Matador Resources Company (NYSE:MTDR) Files An 8-K Entry into a Material Definitive Agreement
Item1.01.
| Entry into a Material Definitive Agreement. |
Contribution Agreement
On February17, 2017, in connection with the formation of San
Mateo Midstream, LLC (San Mateo Midstream), a joint venture with
FP MMP Holdings LLC, a subsidiary of Five Point Capital Partners
LLC (Five Point), Longwood Midstream Holdings, LLC (Longwood
Holdings), a wholly-owned subsidiary of Matador Resources Company
(Matador), entered into and consummated the transactions (the
Closing) contemplated by a Subscription and Contribution
Agreement (the Contribution Agreement), by and among Longwood
Holdings, Five Point and San Mateo Midstream.
to the terms of the Contribution Agreement, Longwood Holdings
made an initial capital contribution to San Mateo Midstream
consisting of (a)all of the outstanding equity interests in
Longwood RB Pipeline, LLC (Longwood RB), Longwood Wolf Pipeline,
LLC (Longwood Wolf), Fulcrum Delaware Water Resources, LLC
(Fulcrum), DLK Black River Midstream, LLC (DLK) and Black River
Water Management Company, LLC (Black River and, together with
Longwood RB, Longwood Wolf, Fulcrum and DLK, the Contributed
Entities), which Contributed Entities hold Matadors midstream
assets in the Wolf and Rustler Breaks areas valued at
$350.0million (the Midstream Assets) and (b)cash in the amount of
$5.1million, in exchange for 51.0% of the membership interests in
San Mateo Midstream. Also at the Closing, Five Point made an
initial capital contribution of cash in the amount of
$176.4million, of which $171.5million was immediately distributed
to Longwood Holdings, partially as a reimbursement of capital
expenditures by Matador and its subsidiaries with respect to the
Midstream Assets, in exchange for 49.0% of the membership
interests in San Mateo Midstream. In addition to the initial
capital contributions, each of Longwood Holdings and Five Point
committed to make additional capital contributions of
$71.4million and $68.6million, respectively. Within 120 days
following the Closing, the initial capital contributions will be
subject to customary adjustments based on the net working capital
of the Contributed Entities at the Closing and the net operating
income of the Contributed Entities between February1, 2017 and
the Closing.
The Contribution Agreement contains customary representations and
warranties and covenants by Longwood Holdings, Five Point and San
Mateo Midstream, including covenants regarding certain tax and
confidentiality matters.
The description of the Contribution Agreement set forth above is
qualified in its entirety by reference to the Contribution
Agreement, a copy of which is filed as Exhibit 2.1 to this
Current Report on Form 8-K (this Current Report) and is
incorporated herein by reference. This summary of the principal
terms and the Contribution Agreement have been included to
provide security holders with information regarding the terms of
the Contribution Agreement. Neither is intended to provide any
other factual information about Matador, Longwood Holdings, Five
Point or their respective subsidiaries or affiliates. The
representations and warranties and covenants contained in the
Contribution Agreement were made solely for purposes of the
Contribution Agreement as of specific dates, were solely for the
benefit of the parties to the Contribution Agreement, may be
subject to limitations agreed upon by the contracting parties,
including being qualified by confidential disclosures made for
the purposes
of allocating contractual risk between the parties to the
Contribution Agreement instead of establishing these matters as
facts, and may be subject to standards of materiality applicable
to the contracting parties that differ from those applicable to
security holders. Security holders are not third-party
beneficiaries under the Contribution Agreement and should not
rely on the representations, warranties and covenants or any
descriptions thereof as characterizations of the actual state of
facts or condition of Matador, Longwood Holdings or Five Point.
Moreover, information concerning the subject matter of the
representations and warranties may change after the date of the
Contribution Agreement, which subsequent information may or may
not be fully reflected in Matadors public disclosures.
Supplemental Indenture
On February17, 2017, in connection with the transactions
contemplated by the Contribution Agreement (the Contribution
Transactions), Matador entered into a Fourth Supplemental
Indenture (the Fourth Supplemental Indenture) with Wells Fargo
Bank, National Association, as trustee (the Trustee), which
supplements the Indenture, dated as of April14, 2015 (as
supplemented and amended, the Indenture), among Matador, the
Guarantors named therein and the Trustee. to the Fourth
Supplemental Indenture, on February17, 2017, (i)Longwood Holdings
was designated as a guarantor under the Indenture and (ii)DLK and
Black River were released as parties to and as guarantors under
the Indenture.
