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x
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
(State or other jurisdiction of incorporation or organization)
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81-5366183
(I.R.S. Employer
Identification No.)
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600 Travis
Houston, Texas
(Address of principal executive offices)
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77002
(Zip Code)
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(281) 840-4000
(Registrant’s telephone number, including area code)
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Large accelerated filer
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¨
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Accelerated filer
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¨
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Non-accelerated filer
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¨
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(Do not check if a smaller reporting company)
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Smaller reporting company
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x
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Emerging growth company
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¨
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Page
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Item 1.
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Financial Statements
|
|
Successor
|
|
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Predecessor
|
||||
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September 30,
2017 |
|
|
December 31,
2016 |
||||
(in thousands, except share and unit amounts)
|
|
|
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|
||||
ASSETS
|
|
|
|
|
||||
Current assets:
|
|
|
|
|
||||
Cash and cash equivalents
|
$
|
32,042
|
|
|
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$
|
694,857
|
|
Accounts receivable – trade, net
|
165,045
|
|
|
|
198,064
|
|
||
Derivative instruments
|
6,220
|
|
|
|
—
|
|
||
Restricted cash
|
51,322
|
|
|
|
1,602
|
|
||
Other current assets
|
85,937
|
|
|
|
105,310
|
|
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Current assets of discontinued operations
|
—
|
|
|
|
701
|
|
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Total current assets
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340,566
|
|
|
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1,000,534
|
|
||
|
|
|
|
|
||||
Noncurrent assets:
|
|
|
|
|
||||
Oil and natural gas properties (successful efforts method)
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1,248,246
|
|
|
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12,349,117
|
|
||
Less accumulated depletion and amortization
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(53,370
|
)
|
|
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(9,843,908
|
)
|
||
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1,194,876
|
|
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2,505,209
|
|
||
|
|
|
|
|
||||
Other property and equipment
|
472,332
|
|
|
|
618,262
|
|
||
Less accumulated depreciation
|
(22,067
|
)
|
|
|
(217,724
|
)
|
||
|
450,265
|
|
|
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400,538
|
|
||
|
|
|
|
|
||||
Derivative instruments
|
4,582
|
|
|
|
—
|
|
||
Deferred income taxes
|
476,419
|
|
|
|
—
|
|
||
Equity method investments
|
461,460
|
|
|
|
6,200
|
|
||
Other noncurrent assets
|
7,449
|
|
|
|
7,784
|
|
||
Noncurrent assets of discontinued operations
|
