UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of report (Date of earliest event reported): July 10, 2019

 

 

Magnolia Oil & Gas Corporation

(Exact name of registrant as specified in its charter)

 

 

 

Delaware   001-38083   81-5365682

(State or other jurisdiction of

incorporation or organization)

 

(Commission

File Number)

 

(I.R.S. Employer

Identification Number)

Nine Greenway Plaza, Suite 1300

Houston, Texas 77046

(Address of principal executive offices, including zip code)

(713) 842-9050

(Registrant’s telephone number, including area code)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

☐

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

☐

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

☐

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

☐

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading

Symbol(s)

 

Name of each exchange

on which registered

Class A Common Stock, par value $0.0001   MGY   NYSE
Warrants to purchase Class A Common Stock   MGY.WS   NYSE

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company  ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

 

 

 

Item 3.03

Material Modifications to Rights of Security Holders.

On July 10, 2019, Magnolia Oil & Gas Corporation (the “Company”) and Continental Stock Transfer & Trust Company (the “Warrant Agent”) entered into Amendment No. 1 (the “Warrant Amendment”) to the Warrant Agreement, dated as of May 4, 2017 (the “Warrant Agreement”), by and between the Company and the Warrant Agent. The Warrant Amendment amends the Warrant Agreement to provide the Company with the right to require the holders of the Company’s publicly traded warrants (the “Public Warrants”) and private warrants (the “Private Warrants” and, together with the Public Warrants, the “Warrants”) to exchange their Warrants for shares of the Company’s Class A common stock, par value $0.0001 (“Class A common stock”), at an exchange ratio of 0.261 shares of Class A common stock for each Warrant. The Company has the right to require the exchange of not less than all of the Warrants at any time while such Warrants are exercisable and prior to their expiration, at the office of the Warrant Agent, upon notice to the registered holders of the outstanding Warrants not less than fifteen days prior to the date of exchange fixed by the Company.

The foregoing description of the Warrant Amendment is qualified in its entirety by reference to the Warrant Amendment, which is filed as Exhibit 4.1 to this current report on Form 8-K and is incorporated by reference herein.

 

Item 5.07

Submission of Matters to a Vote of Security Holders.

As previously disclosed in the definitive consent solicitation materials filed by the Company with the U.S. Securities and Exchange Commission on July 3, 2019, in connection with the Company’s offer to each holder of the Warrants to receive 0.29 shares of Class A common stock in exchange for each Warrant tendered by the holder and exchanged pursuant to the offer (the “Offer”), the Company solicited consents (the “Consent Solicitation”) from holders of each of the Public Warrants and the Private Warrants to approve the Warrant Amendment. The Offer and Consent Solicitation expired at 11:59 p.m. Eastern Daylight Time on July 5, 2019. A total of 31,509,226 Warrants, or approximately 99.3% of the 21,666,650 outstanding Public Warrants and 100% of the 10,000,000 outstanding Private Warrants, were properly tendered and not withdrawn in the Offer, and were therefore deemed to have consented to the Warrant Amendment. Because consents were received from holders of more than a majority of each of the Company’s Private Warrants and Public Warrants, the Warrant Amendment was approved.

 

Item 8.01

Other Events.

On July 10, 2019, the Company issued a press release announcing the closing of the Offer and the Consent Solicitation. In connection with the closing, the Company issued 9,137,638 shares of Class A common stock in exchange for the Warrants tendered in the Offer, resulting in a total of 168,029,468 shares of Class A common stock outstanding as of July 10, 2019. The Company also announced that it intends to exchange all remaining untendered Warrants for shares of Class A common stock in accordance with the terms of the Warrant Agreement, as amended, on July 25, 2019.

A copy of the press release is attached as Exhibit 99.1 and is incorporated by reference herein.

 

Item 9.01

Financial Statements and Exhibits.

 

  (d)

Exhibits.

