Gastar Exploration Inc.

Gastar Exploration Inc. terminated the registration of a class of securities, ending its reporting obligation for them.

listing compliance notice

On December 20, 2018 the bankruptcy court confirmed Gastar's amended prepackaged Chapter 11 plan; the plan takes effect once its conditions are met, and the filing says this is not yet certain. Existing common holders other than Ares share $150,000 in cash and their shares are cancelled, leaving Ares and its affiliates as sole stockholder; preferred holders share $150,000 and are cancelled. One preferred holder may elect by January 4, 2019 to take warrants for less than 1% of the new common equity instead. The term loan and convertible note claims convert into the new common equity and a second lien exit facility, and the hedge claims are paid in full in cash. The market check opened in November is not mentioned as producing a different outcome.

bankruptcy or receivership

On December 12, 2018 Gastar filed a modified plan that replaces the earlier warrant recovery for existing shareholders with cash: preferred holders share $150,000 and common holders (excluding Ares) share $150,000, and those shares are cancelled. This is worse for shareholders than the earlier plan terms, which offered warrants for 2.5% of the new equity to common holders and 2.5% to preferred holders. Gastar warns that trading prices may bear little relation to actual recovery.

bankruptcy or receivership

On November 16, 2018 Gastar and the Ares-affiliated parties amended the October 26 restructuring support agreement so the company can run a market check and look for buyers of the whole company or substantially all its assets. Gastar sent bidders a process letter asking for all-cash proposals, with a bid deadline of December 17, 2018, and the court set the plan confirmation hearing for December 20, 2018 (objections due December 17). This opens a possible alternative to the Ares-led plan; the filing says the company will seek confirmation of the plan unless it receives a bid it deems higher or better.

material agreement

On October 31, 2018, Gastar and a subsidiary filed a prepackaged Chapter 11 case in the Southern District of Texas under a Restructuring Support Agreement signed October 26 with Ares affiliates. This resolves the strategic-alternatives search and the delisting and default risk of the preceding months. All voting classes accepted the plan, including 100% of term lenders and second-lien noteholders. Under the plan the term loan and convertible notes are swapped for a $200M second lien exit facility and 100% of the new common equity, and the company receives $100M of new money. Existing common holders get only warrants for 2.5% of the new equity, and Series A and B preferred holders share warrants for another 2.5%, both conditional on not opposing the plan. Existing common equity is cancelled, and Gastar itself warns equity holders could see a significant or complete loss.

bankruptcy or receivership

Gastar Exploration Inc.'s exchange filed to remove a class of its securities from listing.

listing compliance notice

Gastar Exploration Inc.'s exchange filed to remove a class of its securities from listing.

listing compliance notice

Gastar Exploration Inc.'s exchange filed to remove a class of its securities from listing.

listing compliance notice

On September 6, 2018, NYSE American suspended trading in Gastar's common stock and both preferred series because of the abnormally low price, as the August warning had flagged. The securities are expected to be quoted on the OTCQB from about September 7, and the exchange intends to start delisting. The company is reviewing whether to appeal while its search for third-party proposals continues. A delisting would let convertible noteholders demand repurchase at 101%, which could set off defaults and acceleration of the Ares term loan.

listing compliance notice

On August 28, 2018, NYSE American told Gastar its common stock had sold at a low price for a substantial period. Continued listing depends on a reverse stock split or sustained price improvement by February 28, 2019, and the stock is below compliance, with a '.BC' designation. The company says it is weighing strategic transactions, including financing, refinancing, sale or merger. Trading would be suspended if the price fell to $0.06 or below, and a delisting would let convertible noteholders demand repurchase at 101%, which could trigger default and let the Ares term loan lenders accelerate that loan.

listing compliance notice

On June 29, 2018, Gastar signed Amendment No. 4 and a Limited Waiver to the Ares-held term loan, and a Second Supplemental Indenture for the 2022 convertible notes, both with Wilmington Trust. Both waive certain 'inadvertent defaults' (the filing does not say what they were) and bar cash dividends on capital stock, except the June 2018 dividends on the Series A and Series B preferred. This ends the earlier expectation that covenants would not restrict preferred dividends, so preferred holders should not count on payments after June 2018 (inference).

