
|
Predecessor
|
||||||||
(In thousands)
|
|
July 31, 2018 through
September 30, 2018
|
January 1, 2018 through
July 30, 2018
|
|
Nine Months Ended September 30, 2017
|
||||||
Net cash provided by operating activities
|
|
$
|
90,678
|
|
$
|
284,812
|
|
|
$
|
193,124
|
|
Net cash used in investing activities
|
|
(761,891
|
)
|
(347,453
|
)
|
|
(255,646
|
)
|
|||
Net cash provided by financing activities
|
|
707,905
|
|
62,641
|
|
|
62,522
|
|
Contractual Obligations
(in thousands)
|
Note Reference
|
Total
|
Remainder of 2018
|
2019-2020
|
2021-2022
|
2023 & Beyond
|
||||||||||
On-Balance Sheet:
|
|
|
|
|
|
|
||||||||||
Debt, at face value
|
Note 9
|
$
|
400,000
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
400,000
|
|
Interest payments
(1)
|
Note 9
|
202,112
|
|
527
|
|
52,188
|
|
52,182
|
|
97,215
|
|
|||||
Off-Balance Sheet:
|
|
|
|
|
|
|
||||||||||
Purchase obligation
(2)
|
Note 13
|
$
|
25,467
|
|
$
|
7,977
|
|
16,986
|
|
263
|
|
$
|
241
|
|
||
Operating lease obligations
(3)
|
Note 13
|
863
|
|
109
|
|
710
|
|
44
|
|
—
|
|
|||||
Service fee commitment
(4)
|
Note 13
|
43,200
|
|
5,891
|
|
37,309
|
|
—
|
|
—
|
|
|||||
Total Contractual Obligations
|
|
$
|
671,642
|
|
$
|
14,504
|
|
$
|
107,193
|
|
$
|
52,489
|
|
$
|
497,456
|
|
(1)
|
Interest payments include cash payments and estimated commitments fees on long-term debt obligations.
|
(2)
|
Amounts represent any agreements to purchase goods or services that are enforceable and legally binding and that specify all significant terms. These include minimum commitments associated with firm transportation contracts and frac sand commitments.
|
(3)
|
Amounts include long-term lease payments for compressors, vehicles and office space.
|
(4)
|
On the Closing Date, the Company and EVOC entered into a Services Agreement, pursuant to which EVOC, under the direction of the Company’s management, will provide the Company's services identical to the services historically provided by EVOC in operating the Acquired Assets, including administrative, back office and day-to-day field level services reasonably necessary to operate the business of the Company and its assets, subject to certain exceptions. As consideration for the services to be provided under the Services Agreement, the Company will pay EVOC a fixed annual services fee of approximately
$23.6 million
. The annual services fee may be (a) increased or decreased to account for asset acquisitions and dispositions of assets, (b) increased to account for an increase in the rig count attributable to the assets and (c) decreased if the Company must perform any of such services itself because EVOC is unable or fails to do so. The term of the Services Agreement is
five years
, but the Services Agreement is subject to termination by either party after
two years
.
|
Exhibit
Number
|
|
Description
|
|
|
|
2.1*†
|
|
|
|
|
|
2.2*†
|
|
|
|
|
|
2.3*†
|
|
|
|
|
|
2.4*†
|
|
|
|
|
|
2.5*†
|
|
|
|
|
|
2.6**†
|
|
|
|
|
|
3.1*
|
|
|
|
|
|
3.2*
|
|
|
|
|
|
4.1*
|
|
|
|
|
|
4.2*
|
|
|
|
|
|
Exhibit
Number
|
|
Description
|
4.3*
|
|
|
|
|
|
4.4*
|
|
|
|
|
|
4.5*
|
|
|
|
|
|
4.6*
|
|
|
|
|
|
|
|
|
10.1*
|
|
|
|
|
|
10.2*
|
|
|
|
|
|
10.3*
|
|
|
|
|
|
10.4*
|
|
|
|
|
|
10.5*
|
|
|
|
|
|
10.6*
|
|
|
|
|
|
10.7*
|
|
|
|
|
|
10.8*
|
|
|
|
|
|
10.9*
|
|
|
|
|
|
10.10*
|
|
|
|
|
|
31.1**
|
|
|
|
|
|
31.2**
|
|
|
|
|
|
32.1***
|
|
|
|
|
|
Exhibit
Number
|
|
Description
|
32.2***
|
|
|
|
|
|
101.INS**
|
|
XBRL Instance Document
|
|
|
|
101.SCH**
|
|
XBRL Taxonomy Extension Schema Document
|
|
|
|
101.CAL**
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
101.DEF**
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
|
101.LAB**
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
|
|
101.PRE**
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
*
|
Incorporated herein by reference as indicated.
