SEVENTY SEVEN ENERGY INC. (OTCMKTS:SSEIQ) Files An 8-K Regulation FD Disclosure
Item7.01.
| Regulation FD Disclosure. |
On April10, 2017, Seventy Seven Energy Inc. (SSE) and
Patterson-UTI Energy, Inc. (Patterson-UTI) jointly issued a press
release announcing the extension of the deadline for holders of
SSE warrants to exercise their warrants. A copy of the press
release is filed as Exhibit 99.1 hereto and is incorporated by
reference herein.
| Item8.01. | Other Events. |
Litigation Related to the Proposed Merger between SSE and
Patterson-UTI
As previously
disclosed, on December12, 2016, SSE entered into an Agreement and
Plan of Merger (the Merger Agreement) with Patterson-UTI and
Pyramid Merger Sub, Inc. (the Merger). SSE is filing this Current
Report on Form 8-K to provide certain updates in respect of the
proposed Merger. The following information should be read in
conjunction with the joint proxy statement/prospectus (the Joint
Proxy Statement/Prospectus) relating to the proposed Merger,
filed with the SEC on March22, 2017.
As disclosed on
page 125 of the Joint Proxy Statement/Prospectus, on February22,
2017, Maria Comeaux, a purported stockholder of SSE filed a
putative class action challenging the disclosures made in
connection with the Merger against SSE and the members of SSEs
board of directors. This lawsuit is >
The related
complaint (the Comeaux Complaint) alleges inadequacies in the
Merger price and the process leading up to it, and claims that
the Joint Proxy Statement/Prospectus filed in connection with the
merger fails to disclose certain allegedly material information
in violation of Sections 14(a) and 20(a) of the U.S. Securities
Exchange Act of 1934, as amended (the Exchange Act), and certain
rules promulgated thereunder. The alleged omissions generally
relate to (i)certain financial projections; (ii)certain valuation
analyses performed by SSEs financial advisor, Morgan Stanley; and
(iii)alleged conflicts of interest faced by Morgan Stanley and a
director of SSE. Based on these allegations, Comeaux sought to
enjoin the forthcoming stockholder vote on the Merger unless and
until SSE discloses the allegedly omitted material information
summarized above. Comeaux also seeks damages and attorneys fees.
On April10, 2017, plaintiff Comeaux withdrew her motion for a
preliminary injunction.
On March31, 2017,
Garud Sudarsan, a purported holder of Series B and Series C
Warrants of SSE, filed a putative class action against SSE,
Patterson-UTI and Merger Sub. This lawsuit is >
On April7, 2017,
Mainard Gael, a purported stockholder of SSE, filed a putative
class action challenging the disclosures made in connection with
the merger against SSE and the members of SSEs board of
directors. This lawsuit is >
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connection with
the proposed Merger; (iv)the identities of holders of Series A
Warrants of SSE, which information the Gael Complaint alleges is
necessary in order to determine whether the Significant SSE
Stockholders held significant Series A Warrants of SSE,
notwithstanding the fact that, had the Significant SSE
Stockholders held Series A Warrants, such ownership would have
been required to be disclosed in the Joint Proxy
Statement/Prospectus; and (v)alleged conflicts of interest faced
by Morgan Stanley. Based on these allegations, Gael seeks to
enjoin the consummation of the Merger, and if the proposed Merger
is consummated, Gael seeks damages.
On April10, 2017,
Louis Scarantino, a purported stockholder of SSE, filed a
putative class action challenging the disclosures made in
connection with the merger against SSE, the members of SSEs board
of directors, Patterson-UTI and Merger Sub. This lawsuit is
>
SSE and
Patterson-UTI believe that each of these lawsuits is without
merit, that the alleged omissions in the Comeaux, Sudarsan and
Scarantino Complaints are not material and intend to vigorously
defend against each of them. Neither SSE nor Patterson-UTI can
predict the outcome of these lawsuits or any others that might be
filed, nor can they predict the amount of time and expense that
will be required to defend the lawsuits. None of the foregoing
lawsuits are expected to affect the consummation of the Merger,
which is currently expected to occur on April20, 2017.
The descriptions
above are qualified in their entireties by reference to the
Comeaux Complaint, Sudarsan Complaint, Gael Complaint and
Scarantino Complaint, which are attached to this Current Report
on Form 8-K as Exhibits 99.2, 99.3, 99.4 and 99.5, respectively,
and are incorporated into this Item 8.01 by reference.
