1 Oct 2018listing compliance notice▼ BadMajor
LEGACY RESERVES LP terminated the registration of a class of securities, ending its reporting obligation for them.
Announcements, explained
Each one in plain English, with the numbers worked through for a shareholder.
21 Sept 2018debt financing● NeutralMajor
The September 14 note swap was completed on September 20, 2018: $21.004 million of 8% 2020 notes and $109 million of 6.625% 2021 notes were exchanged for $130.004 million of new 8% convertible notes due 2023, plus 105,020 New Legacy shares to the 2020 noteholders. The new notes convert at $6.00 per share, and holders who convert early get a cash payment ($80.00 per $1,000 through Nov 30, 2018, falling to $24.22 by September 19, 2019). The revolver (Eleventh Amendment) and GSO term loan (Sixth Amendment) were amended to allow redeeming senior notes using refinancing debt, equity sale proceeds or equity exchanges. This resolves the pending exchange and, if the notes convert, would add shares.
20 Sept 2018listing compliance notice● NeutralMajor
LEGACY RESERVES LP's exchange filed to remove a class of its securities from listing.
18 Sept 2018business combination● Neutral
Ahead of the September 19 unitholder vote on the reorganization into New Legacy, the boards approved a change letting executives who hold cash-settled phantom units choose to reinvest that cash in New Legacy stock. They must do so as needed to keep total cash paid for merger-related incentive awards at or under $30 million. Unvested incentive awards fully vest when the merger closes, and the cash awards are to be paid within 74 days after closing. This continues the reorganization thread; no new figures on the merger terms themselves.
14 Sept 2018capital raising announcement● NeutralMajor
On September 14, 2018 Legacy agreed to swap $21.004 million of 2020 notes and $109 million of 2021 notes for new 8% convertible notes due 2023 (convertible at $6.00 per share), plus 105,020 New Legacy shares for the 2020 note holders. The swap is expected to close September 20, 2018 and depends on the corporate reorganization closing; lenders under the revolver and the GSO term loan amended their agreements to allow it. This continues the earlier pattern of swapping older notes for other securities, and could add shares if the new notes convert.
3 Aug 2018business combination● NeutralMajor
Legacy sent unitholders the final proxy statement/prospectus for a September 19, 2018 special meeting to vote on the merger that would turn the partnership into a subsidiary of New Legacy, a corporation whose common stock is expected to list on Nasdaq as LGCY. Unitholders also vote on a classified board, a new 2018 incentive plan and an advisory vote on executive compensation. New Legacy would also buy the general partner's interests from Lion GP Interests, LLC for $3.0 million cash. The board unanimously recommends voting for all of these; the filing says the board believes the MLP structure is no longer in the partnership's best interests.
12 July 2018business combination● NeutralMajor
Legacy settled the preferred unitholders' lawsuit challenging the corporate reorganization: if the Delaware court approves (hearing set for September 12, 2018), Series A and B preferred holders get about 10,730,000 extra New Legacy shares on top of about 16,913,592 under the original terms, and the plaintiff's counsel fees of up to $5.7 million are to be paid from insurance. Under the amended merger agreement signed July 9, each Series A preferred unit converts into 2.92033118 New Legacy shares and each Series B unit into 2.90650421 shares, and a unitholder vote on a classified board is added, though closing does not depend on it. A separate Texas suit (Irish Action) remains, to be dismissed after the merger. This continues the reorganization begun in March 2018.
2 Apr 2018debt financing● NeutralMajor
Holders of the 8% 2020 notes (about 56.32%) and the 6.625% 2021 notes (about 69.78%) consented to changes in the note agreements, and on April 2, 2018 Legacy signed amendments allowing its planned conversion from a partnership into a corporation (Legacy Reserves Inc., 'New Legacy'). The amendments exclude the reorganization from the 'change of control' definition and add guarantees of the notes by New Legacy and the general partner. This moves forward the corporate reorganization announced March 26, 2018, which still needs unitholder approval.
5 Jan 2018capital raising announcement● NeutralMajor
On December 31, 2017 Legacy raised the maximum second lien term loan with GSO from $300 million to $400 million, extended borrowing availability to October 25, 2019, and relaxed the asset coverage covenant from 1.0x to 0.85x during 2018. Legacy also agreed to buy about $187.1 million principal of its 6.625% 2021 notes from Fir Tree funds for about $132.1 million (70 cents per dollar), funded with about $131 million of term loan borrowings on January 5, 2018 plus revolver borrowings for accrued interest. In addition it issued 3.8 million new units plus $2.5 million cash to a Fir Tree affiliate under a one-year standstill and voting agreement. This retires part of the 2021 notes at a discount but swaps it for more secured debt and new units (dilution is an inference).