—
|
|
|
|
740,326
|
|
||
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949,910
|
|
|
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754,310
|
|
||
Total noncurrent assets
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2,595,051
|
|
|
|
3,660,057
|
|
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Total assets
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$
|
2,935,617
|
|
|
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$
|
4,660,591
|
|
|
|
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|
||||
LIABILITIES AND EQUITY (DEFICIT)
|
|
|
|
|
||||
Current liabilities:
|
|
|
|
|
||||
Accounts payable and accrued expenses
|
$
|
280,797
|
|
|
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$
|
295,081
|
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Derivative instruments
|
547
|
|
|
|
82,508
|
|
||
Current portion of long-term debt, net
|
—
|
|
|
|
1,937,729
|
|
||
Other accrued liabilities
|
100,755
|
|
|
|
25,979
|
|
||
Current liabilities of discontinued operations
|
—
|
|
|
|
321
|
|
||
Total current liabilities
|
382,099
|
|
|
|
2,341,618
|
|
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Successor
|
|
|
Predecessor
|
||||
|
September 30,
2017 |
|
|
December 31,
2016 |
||||
(in thousands, except share and unit amounts)
|
|
|
|
|
||||
Derivative instruments
|
229
|
|
|
|
11,349
|
|
||
Other noncurrent liabilities
|
260,133
|
|
|
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360,405
|
|
||
Noncurrent liabilities of discontinued operations
|
—
|
|
|
|
39,202
|
|
||
Liabilities subject to compromise
|
—
|
|
|
|
4,305,005
|
|
||
|
|
|
|
|
||||
Commitments and contingencies (Note 11)
|
|
|
|
|
|
|
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Equity (deficit):
|
|
|
|
|
||||
Predecessor units issued and outstanding (no units issued or outstanding at September 30, 2017; 352,792,474 units issued and outstanding at December 31, 2016)
|
—
|
|
|
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5,386,885
|
|
||
Predecessor accumulated deficit
|
—
|
|
|
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(7,783,873
|
)
|
||
Successor preferred stock ($0.001 par value, 30,000,000 shares authorized and no shares issued at September 30, 2017; no shares authorized or issued at December 31, 2016)
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—
|
|
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—
|
|
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Successor Class A common stock ($0.001 par value, 270,000,000 shares authorized and 84,667,268 shares issued at September 30, 2017; no shares authorized or issued at December 31, 2016)
|
85
|
|
|
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—
|
|
||
Successor additional paid-in capital
|
1,926,722
|
|
|
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—
|
|
||
Successor retained earnings
|
349,864
|
|
|
|
—
|
|
||
Total common stockholders’/unitholders’ equity (deficit)
|
2,276,671
|
|
|
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(2,396,988
|
)
|
||
Noncontrolling interests
|
16,485
|
|
|
|
—
|
|
||
Total equity (deficit)
|
2,293,156
|
|
|
|
(2,396,988
|
)
|
||
Total liabilities and equity (deficit)
|
$
|
2,935,617
|
|
|
|
$
|
4,660,591
|
|
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Successor
|
|
|
Predecessor
|
||||
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Three Months Ended September 30, 2017
|
|
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Three Months Ended September 30, 2016
|
||||
(in thousands, except per share and per unit amounts)
|
|
|
|
|
||||
Revenues and other:
|
|
|
|
|
||||
Oil, natural gas and natural gas liquids sales
|
$
|
206,318
|
|
|
|
$
|
237,986
|
|
Gains (losses) on oil and natural gas derivatives
|
(14,497
|
)
|
|
|
166
|
|
||
Marketing revenues
|
38,493
|
|
|
|
9,249
|
|
||
Other revenues
|
6,368
|
|
|
|
19,574
|
|
||
|
236,682
|
|
|
|
266,975
|
|
||
Expenses:
|
|
|
|
|
||||
Lease operating expenses
|
61,272
|
|
|
|
67,234
|
|
||
Transportation expenses
|
34,541
|
|
|
|
40,986
|
|
||
Marketing expenses
|
34,099
|
|
|
|
6,933
|
|
||
General and administrative expenses
|
30,035
|
|
|
|
48,471
|
|
||
Exploration costs
|
171
|
|
|
|
4
|
|
||
Depreciation, depletion and amortization
|
29,657
|
|
|
|
87,413
|
|
||
Impairment of long-lived assets
|
—
|
|
|
|
41,728
|
|
||
Taxes, other than income taxes
|
12,368
|
|
|
|
18,003
|
|
||
(Gains) losses on sale of assets and other, net
|
(26,977
|
)
|
|
|
2,532
|
|
||
|
175,166
|
|
|
|
313,304
|
|
||
Other income and (expenses):
|
|
|
|
|
||||
Interest expense, net of amounts capitalized
|
(223
|
)
|
|
|
(25,283
|
)
|
||
Earnings from equity method investments
|
2,575
|
|
|
|
222
|
|
||
Other, net
|
(4,237
|
)
|
|
|
(200
|
)
|
||
|
(1,885
|
)
|
|
|
(25,261
|
)
|
||
Reorganization items, net
|
(2,605
|
)
|
|
|
(28,361
|
)
|
||
Income (loss) from continuing operations before income taxes
|
57,026
|
|
|
|
(99,951
|
)
|
||
Income tax expense (benefit)
|
5,996
|
|
|
|
(3,650
|
)
|
||
Income (loss) from continuing operations
|
51,030
|
|
|
|
(96,301
|
)
|
||
Income (loss) from discontinued operations, net of income taxes
|
86,099
|
|
|
|
(102,064
|
)
|
||
Net income (loss)
|
137,129
|
|
|
|
(198,365
|
)
|
||
Net income attributable to noncontrolling interests
|
66
|
|
|
|
—
|
|
||
Net income (loss) attributable to common stockholders/unitholders
|
$
|
137,063
|
|
|
|
$
|
(198,365
|
)
|
|
|
|
|
|
||||
Income (loss) per share/unit attributable to common stockholders/unitholders:
|
|
|
|
|
||||
Income (loss) from continuing operations per share/unit – Basic
|
$
|
0.58
|
|
|
|
$
|
(0.27
|
)
|
Income (loss) from continuing operations per share/unit – Diluted
|
$
|
0.57
|
|
|
|
$
|
(0.27
|
)
|
|
|
|
|
|
||||
Income (loss) from discontinued operations per share/unit – Basic
|
$
|
0.98
|
|
|
|
$
|
(0.29
|
)
|
Income (loss) from discontinued operations per share/unit – Diluted
|
$
|
0.97
|
|
|
|
$
|
(0.29
|
)
|
|
|
|
|
|
||||
Net income (loss) per share/unit – Basic
|
$
|
1.56
|
|
|
|
$
|
(0.56
|
)
|
Net income (loss) per share/unit – Diluted
|
$
|
1.54
|
|
|
|
$
|
(0.56
|
)
|
|
|
|
|
|
||||
Weighted average shares/units outstanding – Basic
|
87,796
|
|
|
|
352,792
|
|
||
Weighted average shares/units outstanding – Diluted
|
88,999
|
|
|
|
352,792
|
|
|
Successor
|
|
|
Predecessor
|
||||||||
|
Seven Months Ended September 30, 2017
|
|
|
Two Months Ended February 28, 2017
|
|
Nine Months Ended September 30, 2016
|
||||||
(in thousands, except per share and per unit amounts)
|
|
|
|
|
|
|
||||||
Revenues and other:
|
|
|
|
|
|
|
||||||
Oil, natural gas and natural gas liquids sales
|
$
|
529,810
|
|
|
|
$
|
188,885
|
|
|
$
|
618,274
|
|
Gains (losses) on oil and natural gas derivatives
|
19,258
|
|
|
|
92,691
|
|
|
(74,175
|
)
|
|||
Marketing revenues
|
53,954
|
|
|
|
6,636
|
|
|
26,861
|
|
|||
Other revenues
|
14,787
|
|
|
|
9,915
|
|
|
71,521
|
|
|||
|
617,809
|
|
|
|
298,127
|
|
|
642,481
|
|
|||
Expenses:
|
|
|
|
|
|
|
||||||
Lease operating expenses
|
156,959
|
|
|
|
49,665
|
|
|
220,847
|
|
|||
Transportation expenses
|
85,652
|
|
|
|
25,972
|
|
|
124,609
|
|
|||
Marketing expenses
|
43,614
|
|
|
|
4,820
|
|
|
21,493
|
|
|||
General and administrative expenses
