9 Aug 2010listing compliance notice▼ BadMajor
Velocity Energy Inc. deregistered its securities, ending its obligation to file reports with the SEC.
Announcements, explained
Each one in plain English, with the numbers worked through for a shareholder.
17 Nov 2009late filing notice▼ Bad
Velocity Energy Inc. notified the SEC that its quarterly report would be filed late.
9 Oct 2009asset acquisition disposition▲ GoodMajor
The West Virginia deal with Classic Oil & Gas Resources closed October 2, 2009, but on smaller terms than the April letter: 91 gas wells producing over 2,000 Mcf/d across about 13,500 acres for about $1.2 million (50% at closing, balance due one year later), versus more than 100 wells for about $5 million. The company also gets a farmout to develop 60 drilling locations and the right to join over 40 more wells; Classic's reserve report shows 35,000 MMcf gross proved, and the company estimates over 10,000 MMcf net. The senior lender agreed to subordinate its interest in the Classic properties, and Marquis and Summerview received a 3% overriding royalty on them (2.3948% and 0.6052%). A $584,823.50 note went to Classic.
14 Aug 2009substantial holder notice● Neutral
The Longview Fund, L.P, Longview Fund International, Ltd, Viking Asset Management, Ltd, Viking Asset Management, LLC, Peter Benz reported a Velocity Energy Inc. shareholding of 26,367,104 shares (93.20% of votes) in a periodic institutional filing.
29 July 2009material agreement● NeutralMajor
On July 27, 2009 the company and Longview signed a share exchange agreement, effective November 1, 2008, formalising the November 2008 restructuring ($1,000,000 payment, $2,210,550.92 subordinated note, cancellation of warrants over 3,000,000 shares). Longview, which held 23,182,876 shares (87.99%), swapped 20,000,000 common shares for 20,000,000 Series A Convertible Preferred shares valued at $1.20 each ($24,000,000), convertible one-for-one into common, with no dividends and no votes except as the designation provides. The 20,000,000 common shares were retired, so common outstanding falls while the preferred can convert back into common. The preferred was not previously in the context; it carries a $1.20 liquidation value ahead of or alongside common holders (inference).
22 June 2009debt financing▼ BadMajor
This amendment corrects the June 19 report: the Marquis note increase is $1,644,375 (not $1,664,375) for the $1,500,000 paid, giving a new note of $6,647,126.98. It also adds that on March 31, 2009 the company prepaid $2,000,000 on the senior note, which cut principal by $2,192,500, leaving $6,682,500 on May 29 before the Summerview transfer. The $1,500,000 is to be used solely for an agreed acquisition. Item 2.04 is added to flag the increased obligation.
19 June 2009material agreement▼ BadMajor
On June 17, 2009 the company amended the Marquis senior secured note deal: Marquis paid $1,500,000, the note principal rises, and a new note of $6,647,126.98 is to be issued, with the money used only for an agreed acquisition. Earlier, on May 29, 2009, Marquis had transferred $1,679,842.02 of the note to Summerview Marquis Fund, leaving Marquis $5,002,751.98. This adds to the November 2008 senior debt rather than reducing it. The filing's stated increase ($1,664,375) was corrected in the next amendment.
18 May 2009late filing notice▼ Bad
Velocity Energy Inc. notified the SEC that its quarterly report would be filed late.
17 Apr 2009material agreement● NeutralMajor
On April 13, 2009 the company, through subsidiaries Velocity Energy Partners LP and Velocity Energy Limited LLC, signed a binding letter of intent with Classic Oil & Gas Resources to buy more than 100 producing gas wells in five southern West Virginia counties (about 13,500 acres, 2,500 Mcf/d) for roughly $5 million, targeting a close by May 31, 2009. This is a new line of business in West Virginia, separate from the Texas Matagorda Bay assets. The attached letter shows the price includes about $2.9M base cash, $1.3M in well-location fees and $350,000 for oilfield assets, plus overriding royalties and consulting payments to the sellers, with the buyer assuming a Bank of Mingo loan. The truncated text does not show how the purchase is funded.
1 Apr 2009late filing notice▼ Bad
Velocity Energy Inc. notified the SEC that its annual report would be filed late.
