<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)
NOTE 5. UNCONSOLIDATED AFFILIATES--(CONTINUED)
sold 3.75 million shares of its Tidewater common stock through an underwritten
public offering for a net price of $20.75 per share or $77.8 million; the sale
resulted in a pretax gain of $33.8 million. Additionally, in March 1994, Zapata
sold 375,175 shares of its Tidewater common stock for a net price of $21.34 per
share or $8.0 million resulting in a pretax gain of $3.6 million. These gains
are reflected on the statement of operations as other income. The Company now
owns 673,077 shares of Tidewater common stock all of which are reserved for the
possible exchange for $17.5 million of senior indebtedness held by Norex. See
Note 6.
NOTE 6. DEBT
At September 30, 1994 and 1993, Zapata's consolidated debt consisted of the
following:
<TABLE>
<CAPTION>
1994 1993
------- --------
(IN THOUSANDS)
<S> <C> <C>
Senior debt:
Norex senior secured notes due in 1996 at 13%................ $ $ 50,000
Norex senior convertible notes due in 1996 at 13%............ 34,234
Norex unsecured exchangeable notes due in 1996 at 8.5%....... 17,500 17,500
Texas Commerce Bank revolving/term credit facility for Energy
Industries, interest at prime or Eurodollar rates, 7.75% at
September 30, 1994, due in quarterly installments beginning
in 1997 through 1999, collateralized by certain compression
assets...................................................... 15,000
U.S. government guaranteed obligations:
Amounts due in installments through 2009, interest from
6.63% to 6.85%............................................ 7,961 8,276
Amounts due in installments through 2014, interest at
Eurodollar rates plus .45%, 5.51% at September 30, 1994... 1,588 --
Debt due in monthly installments through 1996, collateralized
by certain gas gathering systems, average interest at prime
plus 0.5% (8.25% and 6.5% at September 30, 1994 and 1993,
respectively)............................................... 3,775 6,371
Other debt at 7.7%........................................... 400 116
------- --------
46,224 116,497
------- --------
Subordinated debt:
10 1/4% debentures due 1997.................................... 15,621 15,621
10 7/8% debentures due 2001.................................... 10,242 10,242
------- --------
25,863 25,863
------- --------
Total Debt..................................................... 72,087 142,360
------- --------
Less current maturities........................................ 3,009 2,714
------- --------
Long-term debt................................................. $69,078 $139,646
======= ========
</TABLE>
The fair value of total long term debt at September 30, 1994 approximates
book value and at September 30, 1993 was estimated to be $144.7 million.
On May 17, 1993, Zapata completed certain financial transactions with Norex
Drilling Ltd. ("Norex Drilling"), a wholly owned subsidiary of Norex America,
Inc. ("Norex America" and collectively with Norex Drilling and other
affiliates, "Norex"), through which Zapata raised $111.4 million from the
issuance of debt and equity pursuant to a Second Amended and Restated Master
Restructuring Agreement dated as of April 16, 1993, as amended (the "Norex
Agreement"). The Norex Agreement enabled Zapata to refinance its then
outstanding senior debt and substantially reduce the amount of required debt
service payments for the following two years.
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