28 Oct 2016debt financing▼ BadMajor
On October 25, 2016 Legacy signed a second lien term loan of up to $300 million with GSO Capital Partners funds as initial lenders. It is secured behind the bank revolver, bears 12.00% interest (partly payable in kind), and matures August 31, 2021 (earlier, August 1, 2020, if $15 million or more of the 8% 2020 notes remain on July 1, 2020); $60 million was drawn at signing to repay debt and the remaining $240 million is available for 12 months. The same day the revolver's borrowing base was cut from $630 million to $600 million with tighter covenants, and GSO got the right to name a ninth board director (D. Dwight Scott of Blackstone/GSO is the initial designee) plus rights to join up to 50% of future debt and equity offerings. This continues the credit tightening seen since the February 2016 amendment.
26 May 2016capital raising announcement● Neutral
Legacy agreed to exchange 2,719,124 new common units for $15.0 million principal amount of its 8% senior notes due 2020, with units expected to be issued June 1, 2016. The units are about 3.9% of outstanding units, so existing unitholders are diluted by that amount while debt falls by $15.0 million. This is the first debt-for-equity swap in this record.
24 Feb 2016debt financing▼ BadMajor
Effective February 19, 2016 Legacy amended its bank credit agreement (Seventh Amendment) with Wells Fargo as agent, cutting the borrowing base from $900 million to $725 million. It also tightened rules on cash sweeps, mortgage coverage (at least 90% of property value) and leverage limits, and set conditions for paying distributions. The amendment allows up to $400 million of secured second lien notes to be issued in exchange for existing senior unsecured notes, and sets limits on buying back preferred units and senior notes. The filing also references a Q4 2015 earnings press release, whose figures are not in the text.
6 Aug 2015asset acquisition disposition● NeutralMajor
On July 31, 2015 Legacy closed both July 3 deals: the $154 million Dew Gathering LLC (WGR) purchase of Texas gas gathering and processing assets, and the $286 million Anadarko oil and gas properties purchase, both subject to customary adjustments. The filing says the required financial statements for the acquisitions will follow later.
9 July 2015material agreement● NeutralMajor
On July 3, 2015 Legacy's operating subsidiary agreed to buy Dew Gathering LLC, which owns natural gas gathering and processing assets in six Texas counties, from WGR Operating LP for $154 million, and oil and gas properties from Anadarko E&P Onshore LLC for $286 million (both subject to customary adjustments). Both deals were expected to close July 31, 2015; the Dew Gathering deal also required clearance of the antitrust waiting period. Together this is $440 million of new purchases, the first acquisition agreements in this record since the Piceance deal in 2014.
16 Dec 2014business combination● Neutral
Legacy and its finance subsidiary filed a registration statement to swap up to $300 million of the 6.625% senior notes due 2021 issued in May 2014 for identical notes registered with the SEC. This is the registration step for the exchange flagged since the May 2014 issue; the new notes have the same terms but are freely tradable, and interest continues at 6.625% with the next payment June 1, 2015. The filing says the exchange expiry date is still blank and the registration is not yet effective.
9 Dec 2014director officer appointment● NeutralMajor
Cary Brown said he would step down as chief executive and president during the first half of 2015 after running Legacy since its 2005 founding, staying on as chairman. Paul Horne, the operating chief who had led the business from the start, was named successor and added to the board - an internal, pre-announced handover rather than a rupture.
8 Oct 2014material agreement● NeutralMajor
On October 3, 2014 Legacy agreed to sell 10,000,000 common units at $27.38 to the public ($26.43 net to Legacy), and the underwriters also exercised their option for 1,500,000 more units. Net proceeds are about $303.6 million, to be used for general purposes including future acquisitions or repaying part of the revolver; closing is scheduled October 8, 2014. This adds new common units, which dilutes existing unitholders' ownership share (inference), and is the first common unit sale in this record since November 2012.
24 June 2014listing compliance notice▲ GoodMajor
Nasdaq certified LEGACY RESERVES LP's securities for listing, clearing them to begin trading.
16 June 2014material agreement● NeutralMajor
On June 10, 2014 Legacy agreed to sell 7,000,000 8.00% Series B preferred units at $25.00 each ($24.2125 net to Legacy), for about $169.2 million net, closing scheduled June 17, 2014, with a 30-day option for 1,050,000 more. The 8% rate applies until June 15, 2024, then three-month LIBOR plus 5.256%. Proceeds will pay down the revolver and go to general purposes. This is a second preferred class after the April Series A, and ranks ahead of common unitholders for distributions (the Series A filing said preferred is senior to units).
4 June 2014asset acquisition disposition● NeutralMajor
On June 4, 2014 Legacy closed the Piceance Basin acquisition from a WPX Energy subsidiary, paying $355.0 million in cash (subject to adjustments) plus 300,000 incentive distribution units, of which 100,000 vested immediately and up to 200,000 more can vest with future transactions with Legacy. Its general partner adopted a Third Amended and Restated partnership agreement creating these units and the new distribution policy, which resolves the pending acquisition and amended-agreement items; the stated asset terms are unchanged from May (over 2,600 wells, 276 Bcfe proved reserves). Units not issued to WPX stay in treasury for the benefit of all limited partners.