Important
Information for Investors and Stockholders
This Current
Report on Form 8-K (Form 8-K) does not constitute an offer to
sell or the solicitation of an offer to buy any securities or a
solicitation of any vote or approval. The acquisition by
Patterson-UTI of SSE in an all-stock transaction (the proposed
transaction) will be submitted to the stockholders of each of
Patterson-UTI and SSE for their consideration. Patterson-UTI and SSE have
mailed a joint proxy statement/prospectus to their respective
stockholders. SSE and Patterson-UTI may also file other documents
with the Securities and Exchange Commission (the SEC) regarding
the proposed transaction.
INVESTORS AND SECURITY HOLDERS
ARE URGED TO READ THE PROXY STATEMENT/PROSPECTUS AND ANY OTHER
RELEVANT DOCUMENTS THAT WILL BE FILED WITH THE SEC CAREFULLY AND
IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL
CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED
TRANSACTION.
Investors and security holders
may obtain free copies of the proxy statement/prospectus and
other documents containing important information about SSE and
Patterson-UTI through the website maintained by the SEC at
www.sec.gov. Copies of the documents filed with the SEC by
Patterson-UTI are free of charge on Patterson-UTIs website at
www.patenergy.com under the tab Investors and then through the
link titled SEC Filings or by contacting Patterson-UTIs Investor
Relations Department by email at investrelations@patenergy.com,
or by phone at (281) 765-7100. Copies of the documents filed with
the SEC by SSE are free of charge on SSEs website at
www.77nrg.com under the tab Investors and then through the link
titled SEC Filings or by contacting SSEs Investor Relations
Department at IR@77nrg.com, or by phone at (405)
608-7730.
Participants in
the Solicitation
Patterson-UTI, SSE and certain
of their respective directors and executive officers may be
deemed to be participants in the solicitation of proxies from the
stockholders of Patterson-UTI in connection with the proposed
transaction. Information about the directors and executive
officers of Patterson-UTI is set forth in
the 2016 Annual Report on Form 10-K/A for Patterson-UTI, which
was filed with the SEC on March13, 2017. Information about
the
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directors and executive
officers of SSE is set forth in the 2015 Annual Report on Form
10-K/A for SSE, which was filed with the SEC on April29, 2016 and
the Current Report on Form 8-K for SSE, which was filed with the
SEC on August1, 2016. These documents can be obtained free of
charge from the sources indicated above. Other information
regarding the participants in the proxy solicitation and a
description of their direct and indirect interests, by security
holdings or otherwise, will be contained in the proxy
statement/prospectus and other relevant materials to be filed
with the SEC when they become
available.
Cautionary
Statement Regarding Forward-Looking
Statements
This Form 8-K contains
forward-looking statements which are protected as forward-looking
statements under the Private Securities Litigation Reform Act of
1995 that are not limited to historical facts, but reflect
Patterson-UTIs current beliefs, expectations or intentions
regarding future events. Words such as anticipate, believe,
budgeted, continue, could, estimate, expect, intend, may, plan,
predict, potential, project, pursue, should, strategy, target, or
will, and similar expressions are intended to identify such
forward-looking statements. The statements in this Form 8-K that
are not historical statements, including statements regarding the
expected timetable for completing the proposed transaction,
benefits and synergies of the proposed transaction, costs and
other anticipated financial impacts of the proposed transaction;
the combined companys plans, objectives, future opportunities for
the combined company and services, future financial performance
and operating results and any other statements regarding
Patterson-UTIs and SSEs future expectations, beliefs, plans,
objectives, financial conditions, assumptions or future events or
performance that are not historical facts, are forward-looking
statements within the meaning of the federal securities laws.