material agreement

Gastar completed the West Edmond Hunton Lime Unit sale to Revolution Resources on February 28, 2018, receiving about $98.8 million net cash after about $8.7 million of adjustments (against the $107.5 million price), subject to further closing adjustments. This resolves the January sale agreement; the company says it will redirect the funds to drilling operated Osage and Meramec wells in its STACK position. The filing includes pro forma statements but does not say how the proceeds will be applied to the Ares term loan.

asset acquisition disposition

On January 23, 2018 Gastar agreed to sell its West Edmond Hunton Lime Unit and adjacent undeveloped acreage to Revolution Resources, LLC for $107.5 million cash, with a 10% deposit received Jan 25 and closing expected around Feb 28, 2018. The unit produced about 2,836 Boe/d net in Q3 2017, 46% of the company's total that quarter, so this is a large part of production; management says the proceeds should fund its STACK drilling plan (about 20 operated wells) through 2018. Closing is subject to conditions, including caps of 20% of the price on defects.

material agreement

Gastar Exploration Inc. terminated the registration of a class of securities, ending its reporting obligation for them.

listing compliance notice

Gastar Exploration Inc.'s exchange filed to remove a class of its securities from listing.

listing compliance notice

On March 22, 2017 Gastar bought extra interests in about 66 gross (9.5 net) producing wells and 5,670 net acres of STACK leasehold in Kingfisher County, Oklahoma for about $51.4 million cash from several sellers. It was funded by selling Ares another $75 million of the 6.0% Convertible Notes on March 21. If stockholders approve by July 3, 2017, $37.5 million of these notes becomes convertible and the other $37.5 million must be exchanged for 25,456,521 new shares plus 2,000 special voting preferred shares, which would dilute existing holders further; without approval the notes are not convertible and the interest rate steps up to 15%. This adds to the Ares financing thread and the open stockholder vote.

capital raising announcement

Gastar closed the Ares refinancing on March 3, 2017: it sold Ares-affiliated funds $125 million of 6.0% Convertible Notes due 2022 and 29,408,305 new shares for $50 million (about 18.8% of the 156.7 million shares outstanding at Jan 31, 2017), and took a $250 million 8.5% first-lien term loan due March 3, 2022. The money fully repaid the $69.2 million revolver and discharged the $325 million 8.625% notes due 2018, which will be redeemed at 102.156% on March 24, 2017. This completes the pending financing; note conversion still needs stockholder approval by July 3, 2017, and the filing says the preferred dividends are not expected to be restricted through July 2018 but are not assured.

capital raising announcement

Gastar agreed to a financing with Ares Management affiliates: $125 million of 6.0% Convertible Notes due 2022, 29,408,305 new common shares for $50 million (about 18.8% of the 156.7 million shares outstanding at Jan 31, 2017), and a separate $250 million 8.5% first-lien term loan. Proceeds are to repay the $70.4 million revolver and the $325 million 2018 senior secured notes. Existing shareholders are diluted, and the notes' conversion (at $2.2103 per share) depends on stockholder approval within four months of closing. Ares gets board nomination rights (two seats while it holds at least 15%). The filing also sets a 2017 capital budget of about $84.0 million and says year-end 2016 cash was about $71.5 million with $84.6 million drawn on the revolver. This settles the open thread on the 2018 notes' fate, but closing is still pending.

capital raising announcement

Under Amendment No. 10 to its credit agreement, Gastar may resume paying preferred dividends (permitted through May 2017 if conditions are met, with dividends funded only from equity sale proceeds since Nov 30, 2016), and it declared a special dividend of about $12.1 million to pay all unpaid Series A and B preferred dividends accrued since April 1, 2016, payable Jan 31, 2017. It also agreed to repay at least another $8.1 million of revolver debt by April 30, 2017. This resolves the dividend suspension that began in April 2016 for preferred holders; the filing gives no assurance that later monthly dividends will be paid.