29 Jan 2009auditor change● Neutral
Effective January 26, 2009 Sonterra engaged Hein & Associates LLP as its new auditor, approved by an audit committee formed December 31, 2008. Hein's first report will cover the year ended December 31, 2008. This fills the vacancy left by Akin's December resignation; the filing reports no disagreements or prior consultation.
31 Dec 2008auditor change▲ GoodMajor
Akin, Doherty, Klein & Feuge resigned as auditor effective December 29, 2008, only about seven months after being appointed. The filing says its reports had no adverse opinion or going-concern-type qualification and there were no disagreements. The same filing carries a press release saying the State Tract 127-1 well reached 12,464 feet with gas and oil pay zones and is to be brought on line in January 2009, and that the sidetrack well at State Tract 150-1 tested 785 MCF/day of gas and 120 barrels/day of condensate, with production expected in early January. This is the first reported result of the 2008 drilling program.
10 Dec 2008asset acquisition disposition▼ BadMajor
This amendment restates the November 13, 2008 Longview/Marquis transaction report with more detail and full exhibits. It adds that Longview held about 91% of the stock (about 93% with an affiliated fund), that the Senior Secured Note matures November 13, 2011 and starts monthly repayments in August 2009, and that failing certain production and reserve-ratio tests would trigger extra payments and a higher interest rate. It also adds that on December 4, 2008 up to $1,300,000 of the acquisition funds were agreed to be released for a well operated with STO Operating Company ($927,346 released December 8), with a new overriding royalty to Marquis of 7% on that well, falling to 3% once Marquis receives $250,000.
20 Nov 2008asset acquisition disposition▼ BadMajor
On November 13, 2008 Sonterra restructured its debt with Longview and an affiliated fund, Longview Marquis Master Fund (Marquis). Longview gave up the $3,000,000 of senior secured notes (the Feb and May 2008 notes) and warrants over 3,000,000 shares. In return it received a $2,210,550.92 unsecured subordinated note and $1,000,000 in cash. Marquis received a $9,440,000 subordinated note and a 1,000,000-share warrant at $0.01, in exchange for North Texas Drilling Services, Inc. (three onshore drilling rigs) and a $8,575,000 note on it. Marquis also bought a new $8,875,000 senior secured note at 13% (for $8,075,000), with a 1,050,000-share warrant at $0.01 and a 3% overriding royalty on the company's oil and gas properties. The new senior note is secured on substantially all assets and matures 36 months after closing; the subordinated notes can be partly repaid in shares at $4.00. This replaces the Longview facility from the earlier context, adds debt and warrants ahead of or alongside existing shareholders, and brings in a drilling business.
15 Aug 2008late filing notice▼ Bad
Velocity Energy Inc. notified the SEC that its quarterly report would be filed late.
23 July 2008material agreement termination● NeutralMajor
Effective June 23, 2008, Sonterra appointed South Texas Oil Company as contract operator of its Matagorda Bay properties in Texas state waters, and ended an April 2008 agreement under which Sonterra had operated South Texas's properties in central Texas, south Texas and Colorado. Pawelek, Psencik and Spurlock resigned as officers of Sonterra and became officers of South Texas; Donald Vandenberg (CEO/President), Gary Lancaster (VP and Chief Legal Officer) and Donald Sebastian (VP and CFO) replaced them. The filing says a well (ST 127 Unit Well No. 1) is being drilled below 5,000 feet under the new agreement, which follows up the Q2 2008 drilling plan.
25 June 2008director interest notice● Neutral
Velocity Energy Inc. VP--Operations Wayne A Psencik disposed of 1,713,455 shares via option/appreciation-right settlement.
29 May 2008material agreement● NeutralMajor
On May 22, 2008 the company issued Longview a $1,000,000 senior secured note due August 31, 2010, at three-month LIBOR plus 8.25% and secured by a first-priority lien on substantially all assets. With the $2,000,000 initial note, $3,000,000 of the $10,000,000 facility has been issued, which continues the Longview funding and adds debt ranking ahead of shareholders.
23 May 2008material agreement● Neutral
On May 19, 2008 the company and Longview again extended the deadline to file the resale registration statement for the warrant shares, this time to July 30, 2008 (previously April 30). Longview is stated to hold about 95% of the stock.
