Chaparral Energy, Inc.

Chaparral Energy, Inc. terminated the registration of a class of securities, ending its reporting obligation for them.

listing compliance notice

Chaparral Energy, Inc.'s exchange filed to remove a class of its securities from listing.

listing compliance notice

On August 17, 2020, the NYSE began delisting proceedings against Chaparral's common stock because of the Chapter 11 filing and suspended trading that day; the company will not appeal. The stock began being quoted over-the-counter on August 18, with no assurance that it continues. The company warns shareholders could see a significant or complete loss. This follows the earlier price-based NYSE notices and the restructuring plan.

listing compliance notice

After the forbearance period, Chaparral signed a Restructuring Support Agreement on August 15, 2020 with holders of about 78% of its bank loans and about 78% of its 8.75% senior notes, to be carried out through a prepackaged Chapter 11 plan in Delaware (the filing's dates indicate the cases were filed August 16). The roughly $300 million of senior notes would convert into 100% of the new common stock, subject to dilution, with rights to join a fully backstopped $35 million convertible note offering, and bank lenders would get cash and new loans under a $300 million exit facility. All existing common stock would be cancelled with no distribution on it, but holders who do not object to the plan or opt out of releases would share $1.2 million of cash plus warrants (or $0.01508 per share for certain holders who do not hold through DTC). The company's own advisor values the reorganized equity at $70-160 million, below the $300 million and $350 million warrant strike prices, and the warrants would lose value in a sale or merger. Strategic Value Partners also gave up its two board designees and agreed not to oppose the plan.

bankruptcy or receivership

Chaparral chose not to make the $12.5 million (plus interest) borrowing base deficiency payment due August 3, 2020, which is an event of default under both the credit agreement and the senior notes indenture. This is the missed payment the earlier forbearance deals anticipated. The lender forbearance runs to August 9 (extendable to August 14) and the noteholder forbearance and waiver runs to August 14, so lenders and noteholders are holding off on remedies for now.

debt financing

The company says the July 31 hedge milestone was met: all hedges were unwound and part of the proceeds repaid credit facility borrowings (the filing gives no amount). A Second Amendment on July 29 extended the bank forbearance from July 29 to August 9, extendable by agreement to August 14. On July 30 holders of at least 75% of the senior notes agreed to forbear and waive default over the $12.5 million August deficiency payment, but not over the roughly $13.1 million interest payment, which is still unpaid with its grace period ending August 14. Restructuring talks with lenders and noteholders continue.

debt financing

Continuing the July 15 forbearance with its bank lenders, Chaparral's lenders approved the plan to unwind its hedges on July 22. A First Amendment effective July 24 requires the company, by 3:00 p.m. Eastern on July 31, to unwind all hedges and use proceeds to repay part of the credit facility. If net proceeds are $33 million or less, the repayment is $24 million or the total proceeds, whichever is less; above $33 million, it is the amount over $9 million. This repayment cannot count toward the remaining borrowing base deficiency payments, including the $12.5 million due by August 2, and the hedge unwind will not automatically cut the borrowing base.

debt financing

On July 15, 2020 Chaparral chose not to pay a roughly $13.1 million interest payment on its 8.75% senior notes due 2023; the 30-day grace period ends Aug 14, 2020. Its bank lenders agreed to hold off on remedies until July 29, 2020, subject to milestones including a plan to unwind hedges and pay down loans, with default-rate interest meanwhile. The company says it is discussing a comprehensive restructuring of its debt with lenders and noteholders.

debt financing

On April 2, 2020 Chaparral drew $90 million on its credit facility as a precaution, raising debt to $250 million and cash to $109.9 million. That night lenders cut the borrowing base from $325 million to $175 million, creating a $75 million deficiency. The company must propose a fix by April 16, possibly six monthly installments starting with $12.5 million by May 2, and missing repayment would be a default.

debt financing

On Nov 11, 2019 the NYSE told Chaparral its shares had averaged below $1.00 over 30 trading days, breaching the minimum price rule. It has six months to cure, and the stock stays listed meanwhile with a .BC marker. The company says business operations and debt agreements are not affected.

listing compliance notice

On Dec 7, 2018 Chaparral amended its Tenth Restated Credit Agreement: Royal Bank of Canada replaced JPMorgan as agent, the facility rose from $400 million to $750 million, the borrowing base from $265 million to $325 million, and pricing fell by 50 basis points. The press release says there were no borrowings outstanding and the next redetermination is spring 2019; this continues the semi-annual redetermination thread.

