Each one in plain English, with the numbers worked through for a shareholder.
23 Apr 2013material agreement● NeutralMajor
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.
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.
Gastar USA and its lenders, led by Amegy Bank, signed a fourth amendment to its 2009 credit agreement, extending the maturity of borrowings to September 30, 2015. It also lets Gastar USA hedge up to 100% of its proved developed producing reserves using hedges other than floors and protective spreads, and caps outstanding LIBO Rate Loans at ten.
Gastar filed Amendment No. 2 to the same notes exchange registration, still not yet effective. The visible text repeats the same $100 million exchange offer terms, and the excerpt does not show what changed; one visible difference is that the Australian CBM description now mentions only New South Wales (Victoria is dropped from that sentence).
Gastar filed Amendment No. 1 to the April registration for swapping its $100 million 12 3/4% Senior Secured Notes due 2012 into registered notes. The visible text repeats the original offer terms, and the excerpt does not show what changed.
Gastar's U.S. subsidiary filed to swap its $100 million of 12 3/4% Senior Secured Notes due 2012 (sold November 29, 2007) for identical notes registered with the SEC, so they can be freely traded. The company receives no cash from the swap, and the terms are substantially the same apart from the removal of transfer restrictions.
