HOUSTON, May 11, 2020 /PRNewswire/ -- Callon
Petroleum Company ("Callon" or the "Company") (NYSE: CPE) today
announced it has commenced a private exchange offer (the "Exchange
Offer") to each Eligible Holder (as defined below) of its 6.25%
Senior Notes due 2023 (the "2023 Notes"), its 8.25% Senior Notes
due 2025 (the "2025 Senior Notes" and, together with the 2023
Notes, the "Carrizo Notes"), its 6.125% Senior Notes due 2024 (the
"2024 Notes") and its 6.375% Senior Notes due 2026 (the "2026
Notes" and, together with the 2024 Notes, the "Callon Notes" and,
together with the Carrizo Notes, the "Old Notes") to exchange their
Old Notes for up to $300,000,000
aggregate principal amount (the "Maximum Exchange Amount") of newly
issued 8.00% Second Lien Senior Secured Notes due 2025 (the "New
Notes"), in each case upon the terms and subject to the conditions
set forth in the confidential offering memorandum and consent
solicitation statement, dated May 11,
2020 (the "Offering Memorandum").
The following table sets forth the consideration to be offered
to Eligible Holders of the Old Notes in the Exchange Offer:
Title of Series of
Old Notes
|
CUSIP No. /
ISIN
|
Aggregate
Outstanding Principal Amount
|
Early Exchange
Consideration (as defined below), if tendered and not withdrawn
prior to the
Early Tender Date (as defined
below)(1)
|
Late Exchange
Consideration (as defined below), if tendered after the Early
Tender Date and prior to the Expiration Date (as defined
below)(1)
|
Acceptance
Priority Level
|
6.25% Senior Notes
due 2023
|
144577AH6/US144577AH67
|
$650,000,000
|
$400
|
$350
|
1
|
|
|
|
|
|
|
6.125% Senior Notes
due 2024
|
13123XAT9/US13123XAT90;
13123XAU6/US13123XAU63;
AN7061566/USU1303XAD85
|
$600,000,000
|
$400
|
$350
|
2
|
|
|
|
|
|
|
8.25% Senior Notes
due 2025
|
144577AJ2/US144577AJ24
|
$250,000,000
|
$400
|
$350
|
3
|
|
|
|
|
|
|
6.375% Senior Notes
due 2026
|
13123XAZ5/US13123XAZ50
|
$400,000,000
|
$400
|
$350
|
4
|
|
|
(1)
|
Total principal
amount of New Notes for each $1,000 principal amount of Old Notes
tendered and accepted for exchange.
|
Eligible Holders who tender their Old Notes at or prior to
5:00 p.m., New York City Time, on
May 22, 2020, unless extended (such
time and date as it may be extended, the "Early Tender Date"), will
be eligible to receive $400 principal
amount of New Notes (the "Early Exchange Consideration") for each
$1,000 principal amount of Old Notes
tendered and accepted for exchange. Eligible Holders tendering Old
Notes after the Early Tender Date and at or prior to 11:59 p.m., New York
City time, on June 8, 2020,
unless extended (such time and date as it may be extended, the
"Expiration Date"), will be eligible to receive $350 principal amount of New Notes (the "Late
Exchange Consideration") for each $1,000 principal amount of Old Notes tendered for
exchange. In the event that the aggregate amount of New Notes to be
issued in respect of Old Notes validly tendered (and not validly
withdrawn) would exceed the Maximum Exchange Amount, Old Notes will
be accepted on a prorated basis within the applicable Acceptance
Priority Level.
In addition to the consideration described above, the Company
will pay in cash accrued and unpaid interest on the Old Notes
accepted in the Exchange Offer from the applicable latest interest
payment date to, but not including, the settlement date for the
Exchange Offer, which will occur promptly after the Expiration Date
and is expected to occur on June 10,
2020. Interest on the New Notes will accrue from the date of
issuance of the New Notes.
In conjunction with the Exchange Offer, the Company is
soliciting consents (the "Consent Solicitations") from holders of
each series of Old Notes ("Consents") to certain proposed
amendments to the indentures governing each of the Old Notes (the
"Old Notes Indentures") to eliminate substantially all of the
restrictive covenants and certain of the default provisions
contained therein (the "Proposed Amendments"). The Company must
receive Consents from holders representing a majority of the
outstanding principal amount of each series of Old Notes to adopt
the Proposed Amendments with respect to the applicable Old Notes
Indenture (the "Requisite Consents"). Following consummation of the
Exchange Offer and the Consent Solicitations, any holders of the
Old Notes that do not participate in the Exchange Offer would rank
effectively junior to the New Notes to the extent of the value of
the collateral securing the New Notes.
Eligible Holders of Old Notes may not tender Old Notes without
delivering the related Consents, and Eligible Holders of Old Notes
may not deliver Consents without tendering the related Old Notes.
The Exchange Offer and Consent Solicitations may be terminated,
withdrawn, amended or extended at any time and for any reason.
Neither of the Exchange Offer is conditioned upon any minimum
amount of Old Notes tendered or the receipt of the Requisite
Consents to the Proposed Amendments.
