LILIS ENERGY, INC. (OTCMKTS:LLEX) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01
| Entry into a Material Definitive Agreement. |
Private Placement
On February 28, 2017, Lilis Energy, Inc. (the Company) entered
into a Securities Subscription Agreement (the Subscription
Agreement) with certain institutional and accredited investors in
connection with a private placement (the Offering) of units of
the Company, consisting of one share of common stock and a
warrant to purchase 0.50 shares of common stock (each, a Unit),
at a price per unit of $3.85, with approximately $20 million in
signed commitments. Each warrant has an exercise price of $4.50
and may be subject to redemption by the Company, upon prior
written notice, if the price of the Companys common stock closes
at or above $6.30 for twenty trading days during a consecutive
thirty trading day period. The closing of the Offering is subject
to the satisfaction of customary closing conditions.
Lilis expects to use the net proceeds from the Offering to
support its 2017 Delaware Basin development program, Delaware
Basin lease acquisition program, and for general corporate
purposes including working capital.
The securities to be sold in the Offering have not been
registered under the Securities Act of 1933, as amended (the
Securities Act) or any state securities laws and may not be
offered or sold in the United States absent registration or an
applicable exemption from registration. However, in conjunction
with the closing of the Offering, the Company has also entered
into a registration rights agreement (the Registration Rights
Agreement) whereby the Company agreed to use its reasonable best
efforts to register, on behalf of the investors, the shares of
common stock underlying the Units and the shares of common stock
underlying the warrants no later than April 1, 2017.
Johnson Rice Company and T.R. Winston Company, LLC served as
placement agents in connection with the Offering, and KES 7
Capital Inc. acted as advisor to the Company.
The foregoing description of the terms of the Subscription
Agreement, the Warrants and the Registration Rights Agreement is
not complete and is qualified in its entirety by reference to the
terms of the Subscription Agreement, the Warrants and the
Registration Rights Agreement, the forms of which are attached as
Exhibits 10.1, 4.1 and 10.2 hereto, respectively.
| Item 3.02 | Unregistered Sales of Equity Securities. |
On February 28, 2017, the Company entered into the Subscription
Agreement to sell approximately 5.2 million Units, consisting of
approximately 5.2 million shares of common stock and warrants to
purchase an additional approximately 2.6 million shares of common
stock (as described in Item 1.01 above), to certain institutional
and accredited investors for an aggregate purchase price of $20
million. These securities were issued to Section 4(a)(2) of the
Securities Act and Rule 506 promulgated thereunder. The investors
represented their intentions to acquire the securities for
investment only and not with a view toward distribution. The
holders were given adequate information about the Company to make
an informed investment decision. The Company did not engage in
any general solicitation or advertising. The Company issued the
stock certificates and warrants with the appropriate restrictive
legend affixed thereto.
| Item 7.01 | Regulation FD Disclosure. |
On March 1, 2017, the Company issued a press release announcing
the Offering, a copy of which is furnished as Exhibit 99.1
hereto. The press release shall not constitute an offer to sell
or the solicitation of an offer to buy any of the securities
described therein, nor shall there be any sale of these
securities in any state or jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such state or
jurisdiction.
The above information (including Exhibit 99.1) is furnished to
Item 7.01 of Form 8-K and shall not be deemed to be filed for
purposes of Section 18 of the U.S. Securities Exchange Act of
1934, as amended, or otherwise subject to the liabilities of that
Section, nor shall it be deemed to be incorporated by reference
in any filing under the Securities Act, except as may be
expressly set forth by specific reference in such filing.
| Item 9.01 | Financial Statements and Exhibits. |
| (d) | Exhibits. |
| Exhibit No. | Description | |
| 4.1 | Form of Warrant | |
| 10.1 | Form of Securities Subscription Agreement | |
| 10.2 | Form of Registration Rights Agreement | |
| 99.1 | Press Release of Lilis Energy, Inc. dated March 1, 2017 |
About LILIS ENERGY, INC. (OTCMKTS:LLEX)
Lilis Energy, Inc. is an upstream independent oil and gas company. The Company is engaged in the acquisition, drilling and production of oil and natural gas properties and prospects. The Company drills for, operates and produces oil and natural gas wells through its land holdings located in Wyoming, Colorado, and Nebraska. Its total net acreage in the Denver-Julesburg (DJ) Basin is approximately 7,200 acres. The Company’s primary targets within the DJ Basin are the conventional Dakota and Muddy J formations. In addition to its DJ Basin holdings, it focuses on the Permian’s Delaware Basin in Winkler and Loving Counties, Texas and Lea County, New Mexico. The Company’s net acreage in the Delaware Basin is approximately 4,433 net acres. The vertical well produces approximately 690 net million cubic feet (mcf) per day. The well holds the lease to all depths, from surface down to approximately 22,000 feet, including the Wolfcamp, Bone Springs, and Avalon formations. LILIS ENERGY, INC. (OTCMKTS:LLEX) Recent Trading Information
LILIS ENERGY, INC. (OTCMKTS:LLEX) closed its last trading session up +0.30 at 4.00 with 198,983 shares trading hands.