Callon Petroleum Company (NYSE:CPE) Files An 8-K Entry into a Material Definitive Agreement
Item1.01. Entry into a Material Definitive Agreement.
Ameredev Purchase Agreement
On December13, 2016, Callon Petroleum Operating Company (CPOC), a
wholly owned subsidiary of Callon Petroleum Company (Callon or
the Company), entered into a purchase and sale agreement (the
Ameredev Purchase Agreement) with American Resource Development
LLC, American Resource Development Upstream LLC and American
Resource Development Midstream LLC (collectively, the Seller) for
the purchase of certain oil and gas producing properties and
undeveloped acreage in the Delaware Basin (the Ameredev
Acquisition) for total consideration of $615million in cash (the
Consideration), subject to customary purchase price adjustments
in accordance with the Ameredev Purchase Agreement. In connection
with the execution of the Ameredev Purchase Agreement, CPOC has
agreed to pay a deposit in the amount of $46million(theDeposit)to
a third party escrow agent within one business day of the date of
the Ameredev Purchase Agreement.
Upon closing of the Ameredev Acquisition, the Company will assume
operatorship of over 80% of the acquired acreage and own an
estimated 82% average working interest.
Consummation of the Ameredev Acquisition is subject to the
completion of various customary conditions, including, among
others (1)the accuracy of the representations and warranties of
the parties as of the closing date (except, with respect to
Seller, to the extent not resulting in a material adverse
effect), (2) the performance of various covenants and agreements
of the parties through the closing date, (3)the execution of
certain ancillary documents, (4)limitation on the net sum of all
purchase price adjustments made to the Ameredev Purchase
Agreement, and (5)other customary closing conditions. The
Ameredev Acquisition is expected to close on or before
February13, 2017.
The Ameredev Purchase Agreement contains certain termination
rights for CPOC and the Seller, including (i)if the closing has
not occurred on or prior to February28, 2017 through no fault of
the terminating party.
If the Seller terminates the Ameredev Purchase Agreement because
CPOC has failed to satisfy conditions to closing through no fault
of the Seller and the conditions to closing of CPOC have been
satisfied or waived, Seller is entitled to either retain the
Deposit as liquidated damages as its sole remedy or enforce
specific performance. If CPOC terminates the Ameredev Purchase
Agreement because the Seller has failed to satisfy conditions to
closing through no fault of CPOC and the conditions to closing of
Seller have been satisfied or waived, CPOC is entitled to either
(1)the return of the Deposit and all other remedies available at
law or (2)the enforcement of specific performance.
The foregoing description of the Ameredev Purchase Agreement is
qualified in its entirety by reference to the text of the
Ameredev Purchase Agreement, which is filed herewith as Exhibit
2.1 to this Report and is incorporated in this Report by
reference.
Section7 Regulation FD
Item7.01. Regulation FD Disclosure.
Press Release
On December13, 2016, the Company issued a press release, attached
as Exhibit 99.1, announcing the acquisition described above. A
copy of the press release is furnished as Exhibit 99.1 hereto and
is incorporated herein by reference.
Website Presentation
The Company has posted on its website, as of December13, 2016, a
presentation that includes additional information on the pending
transaction. The presentation, entitled Acquisition Overview may
be found by navigating our website at: www.callon.com, selecting
Investors then Events Presentations.
The information set forth in this Item 7.01 and in the attached
Exhibit 99.1 shall not be deemed filed for purposes of Section18
of the Securities Exchange Act of 1934, as amended (the Exchange
Act), or incorporated by reference in any filing under the
Securities Act of 1933, as amended, or the Exchange Act, except
as shall be expressly set forth by specific reference in such
filing.
Section9 Financial Statements and Exhibits
Item9.01. Financial Statements and Exhibits.
(d) Exhibits
|
Exhibit Number |
Title of Document |
|
| 2.1 |
Purchase and Sale Agreement between American Resource Development LLC, American Resource Development Upstream LLC and American Resource Development Midstream LLC, collectively, as Seller and CPOC, as Purchaser, dated December13, 2016# |
|
| 99.1 |
Press release dated December13, 2016 announcing the Ameredev Acquisition |
| # |
Exhibits and Schedules have been omitted to Item601(b)(2) of Regulation S-K. The Company agrees to furnish a supplemental copy of any such omitted Exhibit or Schedule to the Securities and Exchange Commission upon request. |
to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
| Callon Petroleum Company | ||||||
| (Registrant) | ||||||
|
December13, 2016 |
By: | /s/ Joseph C. Gatto, Jr. | ||||
| Joseph C. Gatto, Jr. | ||||||
| President, Chief Financial Officer, and Treasurer |
Exhibit Index
|
Exhibit Number |
Title of Document |
|
| 2.1 |
Purchase and Sale Agreement between American Resource Development LLC, American Resource Development Upstream LLC and American Resource Development Midstream LLC, collectively, as Seller and CPOC, as Purchaser, dated December13, 2016# |
|
| 99.1 |
Press release dated December13, 2016 announcing the Ameredev Acquisition |
| # | Exhibits and Schedules have been omitted |
About Callon Petroleum Company (NYSE:CPE)
Callon Petroleum Company is an independent oil and natural gas company. The Company is engaged in the exploration, development, acquisition and production of oil and natural gas properties. It focuses on unconventional, onshore, oil and natural gas reserves in the Permian Basin in West Texas and the Midland Basin. Its asset base is concentrated in the Midland Basin located within the broader Permian Basin. Its operations are focused on horizontal drilling of several prospective intervals, including multiple levels of the Wolfcamp formation. It has drilled approximately 40 gross (over 27.1 net) horizontal, while completing approximately 30 gross (over 25.8 net) horizontal and over 1 gross (approximately 0.4 net) vertical wells. It owns leaseholds over 17,670 net acres in the Permian Basin. Its Southern Midland Basin area consists of fields located in Upton, Reagan and Crockett Counties, Texas. Its Central Midland Basin area encompasses Midland, Ector, Andrews and Martin Counties. Callon Petroleum Company (NYSE:CPE) Recent Trading Information
Callon Petroleum Company (NYSE:CPE) closed its last trading session down -1.12 at 16.27 with 3,701,646 shares trading hands.