 

Exhibit
Number

  

Description

  4.1    Amendment No. 1 to Warrant Agreement, dated as of May 4, 2017, by and between the Company and the Continental Stock Transfer & Trust Company.
99.1    Press Release, dated July 10, 2019

 

2

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

    MAGNOLIA OIL & GAS CORPORATION
     
Date: July 10, 2019      
    By:  

/s/ Timothy D. Yang

    Name:   Timothy D. Yang
    Title:  

Executive Vice President, General Counsel and

Corporate Secretary

 

3

Exhibit 4.1

AMENDMENT NO. 1 TO WARRANT AGREEMENT

This Amendment (this “ Amendment ”) is made as of July 10, 2019 by and between Magnolia Oil & Gas Corporation, a Delaware corporation (f/k/a TPG Pace Energy Holdings Corp.) (the “ Company ”) and Continental Stock Transfer & Trust Company, a New York Corporation (the “ Warrant Agent ”), and constitutes an amendment to that certain Warrant Agreement, dated as of May 4, 2017 (the “ Existing Warrant Agreement ”), between the Company and the Warrant Agent. Capitalized terms used but not otherwise defined in this Amendment shall have the meanings given to such terms in the Existing Warrant Agreement.

WHEREAS, Section 9.8 of the Existing Warrant Agreement provides that the Company and the Warrant Agent may amend, subject to certain conditions provided therein, the Existing Warrant Agreement with the vote or written consent of the Registered Holders of 50% of the then outstanding Public Warrants;

WHEREAS, the Company desires to amend the Existing Warrant Agreement to provide the Company with the right to require the holders of the Public Warrants to exchange all of the outstanding Public Warrants for shares of Common Stock, on the terms and subject to the conditions set forth herein; and

WHEREAS, in the exchange offer and consent solicitation undertaken by the Company pursuant to the Registration Statement on Form S-4 filed with the U.S. Securities and Exchange Commission, the Registered Holders of 50% of the then outstanding Warrants (including, for the avoidance of doubt, the Registered Holders of 50% of the then outstanding Public Warrants) consented to and approved this Amendment.

NOW, THEREFORE, in consideration of the mutual agreements contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, the parties hereto agree to amend the Existing Warrant Agreement as set forth herein.

1. Amendment of Existing Warrant Agreement . The Existing Warrant Agreement is hereby amended by adding the new Section 6A thereto:

“6A Mandatory Exchange .

6A.1 Company Election to Exchange . Notwithstanding any other provision in this Agreement to the contrary, all (and not less than all) of the outstanding Warrants may be exchanged, at the option of the Company, at any time while they are exercisable and prior to their expiration, at the office of the Warrant Agent, upon notice to the Registered Holders of the outstanding Warrants, as described in Section  6A.2 below, for shares of Common Stock, at the exchange rate of 0.261 shares of Common Stock for each Warrant held by the holder thereof (the “ Consideration ”) (subject to equitable adjustment by the Company in the event of any stock splits, stock dividends, recapitalizations or similar transaction with respect to the Common Stock). In lieu of issuing fractional shares, any holder of Warrants who would otherwise have been entitled to receive fractional shares as Consideration will, after aggregating all such fractional shares of such holder, be paid in cash (without interest) in an amount equal to such fractional part of a share multiplied by 11.34.

 

6A.2 Date Fixed for, and Notice of, Exchange . In the event that the Company elects to exchange all of the Warrants, the Company shall fix a date for the exchange (the “ Exchange Date ”). Notice of exchange shall be mailed by first class mail, postage prepaid, by the Company not less than fifteen (15) days prior to the Exchange Date to the registered holders of the Warrants at their last addresses as they shall appear on the registration books. Any notice mailed in the manner herein provided shall be conclusively presumed to have been duly given whether or not the registered holder received such notice. The Company will make a public announcement of its election following the mailing of such notice.

6A.3 Exercise After Notice of Exchange . The Warrants may be exercised, for cash (or on a “cashless basis” in accordance with subsection 3.3.1(b) of this Agreement) at any time after notice of exchange shall have been given by the Company pursuant to Section  6A.2 hereof and prior to the Exchange Date. On and after the Exchange Date, the Registered Holder of the Warrants shall have no further rights except to receive, upon surrender of the Warrants, the Consideration.”

2. Miscellaneous Provisions .

2.1 Severability . This Amendment shall be deemed severable, and the invalidity or unenforceability of any term or provision hereof shall not affect the validity or enforceability of this Amendment or of any other term or provision hereof. Furthermore, in lieu of any such invalid or unenforceable term or provision, the parties hereto intend that there shall be added as a part of this Amendment a provision as similar in terms to such invalid or unenforceable provision as may be possible and be valid and enforceable.