debt financing

Chaparral's Class A common stock began trading on the New York Stock Exchange on July 24, 2018 under the ticker "CHAP", leaving the OTCQB market where it had traded as CHPE. The Stockholders Agreement dated March 21, 2017 (from the post-bankruptcy equity structure), as amended March 6, 2018, ended automatically with the uplisting. This follows the NYSE listing clearance reported on July 23.

security holder rights change

the exchange certified Chaparral Energy, Inc.'s securities for listing, clearing them to begin trading.

listing compliance notice

On Dec 21, 2017 Chaparral replaced its credit agreement with a Tenth Restated Credit Agreement with JPMorgan: a $400 million reserve-based revolver due Dec 21, 2022, with an initial borrowing base of $285 million (up from $225 million). It must keep Total Debt to EBITDAX at or below 4.00x. On Dec 22 it also agreed to buy Kingfisher County, Oklahoma properties from two private sellers for about $34.7 million and $23.8 million in cash, to be funded from the credit facility, with closing expected by Jan 5, 2018.

debt financing

On Nov 17, 2017 Chaparral closed the sale of its EOR assets (including North Burbank) to Perdure Petroleum for $170 million, subject to adjustments, plus contingent payments; preliminary estimates put proceeds received at $163.4 million. The assets produced about 5,700 Boe/day and made up 51% of proved reserves at Sept 30, 2017. Proceeds fully repaid the $149.2 million term loan and will repay part of the credit facility, and the $225 million borrowing base was confirmed. This completes the sale announced Oct 13 and, per the company, the move to a STACK-focused business.

asset acquisition disposition

On Oct 13, 2017 Chaparral's subsidiaries agreed to sell their North Burbank and Texas Panhandle enhanced oil recovery assets to Perdure Petroleum for about $170 million cash plus contingent payments (through December 2020, per the press release), with closing expected in November 2017. An $11.9 million deposit has been received. The company says this moves it toward being a pure-play STACK operator and that proceeds will reduce debt; those are management's statements.

material agreement

On March 10, 2017 the bankruptcy court confirmed Chaparral's reorganization plan. All existing common stock (1,392,706 shares held by 19 record holders as of Mar 8, 2017), plus options and warrants, will be cancelled on the effective date, and 100% of the new equity (subject to dilution) goes to noteholders, general unsecured and royalty litigation claimants. The bank debt will be cut by a cash payment and the remainder restructured into a four-year facility of a $225 million first-out revolver and $150 million second-out term loan. Noteholders will get about 9% of new equity for $50 million through a rights offering, backstoppers about 1%, and management up to 7% via an incentive plan. A new seven-person board takes office on the effective date, targeted before end of March 2017 but not assured. This resolves the open question of the Chapter 11 outcome and of old shareholders' treatment: they are wiped out.

bankruptcy or receivership

On Dec 14, 2016 the bankruptcy court approved the plan support agreement with certain noteholders and revolver lenders, and on Dec 19 Chaparral filed its proposed reorganization plan and disclosure statement, consistent with that agreement. A disclosure statement hearing is set for Jan 24, 2017, and the company expects to ask for a confirmation hearing in March 2017. This moves the Chapter 11 case from negotiation to a formal plan; the filing does not describe what existing shareholders receive.

bankruptcy or receivership

On May 9, 2016 Chaparral and its subsidiaries filed voluntary Chapter 11 petitions in Delaware and will keep operating as debtors-in-possession. The filing accelerated the revolver and the 9.875% 2020, 8.25% 2021 and 7.625% 2022 notes, but enforcement is stayed. The company says it is negotiating a debt-for-equity exchange with bondholders and lenders aiming to cut bondholder debt by about $1.2 billion. This follows the missed interest payments and forbearance in April. The filing does not state what happens to existing shareholders, so their outcome is not yet determined.

bankruptcy or receivership

Chaparral did not pay interest on its 8.25% Senior Notes due March 1, 2016, and the 30-day grace period expired, so an event of default occurred on April 1, 2016 ($384 million outstanding). This triggered a cross default under the revolver ($548 million drawn). It also skipped a $14.8 million interest payment on the 9.875% Senior Notes ($298 million outstanding), which becomes a default if unpaid within 30 days. Noteholders (8.25%, 9.875%, 7.625% notes) and revolver lenders agreed to hold off enforcing remedies until the earliest of April 15, 2016 or other termination events. The agreements are dated April 4, 2015 in the text, which looks like a typo for 2016 (inference).