|
74,904
|
|
|
|
71,745
|
|
|
184,360
|
|
|||
Exploration costs
|
1,037
|
|
|
|
93
|
|
|
2,745
|
|
|||
Depreciation, depletion and amortization
|
101,558
|
|
|
|
47,155
|
|
|
262,880
|
|
|||
Impairment of long-lived assets
|
—
|
|
|
|
—
|
|
|
165,044
|
|
|||
Taxes, other than income taxes
|
37,316
|
|
|
|
14,877
|
|
|
53,544
|
|
|||
(Gains) losses on sale of assets and other, net
|
(333,371
|
)
|
|
|
829
|
|
|
6,607
|
|
|||
|
167,669
|
|
|
|
215,156
|
|
|
1,042,129
|
|
|||
Other income and (expenses):
|
|
|
|
|
|
|
||||||
Interest expense, net of amounts capitalized
|
(11,974
|
)
|
|
|
(16,725
|
)
|
|
(159,476
|
)
|
|||
Earnings from equity method investments
|
2,705
|
|
|
|
157
|
|
|
511
|
|
|||
Other, net
|
(5,788
|
)
|
|
|
(149
|
)
|
|
(1,358
|
)
|
|||
|
(15,057
|
)
|
|
|
(16,717
|
)
|
|
(160,323
|
)
|
|||
Reorganization items, net
|
(8,547
|
)
|
|
|
2,331,189
|
|
|
457,437
|
|
|||
Income (loss) from continuing operations before income taxes
|
426,536
|
|
|
|
2,397,443
|
|
|
(102,534
|
)
|
|||
Income tax expense (benefit)
|
159,451
|
|
|
|
(166
|
)
|
|
2,944
|
|
|||
Income (loss) from continuing operations
|
267,085
|
|
|
|
2,397,609
|
|
|
(105,478
|
)
|
|||
Income (loss) from discontinued operations, net of income taxes
|
82,845
|
|
|
|
(548
|
)
|
|
(1,232,141
|
)
|
|||
Net income (loss)
|
349,930
|
|
|
|
2,397,061
|
|
|
(1,337,619
|
)
|
|||
Net income attributable to noncontrolling interests
|
66
|
|
|
|
—
|
|
|
—
|
|
|||
Net income (loss) attributable to common stockholders/unitholders
|
$
|
349,864
|
|
|
|
$
|
2,397,061
|
|
|
$
|
(1,337,619
|
)
|
|
|
|
|
|
|
|
||||||
Income (loss) per share/unit attributable to common stockholders/unitholders:
|
|
|
|
|
|
|
||||||
Income (loss) from continuing operations per share/unit – Basic
|
$
|
3.00
|
|
|
|
$
|
6.80
|
|
|
$
|
(0.30
|
)
|
Income (loss) from continuing operations per share/unit – Diluted
|
$
|
2.97
|
|
|
|
$
|
6.80
|
|
|
$
|
(0.30
|
)
|
|
|
|
|
|
|
|
||||||
Income (loss) from discontinued operations per share/unit – Basic
|
$
|
0.93
|
|
|
|
$
|
(0.01
|
)
|
|
$
|
(3.49
|
)
|
Income (loss) from discontinued operations per share/unit – Diluted
|
$
|
0.93
|
|
|
|
$
|
(0.01
|
)
|
|
$
|
(3.49
|
)
|
|
|
|
|
|
|
|
||||||
Net income (loss) per share/unit – Basic
|
$
|
3.93
|
|
|
|
$
|
6.79
|
|
|
$
|
(3.79
|
)
|
Net income (loss) per share/unit – Diluted
|
$
|
3.90
|
|
|
|
$
|
6.79
|
|
|
$
|
(3.79
|
)
|
|
|
|
|
|
|
|
||||||
Weighted average shares/units outstanding – Basic
|
88,966
|
|
|
|
352,792
|
|
|
352,606
|
|
|||
Weighted average shares/units outstanding – Diluted
|
89,784
|
|
|
|
352,792
|
|
|
352,606
|
|
|
Units
|
|
Unitholders’ Capital
|
|
Accumulated Deficit
|
|
Total Unitholders’ Capital (Deficit)
|
|||||||
|
(in thousands)
|
|||||||||||||
|
|
|
|
|
|
|
|
|||||||
December 31, 2016
(Predecessor)
|
352,792
|
|
|
$
|
5,386,885
|
|
|
$
|
(7,783,873
|
)
|
|
$
|
(2,396,988
|
)
|
Net income
|
|
|
—
|
|
|
2,397,061
|
|
|
2,397,061
|
|
||||
Other
|
|
|
(73
|
)
|
|
—
|
|
|
(73
|
)
|
||||
February 28, 2017
(Predecessor)
|
352,792
|
|
|
5,386,812
|
|
|
(5,386,812
|
)
|
|
—
|
|
|||
Cancellation of predecessor equity
|
(352,792
|
)
|
|
(5,386,812
|
)
|
|
5,386,812
|
|
|
—
|
|
|||
February 28, 2017
(Predecessor)
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Class A Common Stock
|
|
Additional Paid-in Capital
|
|
Retained Earnings
|
|
Total Common Stockholders’ Equity
|
|
Noncontrolling Interests
|
|
Total Equity
|
|||||||||||||||
|
Shares
|
|
Amount
|
|
|
|
|
|||||||||||||||||||
|
(in thousands)
|
|||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Issuances of successor Class A common stock