20 May 2008material agreement▼ BadMajor
On May 15, 2008 Longview waived a default on the $2,000,000 senior secured note. One of two operating wells was shut in and other factors meant December 31, 2007 results missed the note's reserve and coverage tests, and the company did not make the required partial repayment. Longview also loosened certain covenant measures through December 31, 2008, saying the company would otherwise have failed the same tests at March 31, 2008. This shows the company relies on its main lender's waivers.
16 May 2008auditor change● Neutral
This amendment to the May 12 auditor-change report adds only that there were no disagreements with the former auditor from January 1 to May 9, 2008. The rest repeats the earlier filing.
13 May 2008auditor change● Neutral
This amendment to the February 14 report adds audited financial statements of Old Sonterra (Sonterra Oil & Gas) for April 17 to December 31, 2007. They show revenues of $948,912, a net loss of $1,211,166, total assets of $11,391,444 and long-term debt of $7,990,010. They also include results of the acquired Cinco/Flash properties for January 1 to August 3, 2007 and for 2006, which had net income of $282,623 and $190,927 respectively. The auditor gave a clean opinion.
12 May 2008auditor change● Neutral
On May 9, 2008 the company replaced its auditor De Meo, Young, McGrath with Akin, Doherty, Klein & Feuge, P.C., which had audited Old Sonterra, because the Old Sonterra business is now its primary business. The company states there were no disagreements, and the former auditor's reports contained no adverse opinion but did include a going-concern qualification.
31 Mar 2008late filing notice▼ Bad
Velocity Energy Inc. notified the SEC that its annual report would be filed late.
18 Mar 2008material agreement● Neutral
On March 12, 2008 the company and Longview agreed to push back to April 30, 2008 the deadline for filing a registration statement covering resale of the shares underlying Longview's warrant. Longview is stated to hold about 96.8% of the stock; this is a timing change only.
20 Feb 2008substantial holder notice● Neutral
The Longview Fund, L.P, Longview Fund International, Ltd, Viking Asset Management, Ltd, Viking Asset Management, LLC, Peter Benz reported a Velocity Energy Inc. shareholding of 29,372,864 shares (95.80% of votes) in a periodic institutional filing.
19 Feb 2008director interest notice● Neutral
Velocity Energy Inc. President Michael J Pawelek received a stock option grant for 1,713,455 shares.
14 Feb 2008business combination● NeutralMajor
On February 14, 2008 the Sonterra exchange with Longview closed: the 38,552,749 existing shares were combined 1-for-10 into 3,855,275, the company was renamed Sonterra Resources, Inc., and Longview received 21,846,558 shares and a warrant over 4,958,678 shares (post-split) plus a $2,000,000 senior secured note in exchange for its Old Sonterra holdings and note. The company now operates the Texas Gulf Coast (Matagorda Bay) oil and gas properties through Old Sonterra, and former Old Sonterra holders own 95.8% of the stock, so earlier holders are heavily diluted. This resolves the August 2007 agreement; the filing describes the reinsurance effort as abandoned, and the extract shown does not address the insurance subsidiaries' divestiture.
9 Aug 2007capital raising announcement▼ BadMajor
On August 3, 2007 the company agreed with Longview (holder of about 66.6% of its stock) to acquire Sonterra Resources, Inc., an oil and gas business that had just bought assets from Cinco Natural Resources and has a pending purchase from Flash Gas & Oil Southwest. Longview would receive 218,465,578 shares (intended as 85% of the stock, before a 1-for-5 to 1-for-20 reverse split) plus a warrant, lifting its stake to about 90%. The company would also have a right to borrow up to $10,000,000 from Longview in secured notes at 3-month Libor plus 8.25% due August 31, 2010. It must divest the insurance subsidiaries as soon as practicable, with Sonterra's executives to become its CEO, VP-Operations and CFO. This moves the company from reinsurance into oil and gas and heavily dilutes other shareholders.
9 Aug 2007substantial holder notice● Neutral
The Longview Fund, L.P., Longview Fund International, Ltd., Viking Asset Management, Ltd., Viking Asset Management, LLC, Peter Benz reported a Velocity Energy Inc. shareholding of 25,676,274 shares (66.60% of votes) in a periodic institutional filing.