debt financing

On Feb 11, 2016 Chaparral borrowed $141.0 million under its revolving credit facility, substantially all of the remaining undrawn amount, bringing borrowings to $548.0 million plus $828,000 of letters of credit. The funds are for general corporate purposes. It also hired Evercore and Latham & Watkins to advise on financial, transactional and strategic alternatives. The filing does not say why the borrowing was made; the hiring of advisers alongside it points to financial stress (inference).

debt financing

On July 18, 2014 Chaparral closed the sales of its Ark-La-Tex and Central Basin properties to RAM Energy, for net cash proceeds of $48.5 million and $45.9 million. Four of five packages are now sold, for $249.8 million gross ($244.5 million net of closing adjustments), subject to further adjustments within 90 days. Proceeds paid down the revolver and the borrowing base fell from $532.0 million to $484.5 million. The Gulf Coast package is still being marketed. The Central Basin price is given as $48.6 million here versus about $48.1 million in the May agreement; the filing does not explain the difference.

asset acquisition disposition

Chaparral closed two divestitures: the Delaware Basin package to Scout Energy (May 18, 2014, $25.2 million) and the Ft. Worth Basin package to RKI (May 23, 2014, $125.0 million), net of adjustments. Proceeds paid down the revolver, and the borrowing base fell from $600.0 million to $532.0 million. This completes the April agreements. It also agreed on May 30 to sell its Central Basin properties (Texas and southeast New Mexico, about 600 BOE a day) to RAM Energy for about $48.1 million, expected to close around July 25, 2014, which would cut the borrowing base to $484.5 million. The Ark-La-Tex sale ($51.0 million) is still expected around June 26.

asset acquisition disposition

On May 19, 2014 Chaparral signed a Limited Consent and Fourteenth Amendment to its credit agreement so the lenders approve the asset sales. Lenders waived hedging-covenant breaches that the sales could cause (hedging over 100% of production) until the earlier of delivery of the Q2 2014 10-Q or Aug 15, 2014, with conditions. If the conditions are not met, Chaparral may have to unwind some hedges. The borrowing base falls automatically as each of the five packages closes, from $600.0 million to $478.0 million if all five close as planned.

material agreement

On Apr 25, 2014 Chaparral agreed to sell its Ark-La-Tex properties to RAM Energy for about $51.0 million cash. They produce about 1,000 BOE a day, 82% natural gas, and closing is expected around June 26, 2014. Chaparral keeps the deep rights (Eagle Ford and below) in seven counties and will market them separately. With the two earlier agreements, expected proceeds from three packages are $201.2 million, and two packages remain to be sold.

material agreement

On Apr 10, 2014 Chaparral disclosed that its Board approved selling its Ark-La-Tex, Permian Basin, Gulf Coast and North Texas properties in five packages to focus on the Mid-Continent. This follows the Oct 2013 news that a banker was hired for non-core sales. Two agreements, with Scout Energy Group I (Apr 3) and RKI Exploration & Production (Apr 8), cover the Delaware Basin and Eastern Shelf/Ft. Worth Basin properties (about 2,300 BOE a day) for roughly $150.2 million cash, with about $15.0 million in deposits received. Closing is expected before May 22, 2014, and three packages are still being sold.

material agreement

On Dec 18, 2013 Chaparral's subsidiary completed the Cabot Oil & Gas purchase of about 66,000 net acres in Beaver and Texas counties, Oklahoma, and Ochiltree county, Texas, for approximately $153 million, subject to post-closing adjustments. This is lower than the $160.128 million in the Oct 11 agreement; the filing does not explain the difference (adjustments were allowed for). Financial statements and pro forma information for the acquisition will follow by amendment by March 5, 2014.

asset acquisition disposition

On Oct 11, 2013 a Chaparral subsidiary agreed to buy oil and gas assets from Cabot Oil & Gas: about 66,000 net acres in Beaver and Texas counties, Oklahoma, and Ochiltree county, Texas, for $160.128 million before adjustments, with closing expected by Dec 18, 2013. Chaparral also said it has hired an investment banker to sell non-core assets in its Ark-La-Tex and Permian Basin areas; no buyer, price or timing is given in the filing.

material agreement

On Nov 15, 2012 Chaparral closed the $150 million add-on of 7.625% senior notes due 2022 agreed on Nov 2, bringing the series to $550 million (calculated from $400 million issued May 2 plus this $150 million). The press release says the notes were priced at 104.5% of face (yield to worst 6.846%), and proceeds are meant to repay revolving credit facility debt and for general purposes; the filing gives no repayment amount. Chaparral also agreed to seek a registered exchange offer within 270 days. This resolves the open question of whether the add-on closed.