|
89,230
|
|
|
$
|
89
|
|
|
$
|
2,021,142
|
|
|
$
|
—
|
|
|
$
|
2,021,231
|
|
|
$
|
—
|
|
|
$
|
2,021,231
|
|
Share-based compensation expenses
|
|
|
—
|
|
|
13,750
|
|
|
—
|
|
|
13,750
|
|
|
—
|
|
|
13,750
|
|
|||||||
February 28, 2017
(Successor)
|
89,230
|
|
|
89
|
|
|
2,034,892
|
|
|
—
|
|
|
2,034,981
|
|
|
—
|
|
|
2,034,981
|
|
||||||
Net income
|
|
|
—
|
|
|
—
|
|
|
349,864
|
|
|
349,864
|
|
|
66
|
|
|
349,930
|
|
|||||||
Issuances of successor Class A common stock
|
21
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Repurchases of successor Class A common stock
|
(4,584
|
)
|
|
(4
|
)
|
|
(156,947
|
)
|
|
—
|
|
|
(156,951
|
)
|
|
—
|
|
|
(156,951
|
)
|
||||||
Share-based compensation expenses
|
|
|
—
|
|
|
62,381
|
|
|
—
|
|
|
62,381
|
|
|
—
|
|
|
62,381
|
|
|||||||
Initial allocation of noncontrolling interests upon conversion of subsidiary units
|
|
|
—
|
|
|
(17,605
|
)
|
|
—
|
|
|
(17,605
|
)
|
|
17,605
|
|
|
—
|
|
|||||||
Distributions to noncontrolling interests
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,211
|
)
|
|
(1,211
|
)
|
|||||||
Subsidiary equity transactions
|
|
|
—
|
|
|
(25
|
)
|
|
—
|
|
|
(25
|
)
|
|
25
|
|
|
—
|
|
|||||||
Other
|
|
|
—
|
|
|
4,026
|
|
|
—
|
|
|
4,026
|
|
|
—
|
|
|
4,026
|
|
|||||||
September 30, 2017
(Successor)
|
84,667
|
|
|
$
|
85
|
|
|
$
|
1,926,722
|
|
|
$
|
349,864
|
|
|
$
|
2,276,671
|
|
|
$
|
16,485
|
|
|
$
|
2,293,156
|
|
|
Successor
|
|
|
Predecessor
|
||||||||
|
Seven Months Ended September 30, 2017
|
|
|
Two Months Ended February 28, 2017
|
|
Nine Months Ended September 30, 2016
|
||||||
(in thousands)
|
|
|
|
|
|
|
||||||
Cash flow from operating activities:
|
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
349,930
|
|
|
|
$
|
2,397,061
|
|
|
$
|
(1,337,619
|
)
|
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
|
|
|
|
|
|
|
||||||
(Income) loss from discontinued operations
|
(82,845
|
)
|
|
|
548
|
|
|
1,232,141
|
|
|||
Depreciation, depletion and amortization
|
101,558
|
|
|
|
47,155
|
|
|
262,880
|
|
|||
Impairment of long-lived assets
|
—
|
|
|
|
—
|
|
|
165,044
|
|
|||
Deferred income taxes
|
116,446
|
|
|
|
(166
|
)
|
|
831
|
|
|||
Noncash (gains) losses on oil and natural gas derivatives
|
380
|
|
|
|
(104,263
|
)
|
|
931,085
|
|
|||
Share-based compensation expenses
|
25,876
|
|
|
|
50,255
|
|
|
24,514
|
|
|||
Amortization and write-off of deferred financing fees
|
3,349
|
|
|
|
1,338
|
|
|
11,288
|
|
|||
(Gains) losses on sale of assets and other, net
|
(357,510
|
)
|
|
|
1,069
|
|
|
5,534
|
|
|||
Reorganization items, net
|
—
|
|
|
|
(2,359,364
|
)
|
|
(485,831
|
)
|
|||
Changes in assets and liabilities:
|
|
|
|
|
|
|
||||||
(Increase) decrease in accounts receivable – trade, net
|
15,549
|
|
|
|
(7,216
|
)
|
|
(27,857
|
)
|
|||
(Increase) decrease in other assets
|
3,908
|
|
|
|
402
|
|
|
(17,111
|
)
|
|||
(Increase) decrease in restricted cash
|
2,151
|
|
|
|
(80,164
|
)
|
|
—
|
|
|||
Increase (decrease) in accounts payable and accrued expenses
|
(43,213
|
)
|
|
|
20,949
|
|
|
64,252
|
|
|||
Increase in other liabilities
|
56,460
|
|
|
|
2,801
|
|
|
21,679
|
|
|||
Net cash provided by (used in) operating activities – continuing operations
|
192,039
|
|
|
|
(29,595
|
)
|
|
850,830
|
|
|||
Net cash provided by operating activities – discontinued operations
|
2,566
|
|
|
|
8,781
|
|
|
34,362
|
|
|||
Net cash provided by (used in) operating activities
|
194,605
|
|
|
|
(20,814
|
)
|
|
885,192
|
|
|||
|
|
|
|
|
|
|
||||||
Cash flow from investing activities:
|
|
|
|
|
|
|
||||||
Development of oil and natural gas properties
|
(136,638
|
)
|
|
|