material agreement

Gastar completed an initial closing of the sale to Red Bluff on Nov 18, 2016, receiving about $46.4 million in cash, with a further ~$28.3 million (including the $10 million contingent portion) held in escrow pending title and other conditions. The November redetermination cut the borrowing base from $100 million to $85 million, and Gastar used sale proceeds to repay $15 million of the credit facility, which remains fully drawn.

asset acquisition disposition

Gastar signed three deals: a credit facility amendment that keeps the borrowing base at $100 million (next review November 2016) and loosens the interest coverage test; a deal with an investor (STACK Exploration LLC) to fund and jointly drill up to 60 wells on about 18,000 net acres in Kingfisher County, with the investor paying 90% of Gastar's share of well costs to earn 80% of its working interest, reverting toward Gastar at 15% and 20% investor returns; and a ~$71 million sale of non-core Canadian/Kingfisher County leases to Red Bluff Resources (up to $10 million contingent), expected to close by Nov 18, 2016. This follows the earlier $100M borrowing base cut and the Kingfisher sale thread; the sale also requires at least 20% of net proceeds to repay the credit facility.

material agreement

Gastar launched an underwritten public offering of up to 57.5 million new common shares (including a 7.5 million-share over-allotment option) through Seaport Global Securities and Johnson Rice, closing scheduled May 17, 2016; this is dilutive to existing shareholders, and proceeds are for general corporate purposes and may be used to repay credit facility amounts. The board amended the January 2016 Rights Agreement so board-approved buyers in the offering are not treated as an 'Acquiring Person'. Lenders also permanently waived an unintended credit agreement default caused by the timing of March 2016 preferred dividend payments (paid March 31, 2016). Offering price and proceeds are not stated in this filing.

security holder rights change

Gastar closed the Appalachian Basin sale on April 8, 2016 to TH Exploration II, LLC, an affiliate of Tug Hill, for $80.0 million before adjustments; cash proceeds were about $76.6 million after adjustments (including the buyer assuming about $2.8 million of revenue suspense liabilities). Gastar cut its revolver borrowings by $80.0 million, and the borrowing base was automatically reduced to $100.0 million under Amendment No. 8. This completes the West Virginia exit and leaves Oklahoma as its only operating area described in the release.

asset acquisition disposition

Gastar agreed on Feb 19, 2016 to sell substantially all of its producing assets and proved reserves and a significant portion of its undeveloped acreage in the Appalachian Basin (the West Virginia Marcellus and Utica/Point Pleasant assets that had been marketed since Oct 2015) to an affiliate of Tug Hill Inc. for $80.0 million, expected to close on or before March 31, 2016. This resolves the open question of a buyer and price; proceeds are to reduce revolving credit borrowings. The filing also reports year-end 2015 proved reserves of 55.9 MMBoe (down 45%, which Gastar attributes to lower commodity prices), a preliminary 2016 capital budget of about $37.0 million, and the second Meramec well started drilling Feb 10, 2016.

material agreement

On Dec 22, 2015 Gastar signed Amendment No. 6 to its credit agreement, which allows it to exchange its outstanding Second Lien Debt notes for common equity. The filing does not say whether any exchange is planned or at what terms; if one happened (an inference), it would add shares and could dilute current holders.

material agreement

On Dec 16, 2015 Gastar closed the Husky acquisition announced in October, paying about $42.1 million from its revolving credit facility and conveying about 11,000 net acres to the sellers. The joint venture agreements with Husky are dissolved and the lawsuits between the parties were dismissed, resolving that thread. Gastar also reported its first operated Meramec Shale well (Deep River 30-1H) peaking at 1,094 Boe/day (71% oil) at a cost of $6.4 million.

asset acquisition disposition

On Oct 14, 2015 Gastar agreed to buy extra interests in 103 gross (10.2 net) producing Oklahoma wells and acreage from its joint venture partner Husky Ventures and others for about $43.3 million, funded from its revolving credit facility, and to hand over about 11,000 net non-core acres; the partnership agreements with Husky would be dissolved. The deal also settles lawsuits between Gastar and Husky, and the settlement would be rescinded if the purchase is terminated. Gastar also said it has hired Tudor, Pickering, Holt & Co. to market its West Virginia Marcellus and Utica assets, a major shift from the Marshall County assets that were the bulk of its production earlier in the story.