debt financing

On Nov 1, 2012 Chaparral signed a Tenth Amendment to its credit agreement, raising the borrowing base from $375 million to $500 million, extending maturity to Nov 1, 2017 and lowering interest margins (Eurodollar 1.50%-2.50%, ABR 0.50%-1.50%). On Nov 2 it agreed to sell $150 million of additional 7.625% notes due 2022 to initial purchasers led by Wells Fargo Securities, with proceeds intended to repay $145 million under the credit agreement and for general purposes. This adds to the $400 million of 2022 notes from May, bringing them to $550 million in total (calculated from the filing's figures). The earlier borrowing base was last stated as $375 million in April 2011.

material agreement

On May 2, 2012 Chaparral closed the $400 million 7.625% senior unsecured notes due Nov 15, 2022, priced at par. It received the required consents for its $325 million 8.875% notes due 2017 and signed a supplemental indenture removing most of their covenants. It also announced redemption of all 2017 notes left after the tender. This follows the April 18 purchase agreement; the filing states the proceeds are intended for the 2017 tender and redemption and general purposes, but gives no final tendered amount. A registered exchange offer is promised within 270 days.

debt financing

On April 18, 2012 Chaparral agreed to sell $400 million of 7.625% senior notes due 2022 to initial purchasers led by Credit Suisse. The proceeds are intended to fund a tender offer and consent solicitation for, or redemption of, its 8.875% senior notes due 2017, plus general purposes. It also signed a Seventh Amendment (April 17) to its Eighth Restated Credit Agreement raising permitted additional debt by $75 million, and hired Credit Suisse as dealer manager. This repeats the 2011 pattern of refinancing the 2015 notes, now aimed at the 2017 notes; the filing states intent, not final tender results or the interest saving.

material agreement

On April 1, 2011 Chaparral amended its Eighth Restated Credit Agreement, extending maturity from April 12, 2014 to April 1, 2016 and reaffirming the $375 million borrowing base. Interest margins on Eurodollar loans fall from 2.50%-3.50% to 1.75%-2.75%, and on ABR loans from 1.625%-2.625% to 0.75%-1.750%. The total debt to EBITDAX covenant is removed, the net debt covenant is set at 4.50x through Dec 31, 2011 and 4.25x from March 31, 2012, and the cap on hedged volumes in the first year rises from 85% to 90% of projected proved developed producing production. This is cheaper and longer secured borrowing on the facility that replaced the older credit agreement.

material agreement

On Feb 22, 2011 Chaparral closed the $400 million 8 1/4% senior unsecured notes due Sept 1, 2021, priced at par, with the first interest payment on Sept 1, 2011. Proceeds are to buy back any and all of the $325 million 8 1/2% notes due 2015 via the tender offer, redeem any left over, and cover general purposes. Holders gave the required consents, and a supplemental indenture removed most covenants and some default provisions on the 2015 notes. A redemption of any remaining 2015 notes was announced. This completes the refinancing begun Feb 7; the notes carry a 101% change-of-control put and a registered exchange offer within 270 days. The filing states intent to use the proceeds, not final tender results.

debt financing

On Feb 7, 2011 Chaparral agreed to sell $400 million of 8.25% senior notes due 2021 to initial purchasers led by Wells Fargo Securities. The net proceeds are intended to fund a tender offer and consent solicitation for, or redemption of, its 8.5% senior notes due 2015. It also signed a Third Amendment to its Eighth Restated Credit Agreement raising permitted additional debt by $50 million, and hired Wells Fargo as dealer manager for the tender. This starts the refinancing of the 2015 notes; the filing lists a Second Amendment dated Jan 11, 2011 as an exhibit without describing it.

material agreement

Chaparral sold $300 million of 9 7/8% senior unsecured notes due October 1, 2020 (purchase agreement Sept 13, closed Sept 16, 2010) through J.P. Morgan Securities in a private placement. About $287.0 million of net proceeds is meant to repay the roughly $206.0 million outstanding on its secured credit facility, with the rest for general purposes. The facility's borrowing base is reduced to $375.0 million from $450.0 million, and the company can reborrow under it. The notes rank equally with the 2015 and 2017 notes and carry a 101% put on certain changes of control; Chaparral also agreed to offer a registered exchange for them within 270 days.