(50,597
|
)
|
|
(118,920
|
)
|
|||
Purchases of other property and equipment
|
(60,656
|
)
|
|
|
(7,409
|
)
|
|
(25,955
|
)
|
|||
Proceeds from sale of properties and equipment and other
|
703,234
|
|
|
|
(166
|
)
|
|
(3,321
|
)
|
|||
Net cash provided by (used in) investing activities – continuing operations
|
505,940
|
|
|
|
(58,172
|
)
|
|
(148,196
|
)
|
|||
Net cash provided by (used in) investing activities – discontinued operations
|
345,643
|
|
|
|
(584
|
)
|
|
19,133
|
|
|||
Net cash provided by (used in) investing activities
|
851,583
|
|
|
|
(58,756
|
)
|
|
(129,063
|
)
|
|||
|
|
|
|
|
|
|
|
Successor
|
|
|
Predecessor
|
||||||||
|
Seven Months Ended September 30, 2017
|
|
|
Two Months Ended February 28, 2017
|
|
Nine Months Ended September 30, 2016
|
||||||
(in thousands)
|
|
|
|
|
|
|
||||||
Cash flow from financing activities:
|
|
|
|
|
|
|
||||||
Proceeds from rights offerings, net
|
—
|
|
|
|
514,069
|
|
|
—
|
|
|||
Repurchases of shares
|
(156,091
|
)
|
|
|
—
|
|
|
—
|
|
|||
Proceeds from borrowings
|
190,000
|
|
|
|
—
|
|
|
978,500
|
|
|||
Repayments of debt
|
(1,090,000
|
)
|
|
|
(1,038,986
|
)
|
|
(913,210
|
)
|
|||
Debt issuance costs paid
|
(7,229
|
)
|
|
|
—
|
|
|
(692
|
)
|
|||
Payment to holders of claims under the second lien notes
|
—
|
|
|
|
(30,000
|
)
|
|
—
|
|
|||
Other
|
(5,181
|
)
|
|
|
(6,015
|
)
|
|
(20,687
|
)
|
|||
Net cash provided by (used in) financing activities – continuing operations
|
(1,068,501
|
)
|
|
|
(560,932
|
)
|
|
43,911
|
|
|||
Net cash used in financing activities – discontinued operations
|
—
|
|
|
|
—
|
|
|
(1,701
|
)
|
|||
Net cash provided by (used in) financing activities
|
(1,068,501
|
)
|
|
|
(560,932
|
)
|
|
42,210
|
|
|||
|
|
|
|
|
|
|
||||||
Net increase (decrease) in cash and cash equivalents
|
(22,313
|
)
|
|
|
(640,502
|
)
|
|
798,339
|
|
|||
Cash and cash equivalents:
|
|
|
|
|
|
|
||||||
Beginning
|
54,355
|
|
|
|
694,857
|
|
|
2,168
|
|
|||
Ending
|
32,042
|
|
|
|
54,355
|
|
|
800,507
|
|
|||
Less cash and cash equivalents of discontinued operations at end of period
|
—
|
|
|
|
—
|
|
|
(29,647
|
)
|
|||
Ending – continuing operations
|
$
|
32,042
|
|
|
|
$
|
54,355
|
|
|
$
|
770,860
|
|
•
|
The Predecessor transferred all of its assets, including equity interests in its subsidiaries, other than LAC and Berry, to Linn Energy Holdco II LLC (“Holdco II”), a newly formed subsidiary of the Predecessor and the borrower under the Credit Agreement (as amended, the “Successor Credit Facility”) entered into in connection with the reorganization, in exchange for
100%
of the equity of Holdco II and the issuance of interests in the Successor Credit Facility to certain of the Predecessor’s creditors in partial satisfaction of their claims (the “Contribution”). Immediately following the Contribution, the Predecessor transferred
100%
of the equity interests in Holdco II to the Successor in exchange for approximately
$530 million
in cash and an amount of equity securities in the Successor not to exceed
49.90%
of the outstanding equity interests of the Successor, which the Predecessor distributed to certain of its creditors in satisfaction of their claims. Contemporaneously with the reorganization transactions and pursuant to the Plan, (i) LAC assigned all of its rights, title and interest in the membership interests of Berry to Berry Petroleum Corporation, (ii) all of the equity interests in LAC and the Predecessor were canceled and (iii) LAC and the Predecessor commenced liquidation, which is expected to be completed following the resolution of the respective companies’ outstanding claims.