These statements are subject to numerous risks and uncertainties,
many of which are beyond Patterson-UTIs or SSEs control, which
could cause actual results to differ materially from the results
expressed or implied by the statements. These risks and
uncertainties include, but are not limited to: failure to obtain
the required votes of Patterson-UTIs or SSEs
stockholders; the timing to consummate the proposed transaction;
satisfaction of the conditions to closing of the proposed
transaction may not be satisfied or that the closing of the
proposed transaction otherwise does not occur; the risk that a
regulatory approval that may be required for the proposed
transaction is not obtained or is obtained subject to conditions
that are not anticipated; the diversion of management time on
transaction-related issues; the ultimate timing, outcome and
results of integrating the operations of Patterson-UTI and SSE
following the consummation of the proposed transaction; the
effects of the business combination of Patterson-UTI and SSE
following the consummation of the proposed transaction, including
the combined companys future financial condition, results of
operations, strategy and plans; potential adverse reactions or
changes to business relationships resulting from the announcement
or completion of the proposed transaction; expected synergies and
other benefits from the proposed transaction and the ability of
Patterson-UTI to
realize such synergies and other benefits; expectations regarding
regulatory approval of the transaction; results of litigation,
settlements and investigations; actions by third parties,
including governmental agencies; volatility in customer spending
and in oil and natural gas prices, which could adversely affect
demand for Patterson-UTIs services and their associated effect on
rates, utilization, margins and planned capital expenditures;
global economic conditions; excess availability of land drilling
rigs and pressure pumping equipment, including as a result of low
commodity prices, reactivation or construction; liabilities from
operations; weather; decline in, and ability to realize, backlog;
equipment specialization and new technologies; shortages, delays
in delivery and interruptions of supply of equipment and
materials; ability to hire and retain personnel; loss of, or
reduction in business with, key customers; difficulty with growth
and in integrating acquisitions; governmental regulation; product
liability; legal proceedings; political, economic and social
instability risk; ability to effectively identify and enter new
markets; cybersecurity risk; dependence on our subsidiaries to
meet our long-term debt obligations; variable rate indebtedness
risk; and anti-takeover measures in our charter
documents.
Additional information
concerning factors that could cause actual results to differ
materially from those in the forward-looking statements is
contained from time to time in Patterson-UTIs and SSEs SEC
filings. Patterson-UTIs filings may be obtained by contacting
Patterson-UTI or the SEC or through Patterson-UTIs web site at
http://www.patenergy.com or through the SECs Gathering and
Analysis Retrieval System (EDGAR) at http://www.sec.gov. SSEs
filings may be obtained by contacting SSE or the SEC or through
SSEs web site at www.77nrg.com or through EDGAR. Patterson-UTI
and SSE undertake no obligation to publicly update or revise any
forward-looking
statement.
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| Item9.01. | Financial Statements and Exhibits. |
| (d) | Exhibits |
| 99.1 | Joint press release dated April10, 2017. | |
| 99.2 |
Complaint filed in the United States District Court for the Western District of Oklahoma, captioned Maria Comeaux et al. v. Seventy Seven Energy Inc., et al, filed February22, 2017. |
|
| 99.3 |
Complaint filed in the United States District Court for the Southern District of New York, captioned Garud Sudarsan et al v. Seventy Seven Energy Inc., et al, filed March31, 2017. |
|
| 99.4 |
Complaint filed in the Court of Chancery of the State of Delaware, captioned Mainard Gael et al v. Seventy Seven Energy, Inc. et al, filed April7, 2017. |
|
| 99.5 |
Complaint filed in the Court of Chancery of the State of Delaware, captioned Louis Scarantino et al v. Seventy Seven Energy Inc. et al, filed April10, 2017. |
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About SEVENTY SEVEN ENERGY INC. (OTCMKTS:SSEIQ)
Seventy Seven Energy Inc. is a diversified oilfield services company. The Company provides a range of well site services and equipment to the United States land-based exploration and production (E&P) customers operating in unconventional resource plays. The Company’s segments include Drilling, Hydraulic Fracturing and Oilfield Rentals. The drilling segment is operated through its subsidiary, Nomac Drilling, L.L.C., and provides land drilling services for oil and natural gas E&P activities. The hydraulic fracturing segment is operated through its subsidiary, Performance Technologies, L.L.C. (PTL), and provides high-pressure hydraulic fracturing or frac services and other well stimulation services. The Company’s oilfield rentals segment is operated through its subsidiary, Great Plains Oilfield Rental, L.L.C. (GPOR), and provides premium rental tools and specialized services for land-based oil and natural gas drilling, completion and workover activities. SEVENTY SEVEN ENERGY INC. (OTCMKTS:SSEIQ) Recent Trading Information
SEVENTY SEVEN ENERGY INC. (OTCMKTS:SSEIQ) closed its last trading session at 0.0000 with 1,138,200 shares trading hands.