debt financing

On March 23, 2010 Chaparral agreed to sell CCMP 475,042 class E common shares and one class F share for $325.0 million, after the failed United deal. Closing depends on a new credit facility, a new stockholders agreement, a restated charter, employment agreements for senior management and a new equity incentive plan. Fischer and Altoma also each agreed to sell CCMP $10.0 million of stock, and CCMP is expected to own about 37% of the common stock afterward. The new charter creates classes A through G, lets classes B, C and D name three of five directors and class E the other two, requires class B consent to a company sale before the sixth anniversary, and gives class E consent rights over certain debt and asset actions. Existing holders are diluted by the new issuance (inference from the share sale).

capital raising announcement

Chaparral and United signed a letter agreement on December 11, 2009 terminating the October 9 merger agreement (as amended November 23), after the deal did not get the required vote at United's December 11 special meeting. Each side released claims against the other. This ends the route to public markets via United, as the earlier Edge deal ended in 2008, and Chaparral stays privately owned; the filing does not say what comes next.

material agreement termination

On November 23, 2009 Chaparral, United and Merger Sub amended the merger agreement on terms less favourable to Chaparral's holders. Closing shares fall from 58,000,000 to 51,500,000, and contingent shares fall from 20,000,000 to 10,000,000, all issued at closing into escrow. The escrowed shares are released only if Chaparral stays in compliance with its credit facility covenants for the prior 12 months and the stock averages above $15.00 for 30 of 60 trading days within six years of closing. The sponsor also cancels 4,167,500 shares, its escrowed shares drop from 5,625,000 to 2,812,500, and the incentive plan reserve rises from 7,500,000 to 8,900,000 shares. The press release puts the revised upfront deal value at about $1.7 billion and moves the warrant redemption price from $0.50 to $0.55.

material agreement

On October 9, 2009 Chaparral agreed to merge with United Refining Energy Corp., a blank-check company, with Chaparral surviving as a wholly owned subsidiary of United. Chaparral stockholders would receive 58,000,000 United common shares plus 20,000,000 contingent shares (5,000,000 escrowed at closing for indemnification and a share-price target; 15,000,000 tied to trading price benchmarks within three years; 5,000,000 tied to an EBITDA target within five years). The deal is valued at about $1.8 billion, and United's trust cash available to Chaparral is to be no less than $250 million after specified costs. Chaparral's board and stockholders have approved, and United stockholders must also approve. This replaces the failed Edge route as Chaparral's path to being publicly traded.

material agreement

Chaparral settled early all of its 2012 and 2013 oil swaps and collars with JPMorgan ($49.4 million), RBS ($40.0 million) and Calyon ($13.0 million), as permitted under the Fifth Amendment. Per that amendment, about $87.0 million (85% of proceeds) will repay credit facility debt, with the borrowing base reduced by the same amount; the rest is for general corporate purposes. This carries out the derivative monetization approved in May 2009. It also means those 2012-2013 hedges no longer protect future production; the table shows remaining hedges run through 2011.

material agreement termination

Chaparral signed a Fifth Amendment to its credit agreement effective May 21, 2009, reaffirming the $600 million borrowing base until the next redetermination on November 1, 2009. It also allowed monetizing 2012 and 2013 oil derivatives (cutting the borrowing base by 85% of net proceeds) and using certain asset-sale, equity or derivative proceeds to buy back its bonds, provided Excess Available Cash stays above $75 million. Borrowing costs rise (LIBOR margins to 2.500%-4.250%), capital spending for April 1 to December 31, 2009 is limited to discretionary cash flow, and the debt covenant is reset to 3.00x stepping down to 2.50x. A 0.375% amendment fee was paid.

material agreement

Chaparral signed a Fourth Amendment to its credit agreement with JPMorgan and other lenders on December 24, 2008, reaffirming its $600 million borrowing base. It plans to draw the remaining availability, up to $596 million, before year end to increase liquidity, because its bond indenture has an annual debt-incurrence covenant that could limit borrowing in early 2009. Interest will be LIBOR plus 2.75% (minimum 4.75%), and the next redetermination is May 1, 2009. Lenders also approved selling some derivatives that would settle January to June 2009 for an estimated $31 million to $34 million. This follows the failed Edge merger and means the credit facility is expected to be nearly fully drawn.