The foregoing description of the Fourth Supplemental Indenture
does not purport to be complete and is qualified in its entirety
by reference to the Fourth Supplemental Indenture, which is
attached hereto as Exhibit 4.1 and is incorporated herein by
reference.
| Item2.01. |
Completion of Acquisition or Disposition of Assets. |
On February17, 2017, Longwood Holdings consummated the
transactions contemplated by the Contribution Agreement (the
Contribution Transactions) described in Item 1.01 of this Current
Report, which is incorporated by reference into this item in its
entirety.
| Item7.01. | Regulation FD Disclosure. |
On February17, 2017, Matador issued a press release announcing
the execution of the Contribution Agreement and the Closing of
the Contribution Transactions. A copy of the press release is
furnished as Exhibit 99.1 to this Current Report.
The information furnished to this Item 7.01, including Exhibit
99.1, shall not be deemed to be filed for purposes of Section18
of the Securities Exchange Act of 1934, as amended, and will not
be incorporated by reference into any filing under the Securities
Act of 1933, as amended, unless specifically identified therein
as being incorporated therein by reference.
| Item9.01. | Financial Statements and Exhibits. |
| (b) | Pro forma financial information. |
The pro forma financial information for the Contribution
Transactions required by Item 9.01 is furnished as Exhibit 99.2
to this Current Report. The unaudited pro forma condensed
consolidated balance sheet as of September30, 2016 has been
prepared to present Matadors financial condition as if the
Contribution Transactions had occurred on September30, 2016. The
unaudited pro forma condensed consolidated statements of
operations for the nine months ended September30, 2016 and the
fiscal year ended December31, 2015 have been prepared to present
Matadors results of operations as if the Contribution
Transactions had occurred on January1, 2016 or January1, 2015,
respectively. The unaudited pro forma financial information has
been prepared for comparative purposes only and does not purport
to be indicative of future results of operations or financial
condition.
| (d) | Exhibits. |
|
Exhibit No. |
Description |
|
| 2.1* |
Subscription and Contribution Agreement, dated as of February17, 2017, by and among Longwood Midstream Holdings, LLC, FP MMP Holdings LLC and San Mateo Midstream, LLC. |
|
| 4.1 |
Fourth Supplemental Indenture, dated as of February17, 2017, by and among Matador Resources Company, Black River Water Management Company, LLC, DLK Black River Midstream, LLC, Longwood Midstream Holdings, LLC, the Guarantors named therein and Wells Fargo Bank, National Association, as trustee. |
|
| 99.1 | Press Release, dated February17, 2017. | |
| 99.2 |
Unaudited Pro Forma Condensed Consolidated Financial Information. |
| * |
to Item 601(b)(2) of Regulation S-K, Matador agrees to furnish supplementally a copy of any omitted exhibit or schedule to the SEC 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.
|
MATADOR RESOURCES COMPANY |
||||||
| Date: February24, 2017 | By: |
/s/ Craig N. Adams |
||||
| Craig N. Adams | ||||||
| Executive Vice President |
INDEX TO EXHIBITS
|
Exhibit No. |
Description |
|
| 2.1* |
Subscription and Contribution Agreement, dated as of February17, 2017, by and among Longwood Midstream Holdings, LLC, FP MMP Holdings LLC and San Mateo Midstream, LLC. |
|
| 4.1 |
Fourth Supplemental Indenture, dated as of February17, 2017, by and among Matador Resources Company, Black River Water Management Company, LLC, DLK Black River Midstream, LLC, Longwood Midstream Holdings, LLC, the Guarantors named therein and Wells Fargo Bank, National Association, as trustee. |
|
| 99.1 | Press Release, dated February17, 2017. | |
| 99.2 |
Unaudited Pro Forma Condensed Consolidated Financial Information. |
| * |
About Matador Resources Company (NYSE:MTDR)
Matador Resources Company is an independent energy company engaged in the exploration, development, production and acquisition of oil and natural gas resources in the United States, with an emphasis on oil and natural gas shale and other unconventional plays. The Company’s segment is oil and natural gas exploration and production. The Company’s operations are focused primarily on the oil and liquids-rich portion of the Wolfcamp and Bone Spring plays in the Delaware Basin in Southeast New Mexico and West Texas. The Company also operates in the Eagle Ford shale play in South Texas and the Haynesville shale and Cotton Valley plays in Northwest Louisiana and East Texas. The Company’s properties include approximately 39,000 gross (29,300 net) acres in the Eagle Ford shale play in Atascosa, DeWitt, Gonzales, Karnes, La Salle, Wilson and Zavala Counties in South Texas. The Company operates approximately two rigs in the Eagle Ford shale in South Texas. Matador Resources Company (NYSE:MTDR) Recent Trading Information
Matador Resources Company (NYSE:MTDR) closed its last trading session down -0.88 at 24.42 with 1,875,054 shares trading hands.