|
•
|
The holders of claims under the Predecessor’s Sixth Amended and Restated Credit Agreement (“Predecessor Credit Facility”) received a full recovery, consisting of a cash paydown and their pro rata share of the
$1.7 billion
Successor Credit Facility. As a result, all outstanding obligations under the Predecessor Credit Facility were canceled.
|
•
|
Holdco II, as borrower, entered into the Successor Credit Facility with the holders of claims under the Predecessor Credit Facility, as lenders, and Wells Fargo Bank, National Association, as administrative agent, providing for a new reserve-based revolving loan with up to
$1.4 billion
in borrowing commitments and a new term loan in an original principal amount of
$300 million
. For additional information about the Successor Credit Facility, see Note 7.
|
•
|
The holders of the Company’s
12.00%
senior secured second lien notes due December 2020 (the “Second Lien Notes”) received their pro rata share of (i)
17,678,889
shares of Class A common stock; (ii) certain rights to purchase shares of Class A common stock in the rights offerings, as described below; and (iii)
$30 million
in cash. The holders of the Company’s
6.50%
senior notes due May 2019,
6.25%
senior notes due November 2019,
8.625%
senior notes due 2020,
7.75%
senior notes due February 2021 and
6.50%
senior notes due September 2021 (collectively, the “Unsecured Notes”) received their pro rata share of (i)
26,724,396
shares of Class A common stock; and (ii) certain rights to purchase shares of Class A common stock in the rights offerings, as described below. As a result, all outstanding obligations under the Second Lien Notes and the Unsecured Notes and the indentures governing such obligations were canceled.
|
•
|
The holders of general unsecured claims (other than claims relating to the Second Lien Notes and the Unsecured Notes) against the LINN Debtors (the “LINN Unsecured Claims”) received their pro rata share of cash from two cash distribution pools totaling
$40 million
, as divided between a
$2.3 million
cash distribution pool for the payment in full of allowed LINN Unsecured Claims in an amount equal to
$2,500
or less (and larger claims for which the holders irrevocably agreed to reduce such claims to
$2,500
), and a
$37.7 million
cash distribution pool for pro rata distributions to all remaining allowed general LINN Unsecured Claims. As a result, all outstanding LINN Unsecured Claims were fully satisfied, settled, released and discharged as of the Effective Date.
|
•
|
All units of the Predecessor that were issued and outstanding immediately prior to the Effective Date were extinguished without recovery. On the Effective Date, the Successor issued in the aggregate
89,229,892
shares of Class A common stock. No cash was raised from the issuance of the Class A common stock on account of claims held by the Predecessor’s creditors.
|
•
|
The Successor entered into a registration rights agreement with certain parties, pursuant to which the Company agreed to, among other things, file a registration statement with the SEC within 60 days of the Effective Date covering the offer and resale of “Registrable Securities” (as defined therein).