material agreement

In May 2015 Gastar agreed (May 1) to sell non-core Oklahoma assets in Kingfisher County (38 gross/16.7 net wells, about 19,000 net acres) to an undisclosed private buyer for about $46.2 million, closing by June 22, 2015, with proceeds first used to reduce its revolving credit facility. It also set up a May 7 at-the-market program with MLV & Co. to sell up to $50.0 million of common stock over time, with a commission of up to 3.0%; the stock sales may dilute shareholders if used, and no shares sold are reported here.

material agreement

On Sept 18, 2014 Gastar agreed with Barclays, Johnson Rice and Wells Fargo Securities to sell up to 19,550,000 new common shares (including an option for 2,550,000 more) under its existing shelf registration, with closing scheduled Sept 24, 2014. Issuing this many shares dilutes existing holders (compared with the 61.2 million shares outstanding at Nov 2013); the filing gives no price or proceeds, and Gastar agreed not to sell more stock for 90 days without Barclays' consent.

material agreement

Gastar said its Marshall County, West Virginia (Marcellus) production has been shut in since April 5, 2014 because a Williams Partners pipeline ruptured; that production is about two-thirds of its average daily production. It hopes to restart as early as Tuesday night (April 8), and expects roughly two weeks of temporary operation, with gas re-routed by Williams and condensate trucked to sales, depending on repairs. The filing also reports April 2014 monthly dividends on the Series A ($0.179688 per share) and Series B ($0.223958 per share) preferred, payable April 30 to holders of record April 15. The filing gives no estimate of the financial impact of the outage.

production update

On March 12, 2014 Gastar signed Amendment No. 3 to its Wells Fargo-led revolving credit facility, letting it leave immaterial subsidiaries out of the guarantor group, the facility's merger/acquisition, restricted-payment and investment covenants, and the borrowing base calculation. The same filing furnished the Q4 2013 results release: net loss to common stockholders of $3.3 million ($0.06 per share), or adjusted net income of $0.7 million after a $2.8 million hedge mark-to-market loss and $1.2 million of one-time restructuring/acquisition charges; revenue before hedging rose 99% to $29.2 million and production rose 30% to 55.2 MMcfe/d. Liquids were about 65% of production revenue. This is the first full-quarter picture including the WEHLU purchase (closed Nov 15, 2013) and the East Texas sale (Oct 2, 2013).

material agreement

On Nov 15, 2013 Gastar USA completed the West Edmond Hunton Lime Unit purchase from Lime Rock: about 24,000 net acres in Kingfisher, Logan and Oklahoma Counties, Oklahoma, with 56 gross (55.0 net) producing wells, for about $187.5 million cash subject to adjustments. It was paid for with net proceeds of the 10.75% Series B Preferred Stock (closed Nov 7), a new $125 million add-on of 8 5/8% Senior Secured Notes due 2018 (closed Nov 15), and cash on hand. This resolves the pending acquisition announced in September and the financing questions it left open. The notes bring the total to $325 million under the same indenture. Holders can require repurchase at 101% on a change of control, and an exchange-offer registration must become effective within 360 days.

asset acquisition disposition

the New York Stock Exchange certified Gastar Exploration Inc.'s securities for listing, clearing them to begin trading.

listing compliance notice

The East Texas sale to Cubic closed: closing documents were signed Sept 30, 2013 and held in escrow, and on Oct 2 Gastar Texas received the remaining $39.2 million in addition to Cubic's $4.7 million deposit, for a price of $43.9 million after adjustments. This resolves the months-long delayed sale. The filing also furnishes the October dividend announcement for the Series A Preferred.

