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Arena Resources, Inc. Restates Financial
Statements to Reflect Accounting Change Associated
with Employee Options
Tulsa, Oklahoma — February 16, 2006
— Arena Resources, Inc. (AMEX: ARD, ARD.WS) ("Arena")
("Company") announced today that it is restating its
financial statements and amending its filings on Form
10-KSB for the years ended December 31, 2003 and 2004
and on Form 10-Q for the three quarters ended September
30, 2005, to reflect a change in how it accounts for
non-cash compensation expenses associated with options
granted to employees. The change essentially results
in the Company recognizing compensation expense related
to any discount of the exercise price of the option
from the market price of the stock at the date of the
grant, over the period in which the option vests. The
discount on all options granted through December 31,
2004 has been 15%, and the vesting period has been five
years.
The effect of this change is to reduce net income after
taxes by $139,355 (from $809,498 to $670,143) for the
year ended December 31, 2003, by $128,365 (from $2,580,017
to $2,451,652) for the year ended December 31, 2004
and by $59,635 (from $6,505,433 to $6,445,798) for the
nine months ended September 30, 2005. The adjustment
in diluted earnings per share is $0.02 for each of the
years ended December 31, 2003 and 2004 and $0.01 for
the nine months ended September 30, 2005.
About Arena Resources, Inc.
Arena Resources, Inc. is an oil and gas exploration,
development and production company with current operations
in Texas, Oklahoma, Kansas and New Mexico.
This
release contains forward-looking statements within the
meaning of the "safe-harbor" provisions of the Private
Securities Litigation Reform Act of 1995 that involve
a wide variety of risks and uncertainties, including,
without limitations, statements with respect to the
Company's strategy and prospects. Readers and investors
are cautioned that the Company's actual results may
differ materially from those described in the forward-looking
statements due to a number of factors, including, but
not limited to, the Company's ability to acquire productive
oil and/or gas properties or to successfully drill and
complete oil and/or gas wells on such properties, general
economic conditions both domestically and abroad, and
the conduct of business by the Company, and other factors
that may be more fully described in additional documents
set forth by the Company.
For further information contact:
K M Financial, Inc.
Bill Parsons
480-947-1589
k-m-financial@msn.com
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