material agreement

Chaparral and Edge Petroleum signed an agreement on December 16, 2008 to terminate their July 14, 2008 merger, after concluding it was highly unlikely the closing conditions would be met by December 31, 2008. The filing says Chaparral was also highly unlikely to get a new senior secured credit facility or satisfy the conditions for the Series B sale, and the parties could not secure alternative financing. Magnetar's $150 million Series B purchase agreement was terminated too, with Magnetar paying Chaparral $5.0 million (of which $1.5 million goes to Edge for expenses), and the JPMorgan/RBS/SunTrust financing commitment was also terminated. Magnetar also received an option, expiring June 30, 2009, to invest up to $25 million in Chaparral common stock at a $900 million pre-money valuation. This ends the Edge merger and the planned dilution from the Series B preferred.

material agreement termination

Chaparral filed a registration statement to issue shares to Edge holders in the planned merger. After closing, existing Chaparral holders would own about 86% of the common stock and former Edge holders about 14%, and Chaparral's common and Series A preferred are expected to be listed on the NYSE. The filing says the merger would make Chaparral a publicly traded company. It registers up to 29,786,650 common shares and 2,875,000 Series A preferred shares, and is a preliminary draft with the meeting date still blank.

business combination

On July 14, 2008 Chaparral agreed to acquire Edge Petroleum in an all-stock merger: each Edge common share converts into 0.2511 Chaparral shares, and Edge's 5.75% Series A preferred converts one-for-one into a matching Chaparral preferred. Separately, Chaparral agreed to sell 1,500,000 shares of new Series B convertible preferred to Magnetar for $150 million, closing only if the merger closes; it is initially convertible into 6,827,492 common shares at $21.97, so existing holders would be diluted. Either side owes a $15 million termination fee in specified cases, and the merger needs Edge common stockholder approval; Chaparral's board and stockholders have already approved it.

business combination

Chaparral sold $325 million of new 8 7/8% Senior Notes due February 1, 2017 to initial purchasers led by JPMorgan Securities (agreement January 10, 2007; completed January 18, 2007). It intends to use the proceeds to pay down its senior secured credit facility, which it may borrow on again. The notes rank equally with the existing 8 1/2% notes due 2015 and are unregistered, with Chaparral promising to complete a registered exchange offer within 270 days. This adds a second $325 million of notes rather than replacing the first; the filing says the proceeds go to bank debt, not that total debt falls by that amount.

debt financing

Chaparral closed the Calumet, JMG Oil & Gas and J.M. Graves L.L.C. acquisition on October 31, 2006, at an amended price of $500 million (down from the $510 million agreed in September), with up to $17 million more if certain tax elections are made. It paid for it with a new $750 million credit facility led by JPMorgan (maturing October 31, 2010) and the $102 million from the Chesapeake share sale; after closing it had $629 million drawn, up from $201 million at September 30, 2006. The new facility replaces the earlier credit agreement, and the borrowing base steps down to $700 million on February 1, 2007 and $610 million on May 1, 2007. Calumet, JMG Oil & Gas and CEI Pipeline were also added as guarantors of the 8 1/2% Senior Notes due 2015.

asset acquisition disposition

The Chesapeake share sale closed on September 29, 2006: Chesapeake bought 280,000 shares (after a 775-for-1 stock split), 102,000 from Chaparral for $102 million and 178,000 from the selling holders for $178 million. Of the latter, $40 million was paid to Altoma in 1,375,989 Chesapeake shares. The Stockholders Agreement was signed at closing. This completes the deal announced September 1 and provides the cash Chaparral planned to use toward the pending Calumet purchase.

capital raising announcement

Chaparral agreed to buy Calumet Oil Company, JMG Oil & Gas, LP and its general partner for $510 million in cash (up to $17 million more if certain tax elections are made). It plans to fund this by raising its revolving credit facility to up to $750 million and with the roughly $102 million from the Chesapeake share sale. The company's press release says the deal adds 4,600 barrels of oil equivalent per day and internally estimated proved reserves of 309 Bcfe, including the North Burbank Unit (about 99% working interest). Closing is expected on or after October 31, 2006, subject to diligence by Chaparral and its lenders.

material agreement

Chaparral agreed to sell shares to Chesapeake Energy, which would own about 32% of the company after the deal at $775,000 per pre-split share. Chaparral itself sells shares for $102 million and existing holders (Altoma and Fischer Investments) sell shares for $178 million. A Stockholders Agreement gives the parties board nomination rights and sets an effort to complete a qualified IPO before August 15, 2011. Chesapeake agrees not to exceed 35% ownership without board approval. New shares were issued, so existing holders' stakes are diluted; closing was expected on or after September 22, 2006.

capital raising announcement