Alta Mesa Resources, Inc. Provides Bank Borrowing Update; Retains Financial Advisor; Receives NASDAQ Notice Regarding Non-Com...
09 April 2019 - 6:30AM
Alta Mesa Resources, Inc. (NASDAQ: AMR, “Alta Mesa” or the
“Company”) today announced that Alta Mesa Holdings, LP (“AMH”) had
drawn substantially all of the remaining capacity under its senior
secured revolving credit facility (the “Credit Facility”).
The Credit Facility had a borrowing base of $370 million after the
most recent borrowing base determination on April 1, 2019, which
decreased the borrowing base by $30 million. The cash held
following the draw, approximately $86 million, is intended for
general corporate purposes.
James Hackett, the Executive Chairman of the Company’s Board of
Directors and the Company’s Interim Chief Executive Officer,
stated, “In this challenging environment, we believe it is
important to increase our liquidity to ensure we have adequate
financial flexibility. We will continue to explore our options to
strengthen our balance sheet, including options to address our
indebtedness.”
Alta Mesa has retained Perella Weinberg Partners and Tudor
Pickering Holt & Co. as its financial advisor to assist with
analyzing and considering financial alternatives.
Alta Mesa today also announced that The NASDAQ Stock Market LLC
(“NASDAQ”) notified the Company on April 2, 2019 that it is not in
compliance with NASDAQ Listing Rule 5250(c)(1) for continued
listing due to the delay in filing its Annual Report on Form 10-K
for the year ended December 31, 2018 (the “Annual
Report”).
The notification from NASDAQ notes that Alta Mesa is required to
submit a plan to regain compliance with NASDAQ's filing
requirements for continued listing within 60 calendar days from the
date of notification, or by June 1, 2019. Upon acceptance of the
Company's compliance plan, NASDAQ is permitted to grant an
extension of up to 180 calendar days from the Annual Report's
filing due date, or until September 30, 2019, for the Company to
regain compliance with NASDAQ's filing requirements for continued
listing. The notice has no immediate effect on the listing of the
Company’s Class A Common Stock on the NASDAQ’s exchange.
The Annual Report was not filed with the Securities and Exchange
Commission within the prescribed time period because the Company
needs additional time to complete its financial statements and
related disclosures. As previously announced, the Company
expects to report material weakness in its internal control over
financial reporting in the 2018 Form 10-K. The Company has taken
additional time to ensure the accuracy of its 2018 financial
information, to complete the required discussion and analysis of
the business and to finalize the conclusions regarding the
assessment of internal control. Although the Company is still
completing its testing of internal control, it has not identified
material misstatements to its previously filed financial
information and believes that no restatements to historical periods
will be required. While covenant relief was not attained
during the borrowing base redetermination, the Company continues to
be in discussions with its lenders under the Credit Facility. If
unsuccessful in obtaining relief, the Company may be unable to
comply with the terms of the Credit Facility during 2019, which
would permit the lenders to cease making amounts available under
the Credit Facility, to require cash collateral for outstanding
letters of credit and to exercise other rights under the Credit
Facility.
Alta Mesa is working to complete the Annual Report and intends
to file it within the time frame required to regain compliance with
NASDAQ’s listing standards.
Alta Mesa also announced today that NASDAQ notified the Company
on April 3, 2019 that it is not in compliance with the minimum bid
price requirement set forth in the NASDAQ rules for continued
listing. NASDAQ Listing Rule 5550(a)(2) requires listed securities
to maintain a minimum bid price of $1.00 per share, and NASDAQ
Listing Rule 5810(c)(3)(A) provides that a failure to meet the
minimum bid price requirement exists if the deficiency continues
for a period of 30 consecutive business days. The notice has no
immediate effect on the listing of the Company’s Class A Common
Stock on NASDAQ’s exchange. In accordance with NASDAQ Listing Rule
5810(c)(3)(A), the Company has been provided 180 calendar days, or
until September 30, 2019, to regain compliance with NASDAQ Listing
Rule 5550(a)(2). To regain compliance, the Company's common shares
must have a closing bid price of at least $1.00 for a minimum of 10
consecutive business days. In the event the Company does not regain
compliance by September 30, 2019, the Company may be eligible for
additional time to regain compliance or may face delisting.
The Company intends to monitor the closing bid price of its
common shares between now and September 30, 2019 and intends to
cure the deficiency within the prescribed compliance period. The
Company's business operations are not affected by the receipt of
the notice.
Safe Harbor Statement and Disclaimer:
This press release includes "forward-looking statements" within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. All statements, other than statements of historical fact,
including but not limited to, Alta Mesa’s fourth quarter and
year-end financial and operating results, 2019 outlook and
guidance, including estimates with respect to the timing of the
filing of the Company’s Annual Report on Form 10-K, anticipated
restatements, the ability to obtain the requested covenant relief
and objectives of management are forward-looking statements. When
used in this press release, the words “could”, “should”, “will”,
“plan”, “believe”, “anticipate”, “intend”, “estimate”, “expect”,
“project” and similar expressions are intended to identify
forward-looking statements, although not all forward-looking
statements contain such identifying words. These forward-looking
statements are based on Alta Mesa’s current expectations and
assumptions about future events and are based on currently
available information as to the outcome and timing of future
events. Alta Mesa cautions you that these forward-looking
statements are subject to all of the risks and uncertainties, most
of which are difficult to predict and many of which are beyond its
control, incident to the exploration for and development and
production of oil and gas. Should one or more of the risks or
uncertainties described in this press release occur, or should
underlying assumptions prove incorrect, Alta Mesa’s actual results
and plans could differ materially from those expressed in any
forward-looking statements. Factors that could cause results
to differ materially from expected results include, but are not
limited to, the results and finalization of the Company’s financial
statements and audits, the outcome of the Company’s discussions
with its lenders, which would have an adverse impact in the
evaluation of the Company’s ability to continue as a going concern
if its borrowing base is lowered further or the covenant relief is
not obtained, and other risks found in Alta Mesa’s filings with the
SEC, including its Forms 10-K, 10-Q and 8-K, which can be obtained
free of charge on the SEC's web site at http://www.sec.gov. Any
emphasis by the Company, AMH or its auditors in their opinion
regarding substantial doubt about the Company’s or AMH’s ability to
continue as a going concern would not constitute a covenant
violation under AMH’s credit facility or indenture. All
forward-looking statements, expressed or implied, included in this
press release are expressly qualified in their entirety by this
cautionary statement. This cautionary statement should also be
considered in connection with any subsequent written or oral
forward-looking statements that we may issue. Except as otherwise
required by applicable law, Alta Mesa disclaims any duty to update
any forward-looking statements, all of which are expressly
qualified by the statements in this section, to reflect events or
circumstances after the date of this press release.
Alta Mesa Resources, Inc. is an independent energy company
focused on the development and acquisition of unconventional oil
and natural gas reserves in the Anadarko Basin in Oklahoma, and
through Kingfisher Midstream, LLC, provides best-in-class midstream
energy services, including crude oil and gas gathering, processing
and marketing and produced water disposal to producers in the STACK
play.
FOR MORE INFORMATION CONTACT: Bruce
Connery, IR@altamesa.net, 281-943-5597
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