|
**
|
Filed herewith.
|
***
|
Furnished herewith.
|
†
|
Certain schedules and exhibits have been omitted pursuant to Item 601(b)(2) of Regulation S-K. A copy of any omitted schedule or exhibit will be furnished supplementally to the SEC upon request.
|
|
|
MAGNOLIA OIL & GAS CORPORATION
|
|
|
|
|
|
Date: November 13, 2018
|
|
By:
|
/s/ Stephen Chazen
|
|
|
|
Stephen Chazen
|
|
|
|
Chief Executive Officer (Principal Executive Officer)
|
|
|
|
|
Date: November 13, 2018
|
|
By:
|
/s/ Christopher G. Stavros
|
|
|
|
Christopher G. Stavros
|
|
|
|
Chief Financial Officer (Principal Financial Officer)
|
1.
|
Notwithstanding anything to the contrary in the Original Agreement, the Earnout Payments (as defined in Exhibit I of the Original Agreement) shall be an amount equal to $26,000,000, to be paid by or on behalf of Buyer (including through Magnolia Oil & Gas Operating LLC) by wire transfer in immediately available funds on the date hereof to the bank account(s) designated by Sellers. Upon receipt of such Earnout Payments, the Sellers waive any and all rights in the Original Agreement to any Earnout Payment in excess of the amount specified above.
|
2.
|
THIS AMENDMENT, THE ORIGINAL AGREEMENT AND THE ANNEXES, EXHIBITS AND SCHEDULES THERETO, THE CONFIDENTIALITY AGREEMENT AND THE TRANSACTION DOCUMENTS, COLLECTIVELY, CONSTITUTE THE ENTIRE AGREEMENT BETWEEN THE PARTIES PERTAINING TO THE SUBJECT MATTER HEREOF AND SUPERSEDE ALL PRIOR AGREEMENTS, UNDERSTANDINGS, NEGOTIATIONS, AND DISCUSSIONS, WHETHER ORAL OR WRITTEN, OF THE PARTIES PERTAINING TO THE SUBJECT MATTER HEREOF.
|
3.
|
This Amendment shall not constitute an amendment or waiver of any provision of the Original Agreement not expressly referred to herein. The Original Agreement, as amended by this Amendment, is and shall continue to be in full force and effect and is in all respects ratified and confirmed hereby.
|
4.
|
This Amendment may be executed in any number of counterparts, and each such counterpart hereof shall be deemed to be an original instrument, but all of such counterparts shall constitute for all purposes one agreement. Any signature hereto delivered by a Party by facsimile or other electronic transmission shall be deemed an original signature hereto. No Party shall be bound until such time as all of the Parties have executed counterparts of this Amendment.
|
5.
|
The applicable provisions of Section 1.2 (Construction) of the Original Agreement and Section 15.13 (Governing Law; Jurisdiction) of the Original Agreement shall apply
mutatis mutandis
to this Amendment.
|
Title:
|
Vice President - Transactions & Deputy General Counsel
|
Title:
|
Vice President - Transactions & Deputy General Counsel
|
Title:
|
Vice President - Transactions & Deputy General Counsel
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Magnolia Oil & Gas Corporation (the "registrant");
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
[Omitted];
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date: November 13, 2018
|
|
By:
|
|
/s/ Stephen Chazen
|
|
|
|
|
Stephen Chazen
|
|
|
|
|
Chief Executive Officer
(Principal Executive Officer)
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Magnolia Oil & Gas Corporation (the "registrant");
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
[Omitted];
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date: November 13, 2018
|
|
By:
|
|
/s/ Christopher G. Stavros
|
|
|
|
|
Christopher G. Stavros
|
|
|
|
|
Chief Financial Officer
(Principal Financial Officer)
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date: November 13, 2018
|
|
By:
|
|
/s/ Stephen Chazen
|
|
|
|
|
Stephen Chazen
|
|
|
|
|
Chief Executive Officer
(Principal Executive Officer)
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date: November 13, 2018
|
|
By:
|
|
/s/ Christopher G. Stavros
|
|
|
|
|
Christopher G. Stavros
|
|
|
|
|
Chief Financial Officer
(Principal Financial Officer)
|