Tenders of Old Notes in the Exchange Offer may be validly
withdrawn at any time prior to 5:00
p.m., New York City time,
on May 22, 2020, unless extended (as
it may be extended, the "Withdrawal Deadline"). Old Notes
(including Old Notes tendered after the Withdrawal Deadline) may
not be withdrawn from the Exchange Offer and the related Consents
may not be revoked from the Consent Solicitations after the
Withdrawal Deadline, subject to applicable law.
The Exchange Offer and Consent Solicitations will only be
made, and the New Notes are only being offered and issued, to
holders of Old Notes who are (a) reasonably believed to be
"qualified institutional buyers" as defined in Rule 144A under the
Securities Act of 1933, as amended (the "Securities Act"), or (b)
not "U.S. persons" as defined in Rule 902 under the Securities Act
and are in compliance with Regulation S under the Securities Act
(any such holder, an "Eligible Holder"). Only Eligible Holders who
have completed and returned the eligibility letter are authorized
to receive or review the Offering Memorandum or to participate in
the Exchange Offer and Consent Solicitations. Eligible Holders
of the Old Notes who desire to obtain and complete an eligibility
form should contact the information agent and exchange agent, D.F.
King & Co., at (877) 896-3192 (toll-free) or (212) 269-5550
(for banks and brokers) or email cpe@dfking.com.
Eligible Holders of the Old Notes are urged to carefully read
the Offering Memorandum before making any decision with respect to
the Exchange Offer and Consent Solicitations. None of the Company,
the dealer managers, the trustees with respect to the Old Notes and
the New Notes, the information and exchange agent or any affiliate
of any of them makes any recommendation as to whether Eligible
Holders of the Old Notes should exchange their Old Notes for New
Notes in the Exchange Offer, and no one has been authorized by any
of them to make such a recommendation. Eligible Holders must make
their own decision as to whether to tender Old Notes and, if so,
the principal amount of Old Notes to tender.
The New Notes and the Exchange Offer have not been and will not
be registered with the U.S. Securities and Exchange Commission
under the Securities Act, or any state or foreign securities laws.
The New Notes may not be offered or sold in the United States or for the account or
benefit of any U.S. persons except pursuant to an exemption from,
or in a transaction not subject to, the registration requirements
of the Securities Act. The Exchange Offer and Consent Solicitations
are not being made to Eligible Holders of Old Notes in any
jurisdiction in which the making or acceptance thereof would not be
in compliance with the securities, blue sky or other laws of such
jurisdiction. This press release is for informational purposes only
and is not an offer to purchase or a solicitation of an offer to
purchase or sell any securities, nor shall there be any sale of any
securities in any jurisdiction in which such offer, solicitation or
sale would be unlawful prior to registration or qualification under
the securities laws of any such jurisdiction.
Callon Petroleum Company
Callon Petroleum Company is an independent oil and natural gas
company focused on the acquisition, exploration, and development of
high-quality assets in the leading oil plays of South and
West Texas.
Cautionary Note Regarding Forward-Looking Statements
This news release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section
21E of the Securities Exchange Act of 1934. Forward-looking
statements include all statements regarding the Company's Exchange
Offer and Consent Solicitations; wells anticipated to be drilled
and placed on production; future levels of drilling activity and
associated production and cash flow expectations; the Company's
production guidance and capital expenditure forecast; estimated
reserve quantities and the present value thereof; anticipated
returns and financial position; and the implementation of the
Company's business plans and strategy, as well as statements
including the words "believe," "expect," "may," "will," "forecast,"
"outlook," "plans" and words of similar meaning. These statements
reflect the Company's current views with respect to future events
and financial performance based on management's experience and
perception of historical trends, current conditions, anticipated
future developments and other factors believed to be appropriate.
No assurances can be given, however, as of this date, that these
events will occur or that these projections will be achieved, and
actual results could differ materially from those projected as a
result of certain factors. Any forward-looking statement speaks
only as of the date of which such statement is made and the Company
undertakes no obligation to correct or update any forward-looking
statement, whether as a result of new information, future events or
otherwise, except as required by applicable law. Some of the
factors which could affect our future results and could cause
results to differ materially from those expressed in our
forward-looking statements include the volatility of oil, natural
gas and natural gas liquids ("NGLs") prices or a prolonged period
of low oil, natural gas or NGLs prices and the effects of actions
by, or disputes among or between, members of the Organization of
Petroleum Exporting Countries, such as Saudi Arabia and other oil and natural gas
producing countries, such as Russia, with respect to production levels or
other matters related to the price of oil, general economic
conditions, including the availability of credit and access to
existing lines of credit, the effects of excess supply of oil and
natural gas resulting from reduced demand caused by the COVID-19
pandemic and the actions of certain oil and natural gas producing
countries, our ability to drill and complete wells, operational,
regulatory and environment risks, cost and availability of
equipment and labor, our ability to finance our activities, the
ultimate timing, outcome and results of integrating the operations
of Carrizo and Callon and the ability of the combined company to
realize anticipated synergies and other benefits in the timeframe
expected or at all, and other risks more fully discussed in our
filings with the Securities and Exchange Commission (the "SEC"),
including our most recent Annual Report on Form 10-K and Quarterly
Report on Form 10-Q and subsequent Quarterly Reports on Form 10-Q,
available on our website or the SEC's website at www.sec.gov.
Contact:
Mark
Brewer
Director of Investor Relations
Callon Petroleum Company
ir@callon.com
(281) 589-5200
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SOURCE Callon Petroleum Company