28 May 2014debt financing● NeutralMajor
On May 22, 2014 Legacy amended its April 2014 credit agreement: the borrowing base rises from $800 million to $950 million once the recently announced acquisitions close and conditions are met. The cap on total debt to EBITDA is temporarily loosened from 4.00x to 4.50x through June 30, 2015, then returns to 4.00x, and minimum hedging requirements were adjusted for the larger base. This gives more borrowing room but also more allowed leverage for the acquisition period.
13 May 2014debt financing● NeutralMajor
On May 13, 2014 Legacy issued an additional $300 million of its 6.625% Senior Notes due 2021 at 99% of face value, for net proceeds of about $291.5 million, adding to the $250 million issued in May 2013 (so $550 million of these notes in total, by inference). The money is to fund part of the cash price of the Piceance Basin acquisition and general purposes, and meanwhile pays down the revolver; Legacy must offer to swap the notes for registered ones within 365 days. The same filing says the underwriters exercised in full their option for 300,000 more Series A preferred units, about $7.3 million net, closed May 12, and earmarked for the pending Chaves County, New Mexico and Sheridan County, Montana oil-weighted acquisitions.
6 May 2014material agreement● NeutralMajor
On May 2, 2014 Legacy agreed to buy a non-operated interest in Piceance Basin gas properties (Garfield County, Colorado) from a WPX Energy subsidiary for $355.0 million in cash plus a new class of incentive distribution units. The properties are 2,730 wells, with a working interest of about 29% rising to about 37% on Jan 1, 2015 and about 41% on Jan 1, 2016, and internally estimated proved reserves of 276 Bcfe (100% proved developed producing; 83% gas). Closing is expected before the end of June 2014 and requires an amended partnership agreement (no unitholder vote needed). The filing also describes a revised distribution policy under which the incentive units get extra cash distributions once payouts to unitholders pass targets set above current levels. This appears to be the larger of the two acquisitions announced March 26, 2014 (inference); the same 8-K carries a results press release (Item 2.02) whose figures are not in the text shown.
17 Apr 2014listing compliance notice▲ GoodMajor
Nasdaq certified LEGACY RESERVES LP's securities for listing, clearing them to begin trading.
16 Apr 2014material agreement● NeutralMajor
On April 10, 2014 Legacy agreed to sell 2,000,000 8% Series A cumulative redeemable perpetual preferred units at $25.00 each, with net proceeds of about $48.1 million, plus a 30-day option for 300,000 more. Closing is scheduled for April 17, 2014. The proceeds are meant to fund part of certain acquisitions (the two pending deals announced March 26, 2014, by inference) and general purposes, and will pay down the revolver in the meantime. The preferred units pay 8% until April 15, 2024, then a floating rate of three-month LIBOR plus 5.24%, and rank as a new class of equity alongside the common units.
2 Apr 2014debt financing● NeutralMajor
On April 1, 2014 Legacy signed a new five-year $1.5 billion secured revolving credit facility with Wells Fargo as agent, maturing April 1, 2019, replacing the March 2011 facility, which was repaid in full with the first borrowings. The borrowing base is $800 million (not conditional on the closing of two acquisitions announced March 26, 2014) with about $360 million drawn and about $440 million available. Key covenants cap total debt at 4.00x EBITDA, and the facility is secured by over 80% of oil and gas property value.
19 Dec 2013business combination● Neutral
On Dec 19, 2013 Legacy filed a separate S-4 to let holders exchange the $250 million 6.625% Senior Notes due 2021, issued in May 2013, for identical SEC-registered notes. This is the exchange offer promised when those notes were sold, following the same process as the 8% 2020 notes. Terms are identical apart from transfer restrictions and additional interest, and it raises no new money.
4 Dec 2013business combination● Neutral
On Dec 4, 2013 Legacy filed Amendment No. 1 to its S-4 for the exchange of the $300 million 8% Senior Notes due 2020, with the same terms as the October filing. The visible changes are an updated document list that adds the Q3 2013 10-Q (filed Nov 6, 2013) and a 2014 expiry year for the offer. The exchange is still not finished; the amendment alone does not show when it will complete.
11 Oct 2013business combination● Neutral
Legacy filed a registration statement (Form S-4) on Oct 11, 2013 to let holders swap the $300 million of 8% Senior Notes due 2020 issued in December 2012 for identical notes registered with the SEC and freely tradable. This fulfils the registration commitment on those notes; the terms are identical apart from the transfer restrictions and additional-interest provisions, and the exchange is not a taxable event. It adds no new money.
31 May 2013debt financing● Neutral
On May 28, 2013 Legacy completed the $250 million 6.625% Senior Notes due Dec 1, 2021 under an indenture with Wells Fargo as trustee, with interest paid each June 1 and Dec 1 starting Dec 1, 2013. The notes are callable at set prices, with a make-whole premium before June 1, 2017, and carry covenants limiting distributions, asset sales and additional debt. Legacy also agreed to register an exchange offer for the notes within 400 days of issuance.