California Resources Corporation Announces: Early Participation Results, Extension of Deadline to Receive Early Participation Premium and Upsize of its Offers to Exchange Outstanding Senior Notes for New 8.00% Senior Secured Second Lien Notes Due 2022
California Resources Corporation (NYSE: CRC), today announced the early
participation results of its private offers to exchange (the “Exchange
Offers”) CRC’s newly issued 8.00% Senior Secured Second Lien Notes due
2022 (the “New Secured Notes”) for certain of its outstanding 5.0%
Senior Notes due 2020 (the “5% Notes”), 5.5% Senior Notes due 2021 (the
“5½% Notes”) and 6.0% Senior Notes due 2024 (the “6% Notes” and
together, the “Old Notes”) held by Eligible Holders (as defined below).
As of 5:00 p.m. New York City time on November 25, 2015, approximately
$3,292 million in aggregate principal amount of the Old Notes,
representing 65.8% of the outstanding principal amount of the Old Notes,
had been validly tendered (and not validly withdrawn) pursuant to the
Exchange Offers.
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Principal Amount of New Secured Notes(1)
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Title of Old Notes
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Principal Amount Outstanding (in millions)
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Exchange Consideration
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Early Participation Premium
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Total Exchange Consideration(2)
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Principal Amount Tendered
(in millions)
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5% Notes due 2020
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$1,000
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$750
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$50
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$800
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$549
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5½% Notes due 2021
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$1,750
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$750
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$50
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$800
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$1,078
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6% Notes due 2024
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$2,250
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$750
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$50
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$800
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$1,665
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(1) For each $1,000 principal amount of Old Notes.
(2) Includes
Early Participation Premium.
CRC also announced today that the aggregate principal amount of Old
Notes to be accepted in the Exchange Offers has increased from $1
billion to $2.8125 billion (the “Maximum Exchange Amount”). As a result
of this upsize, CRC has extended the early participation deadline of its
Exchange Offers (the “Early Participation Time”) to 5:00 p.m., New York
City time on December 1, 2015. All other terms of the Exchange Offers,
as previously announced, remain unchanged.
After giving effect to the upsize, and based on the principal amount of
Old Notes tendered as of 5:00 p.m. New York City time on November 25,
2015, approximately $2,250 million in principal amount of New Secured
Notes would be issued in the Exchange Offers. The actual principal
amount of New Secured Notes to be issued in respect of the Old Notes
tendered may vary from the principal amount set forth above and will be
based on the actual principal amount of Old Notes validly tendered (and
not validly withdrawn) in the Exchange Offers at or prior to the Early
Participation Time or Expiration Time and the corresponding proration
factor. Based on participation to date, approximately 85.4% of Old Notes
validly tendered in the Exchange Offers will be accepted for exchange.
Holders who have already validly tendered (and not validly withdrawn)
their Old Notes do not need to re-tender their Old Notes. Under the
terms of the Exchange Offers, holders who have previously tendered their
Old Notes can no longer validly withdraw those notes from the Exchange
Offers, except to the extent required by law.
Validly tendered Old Notes will be accepted for exchange upon the terms
and subject to the conditions set forth in the offering memorandum
described below on a pro rata basis in proportion to the
aggregate principal amount of Old Notes validly tendered (and not
validly withdrawn) by the Expiration Time, with no series of Old Notes
having priority over any other series of Old Notes to be exchanged
pursuant to the Exchange Offers, except that Old Notes validly tendered
(and not validly withdrawn) at or before the Early Participation Time
will be accepted for exchange before any Old Notes validly tendered (and
not validly withdrawn) after the Early Participation Time.
For each $1,000 in principal amount of Old Notes validly tendered (and
not validly withdrawn) at or prior to the Early Participation Time and
accepted for exchange by CRC, each Eligible Holder will receive “Total
Exchange Consideration” consisting of $800 in principal amount of the
New Secured Notes, which includes the “Early Participation Premium” of
$50 in principal amount of New Secured Notes. For each $1,000 in
principal amount of Old Notes validly tendered after the Early
Participation Time, Eligible Holders will be eligible to receive only
the “Exchange Consideration” of $750 in principal amount of New Secured
Notes.
In addition to the Exchange Consideration or Total Exchange
Consideration, as applicable, CRC will pay in cash accrued and unpaid
interest on Old Notes accepted in the Exchange Offers from the
applicable last interest payment date to, but not including the
Settlement Date for the Exchange Offers. Interest on the New Secured
Notes will accrue from the Settlement Date.
The Exchange Offers are being conducted upon the terms and subject to
the conditions set forth in the offering memorandum, dated November 12,
2015, and the related letter of transmittal. Documents relating to the
Exchange Offers will only be distributed to “Eligible Holders” of Old
Notes who complete and return an eligibility form confirming that they
are either a “qualified institutional buyer” under Rule 144A or not a
“U.S. person” under Regulation S for purposes of applicable securities
laws.
The consummation of the Exchange Offers is subject to, and conditional
upon, the satisfaction or waiver of certain conditions, including, among
other things, the entry into a security agreement and related
intercreditor agreement whereby the New Secured Notes and related
guarantees will be secured by a second-priority lien on assets of CRC
and certain of its material subsidiaries. The Exchange Offers are not
subject to any minimum amount of Old Notes being tendered.
The New Secured Notes have not been and will not be registered under the
U.S. Securities Act of 1933, as amended (the “Securities Act”), or under
any state securities laws. The New Secured Notes may not be offered or
sold within the United States, absent registration or an applicable
exemption from registration requirements.
This press release does not constitute an offer to sell or a
solicitation of any offer to buy 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. This
press release is being issued pursuant to Rule 135c under the Securities
Act.
About California Resources Corporation
California Resources Corporation is the largest oil and natural gas
exploration and production company in California on a gross-operated
basis. The Company operates its world class resource base exclusively
within the State of California, applying integrated infrastructure to
gather, process and market its production. Using advanced technology,
California Resources Corporation focuses on safely and responsibly
supplying affordable energy for California by Californians.
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