2.2 Applicable Law . The validity, interpretation, and performance of this Amendment and of the Warrants shall be governed in all respects by the laws of the State of New York, without giving effect to conflicts of law principles that would result in the application of the substantive laws of another jurisdiction. The Company hereby agrees that any action, proceeding or claim against it arising out of or relating in any way to this Amendment shall be brought and enforced in the courts of the State of New York or the United States District Court for the Southern District of New York, and irrevocably submits to such jurisdiction, which jurisdiction shall be exclusive. The Company hereby waives any objection to such exclusive jurisdiction and that such courts represent an inconvenient forum.

2.3 Counterparts . This Amendment may be executed in any number of original or facsimile counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument.

2.4 Effect of Headings . The section headings herein are for convenience only and are not part of this Amendment and shall not affect the interpretation thereof.

2.5 Entire Agreement . The Existing Warrant Agreement, as modified by this Amendment, constitutes the entire understanding of the parties and supersedes all prior agreements, understandings, arrangements, promises and commitments, whether written or oral, express or implied, relating to the subject matter hereof, and all such prior agreements, understandings, arrangements, promises and commitments are hereby canceled and terminated.

[ Signature Pages Follow ]

 

2

IN WITNESS WHEREOF, each of the parties has caused this Amendment to be duly executed as of the date first above written.

 

MAGNOLIA OIL & GAS CORPORATION

By:  

/s/ Christopher G. Stavros

  Name:  

Christopher G. Stavros

  Title:  

Executive Vice President and Chief

Financial Officer

 

CONTINENTAL STOCK TRANSFER & TRUST

COMPANY, as Warrant Agent

By:  

/s/ Isaac J. Kagan

  Name:  

Isaac J. Kagan

  Title:   Vice President

 

[Signature Page to Warrant Amendment]

Exhibit 99.1

 

LOGO

Magnolia Oil & Gas Corporation Announces Completion of Exchange Offer and Plan to Exchange

Remaining Outstanding Warrants

HOUSTON, TX, July 10, 2019 –Magnolia Oil & Gas Corporation (the “Company”) (NYSE: MGY) announced today the completion and settlement of its previously announced exchange offer (the “Exchange Offer”) and consent solicitation (the “Consent Solicitation”) relating to its outstanding warrants. On July 10, 2019, the Company accepted all warrants validly tendered in the Exchange Offer and issued shares of its Class A common stock in exchange. As a result of the consents received in the Consent Solicitation, the Company also executed an amendment to the agreement governing its outstanding warrants (the “Warrant Agreement”). The Company also announced today that it will exchange all remaining untendered warrants on July 25, 2019 in accordance with the terms of the Warrant Agreement, as so amended.

This press release shall not constitute an offer to sell, or a solicitation of an offer to buy, the securities described herein and is also not a solicitation of the related consents. The exchange offer was made only pursuant to the terms and conditions of the Prospectus/Offer to Exchange and related letter of transmittal.

About the Company

The Company is a publicly traded oil and gas exploration and production company with operations primarily in South Texas in the core of the Eagle Ford. The Company focuses on generating value for shareholders through steady production growth, strong pre-tax margins, and free cash flow.

Forward-looking statements

The information in this press release includes forward-looking statements within the meaning of federal securities laws. All statements other than statements of present or historical fact included in this press release are forward-looking statements. When used in this press release, the words “could”, “should”, “will”, “may”, “believe”, “anticipate”, “intend”, “estimate”, “expect”, “project”, the negative of such terms and other 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 the Company’s current expectations and assumptions about future events and are based on currently available information as to the outcome and timing of future events. Except as otherwise required by applicable law, the Company 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. The Company cautions you that these forward-looking statements are subject to various risks and uncertainties, including those described under the section entitled “Risk Factors” in the Company’s Registration Statement on Form S-4/A, filed June 24, 2019, as such factors may be updated from time to time in the Company’s periodic filings with the SEC, which are available publicly on the SEC’s website at www.sec.gov .

Contact Information

Brian Corales

713-842-9036