Each one in plain English, with the numbers worked through for a shareholder.
6 Mar 2008director officer appointment▲ GoodMajor
Blast emerged from Chapter 11 with its shareholders intact -- the unusual outcome. A new convertible preferred issue paid every unsecured, administrative and priority claim in full, about $2.4 million, leaving $1.6 million of working capital; the company redomiciled to Texas and came out carrying only three secured obligations, the largest a $2.1 million interest-free Laurus claim repayable solely from litigation proceeds. It kept suing Quicksilver and Hallwood for a claimed $15-45 million.
Creditors and shareholders overwhelmingly approved Blast's Chapter 11 reorganization plan in bankruptcy court, though the company still needed to raise $3 million to actually exit bankruptcy.
Blast and Thornton Security Business Trust, a major shareholder, signed a mutual release clearing the Thornton entities' bankruptcy-related lawsuits against the company.
Blast (which filed Chapter 11 in January 2007 after the Laurus default) reached a bankruptcy settlement: Eagle's five land rigs and spare parts go to Laurus to satisfy the $40.6 million note, Blast repurchases 900,000 of its own shares from Second Bridge for $900, and Thornton Entities drop their lawsuits - effectively surrendering the drilling-rig business it bought a year earlier.
Blast Energy Services and its Eagle Domestic Drilling subsidiary filed for Chapter 11 in Houston. The August 2006 land-rig acquisition had been underwritten on five two-year drilling contracts; Hallwood and Quicksilver cancelled them within months, the senior lender declared default, and the company filed by agreement with that lender while suing both customers for breach.
Laurus Master Fund formally notified Blast of the loan default three days after the missed payment and said it intends to charge default penalties on top of the $40.6 million owed.
Just months after the Eagle acquisition, two major customers cancelled their drilling contracts, cutting revenue so sharply that Blast suspended interest payments on the $40.6 million Laurus loan secured by Eagle's rigs, triggering a default.
30 Aug 2006asset acquisition disposition▲ GoodMajor
Blast completed a $50 million cash-and-stock purchase of Eagle Domestic Drilling Operations, a Texas land-rig contractor with three producing rigs and three more under construction on Barnett/Fayetteville Shale contracts, funded mainly by a $40.6 million loan from Laurus Master Fund - a major pivot from jetting technology into contract land drilling.
After SEC comment, restated 2004 and 2005 financial statements to reflect a $3.2 million non-cash impairment of the carrying value of the Landers' License.
Alberta Energy accelerated the AFJ technology deal, assigning Blast full 50% ownership of the jetting technology immediately instead of the gradual step-up from 20% agreed in 2005.
Blast restated its FY2004 annual report and all three 2005 quarterly reports to record a $3.2 million non-cash write-down of its "Landers' License" intangible asset.
Blast Energy Services (PEDEVCO's predecessor) bought a 20% stake in Alberta Energy's abrasive fluid jetting (AFJ) drilling technology, with rights to grow to 50%, and agreed to license it worldwide as the base of a new energy-services line.
As Blast Energy Services (PEDEVCO's predecessor), financed its first abrasive-jetting rig with $1 million in loans from major shareholder Berg McAfee Companies, while a separate licensing counterparty, Maxim TEP, repeatedly defaulted and re-negotiated a required payment under escalating late fees — early signs of the financial fragility that led to Blast's 2007 Chapter 11 filing.
