Each one in plain English, with the numbers worked through for a shareholder.
11 Dec 2012production update● NeutralMajor
ZaZa said on December 11, 2012 that France's ministers had issued a letter of non-objection on December 10 to the sale of the French subsidiary to Vermilion, which it still expected to close by year-end. It also said the Stingray well in the Eaglebine hit a restriction during completion that will limit production in the near term, and that it plans to start sales by December 16 to meet its Range obligation and then shut the well in to fix it. ZaZa plans to sell two Eagle Ford prospects (Dilley, about 2,000 net acres, and Hackberry/Oakland, about 23,000) in the first quarter of 2013, leaving about 47,000 net acres. Management said senior executives intend to buy shares in the open market.
Todd Alan Brooks, John E. Hearn, Jr, Gaston L. Kearby reported a ZaZa Energy Corp shareholding of 67,641,851 shares (66.80% of votes) in a periodic institutional filing.
On November 13, 2012 ZaZa agreed to sell all the shares of ZaZa Energy France SAS to Vermillion REP SAS (a Vermillion Energy subsidiary) for $85.8 million cash, before adjustments, with closing expected before the end of 2012. ZaZa plans to use part of the proceeds to pay down its senior secured notes and speed up Texas drilling, and $15.0 million will sit in escrow until the Paris Basin permits are transferred to Hess. This is the French side of the Hess deal that was still pending; closing needs government approvals, Hess France's consent and senior noteholder approval of an intercompany loan transfer. The attached earnings release also reports third-quarter total revenues and other income of $207.2 million, including $197.0 million of other income, and net income to common shareholders of $133.8 million. It also says the 10-K and the first two 10-Qs were filed and NASDAQ confirmed full compliance, which resolves the earlier listing thread.
22 Oct 2012capital raising announcement● NeutralMajor
On October 22, 2012 ZaZa sold $40 million of 9% convertible senior notes due August 1, 2017 in a private placement at $950 per $1,000, for gross proceeds of $38.0 million and about $35.2 million net. The money is meant for drilling spending, leasehold deals and general corporate purposes. The notes are unsecured and can be converted into shares at $2.50 each (400 shares per $1,000 note), so they could dilute existing shareholders if converted. The same day's filing also records a third amendment to the secured noteholders' agreement that allows this new debt and changes the terms of their warrants.
On August 15, 2012 NASDAQ sent a third non-compliance letter, for the late quarterly report (10-Q) for June 30, 2012, requiring an update to ZaZa's compliance plan by August 30, 2012. Trading is not suspended; ZaZa says it expects to file soon, helped in part by completing the Hess transaction. The earlier 10-K and March 10-Q filings are still not shown as filed in this record.
30 July 2012asset acquisition disposition● NeutralMajor
On July 25, 2012 ZaZa closed the Texas side of the Hess deal agreed in June: it received about $69 million cash and about 60,500 more net Eagle Ford acres (core now about 72,000 net acres), and Hess got about 4,490 net acres in the Cotulla area plus small royalties. The French part awaits government approval. ZaZa then paid down $33.0 million of the senior notes plus a $3.5 million fee, under amended terms including a rate step-up to 10% if the notes are not at $35 million by Feb 21, 2013. The filing says the Hess partnership ended after the sides had different understandings of Hess's obligations, and that French fracking legislation had cut the value of the French agreements. CEO Craig McKenzie resigned effective August 1 with a $550,000 lump sum and other benefits, and Todd Alan Brooks became CEO.
On June 8, 2012 ZaZa signed a non-binding Heads of Agreement with Hess to end their 2010 Eagle Ford and Paris Basin deals. If completed, ZaZa would get $70 million cash, about 60,500 more net Eagle Ford acres (taking its core to about 72,000 net acres), a share of any Hess sale proceeds above $1 billion, and would hand over its 50% Paris Basin exploration licence interest while keeping a 5% revenue interest capped at $130 million. Hess also paid $15 million on June 8 to drop its well-carry obligation in the Cotulla area. Alongside, noteholders waived existing defaults (including late audited financials) and will consent if ZaZa pays down $33 million of the senior notes plus a $3.5 million fee; the rate rises to 10% if the notes are not at $35 million by Feb 21, 2013. ZaZa also hired Jefferies to seek joint venture partners.
On May 21, 2012 NASDAQ sent a second non-compliance letter, this time for the late quarterly report (10-Q) for March 31, 2012, with a compliance plan due by June 18, 2012. This adds to the April notice over the unfiled 2011 10-K; the company says trading is unaffected and it expects to file soon.