material agreement

Gastar's subsidiary agreed on Sept 4, 2013 to buy a 98.3% working interest (80.5% net revenue interest) in about 24,000 net acres of the West Edmund Hunton Lime Unit in Oklahoma from Lime Rock Resources entities for $187.5 million cash, effective Aug 1, 2013, with closing expected Nov 26, 2013. A 5% deposit is in escrow, and funding is described as possible new long-term debt, possible perpetual preferred stock, revolver borrowings, cash on hand and expected East Texas sale proceeds. It extends the Hunton build-up after the Chesapeake deal and the Newfield sale, and relies on financing not yet arranged. The press release says the property produces about 2,078 BOE per day and the acreage is held by production; the filing says 24,000 net acres while the release headers mention 24,500 once. The company also says it intends to look for a partner to help acquire and develop the acreage.

material agreement

Gastar closed the sale of about 76,000 net undeveloped Oklahoma acres in Kingfisher and Canadian Counties to Newfield Exploration Mid-Continent on August 6, 2013, for expected net proceeds of about $60.1 million, after receiving back 1,850 net acres (the earlier figure was about 2,260). The sale is booked as a reduction of capitalized costs, with no gain and no effect on the income statement. Management says this recouped most of the investment in the Chesapeake acreage while keeping its core Hunton acreage, leaving about 136,800 gross (96,400 net) Hunton acres. This resolves the pending Oklahoma sale thread and names the previously unnamed buyer.

asset acquisition disposition

Gastar agreed to sell about 76,000 net acres of Kingfisher and Canadian County, Oklahoma leasehold, part of the acreage bought from Chesapeake on June 7, to an unnamed buyer for about $62.0 million, with closing due by August 6, 2013. Gastar will receive about 2,260 net acres back through a lower price. The press release also says its partner in the original Oklahoma joint area has chosen to buy about 12,820 net acres from Gastar for $12.1 million, and that Cubic Energy's East Texas closing was moved to July 12. Together these let Gastar recover most of the cost of the Chesapeake deal while keeping its core Hunton acreage.

material agreement

Gastar closed the Chesapeake Oklahoma acquisition on June 7, 2013, along with the buyback of Chesapeake's 6,781,768 shares and the settlement of the Texas lawsuit, for about $84.0 million in total (subject to adjustments), paid with the May notes proceeds. The same day it signed a new credit agreement with Wells Fargo (initial $50.0 million borrowing base, maturing November 14, 2017) and an intercreditor agreement putting the notes' liens behind the revolver's. The Cubic East Texas sale was pushed to a June 28 closing, with the price reduced for excluded assets. Michael McCown was named Senior Vice President and Chief Operating Officer, and the change-of-control severance plan was amended for that role. This resolves the pending Chesapeake deal and buyback, and the Chesapeake shareholding is gone.

asset acquisition disposition

Gastar's subsidiary Gastar USA issued $200 million of 8 5/8% Senior Secured Notes due May 15, 2018, with the money held in escrow until the Chesapeake Oklahoma acquisition closes. If that deal is not completed by June 30, 2013 (or the purchase agreement is terminated earlier), the notes will be redeemed at 100% of the initial offering price plus accrued interest. Separately, Wells Fargo replaced Amegy Bank as administrative and collateral agent on the existing credit agreement. This is the debt financing flagged as an open thread after the April Chesapeake deal.

debt financing

Gastar agreed to sell its Hilltop-area East Texas leasehold (about 16,300 net acres in Leon and Robertson Counties, with producing wells) to Cubic Energy for about $46.0 million cash, with closing expected on or before June 5, 2013. Proceeds will first pay down the revolving credit facility. This follows the earlier mention of possible East Texas sales as a way to fund the Chesapeake Oklahoma deal; the press release says it expects a net liquidity increase of about $25 million.

material agreement

Gastar agreed to buy about 157,000 net acres of Oklahoma leasehold, including interests in 176 producing wells, from Chesapeake affiliates for about $74.2 million in cash. In a linked settlement of Chesapeake's lawsuit, Gastar will pay about $10.8 million, of which about $9.8 million buys back Chesapeake's 6,781,768 shares (about 9.9% of the shares). The roughly $85 million total is to be funded from revolver borrowings, possible East Texas asset sales, and debt or preferred stock, and closing is targeted by June 7, 2013.

material agreement

the New York Stock Exchange certified Gastar Exploration Inc.'s securities for listing, clearing them to begin trading.

listing compliance notice