|
•
|
By operation of the Plan and the Confirmation Order, the terms of the Predecessor’s board of directors expired as of the Effective Date. The Successor formed a new board of directors, consisting of the Chief Executive Officer of the Predecessor, one director selected by the Successor and five directors selected by a six-person selection committee.
|
|
Predecessor
|
||
|
December 31, 2016
|
||
|
(in thousands)
|
||
|
|
||
Accounts payable and accrued expenses
|
$
|
137,692
|
|
Accrued interest payable
|
144,184
|
|
|
Debt
|
4,023,129
|
|
|
Liabilities subject to compromise
|
$
|
4,305,005
|
|
|
Successor
|
|
|
Predecessor
|
||||
|
Three Months Ended September 30, 2017
|
|
|
Three Months Ended September 30, 2016
|
||||
(in thousands)
|
|
|
|
|
||||
Legal and other professional advisory fees
|
$
|
(2,549
|
)
|
|
|
$
|
(16,714
|
)
|
Terminated contracts
|
—
|
|
|
|
(13,123
|
)
|
||
Other
|
(56
|
)
|
|
|
1,476
|
|
||
Reorganization items, net
|
$
|
(2,605
|
)
|
|
|
$
|
(28,361
|
)
|
|
Successor
|
|
|
Predecessor
|
||||||||
|
Seven Months Ended September 30, 2017
|
|
|
Two Months Ended February 28, 2017
|
|
Nine Months Ended September 30, 2016
|
||||||
(in thousands)
|
|
|
|
|
|
|
||||||
Gain on settlement of liabilities subject to compromise
|
$
|
—
|
|
|
|
$
|
3,724,750
|
|
|
$
|
—
|
|
Recognition of an additional claim for the Predecessor’s Second Lien Notes settlement
|
—
|
|
|
|
(1,000,000
|
)
|
|
—
|
|
|||
Fresh start valuation adjustments
|
—
|
|
|
|
(591,525
|
)
|
|
—
|
|
|||
Income tax benefit related to implementation of the Plan
|
—
|
|
|
|
264,889
|
|
|
—
|
|
|||
Legal and other professional advisory fees
|
(8,565
|
)
|
|
|
(46,961
|
)
|
|
(30,165
|
)
|
|||
Unamortized deferred financing fees, discounts and premiums
|
—
|
|
|
|
—
|
|
|
(52,045
|
)
|
|||
Gain related to interest payable on Predecessor’s Second Lien Notes
|
—
|
|
|
|
—
|
|
|
551,000
|
|
|||
Terminated contracts
|
—
|
|
|
|
(6,915
|
)
|
|
(13,123
|
)
|
|||
Other
|
18
|
|
|
|
(13,049
|
)
|
|
1,770
|
|
|||
Reorganization items, net
|
$
|
(8,547
|
)
|
|
|
$
|
2,331,189
|
|
|
$
|
457,437
|
|
Plan confirmed enterprise value
|
$
|
2,350,000
|
|
Fair value of debt
|
(900,000
|
)
|
|
Fair value of subsequently determined tax attributes
|
621,486
|
|
|
Fair value of vested Class B units
|
(36,505
|
)
|
|
Value of Successor’s stockholders’ equity
|
$
|
2,034,981
|
|
|
As of February 28, 2017
|
||||||||||||||||
|
Predecessor
|
|
Reorganization Adjustments
(1)
|
|
|
Fresh Start Adjustments
|
|
|
Successor
|
||||||||
|
(in thousands)
|
||||||||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
||||||||
Current assets:
|
|
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
|
$
|
734,166
|
|
|
$
|
(679,811
|
)
|
(2)
|
|
$
|
—
|
|
|
|
$
|
54,355
|
|
Accounts receivable – trade, net
|
212,099
|
|
|
—
|
|
|
|
(7,808
|
)
|
(16)
|
|
204,291
|
|
||||
Derivative instruments
|
15,391
|
|
|
—
|
|
|
|
—
|
|
|
|
15,391
|
|
||||
Restricted cash
|
1,602
|
|
|
80,164
|
|
(3)
|
|
—
|
|
|
|
81,766
|
|
||||
Other current assets
|
106,426
|
|
|
(15,983
|
)
|
(4)
|
|
1,780
|
|
(17)
|
|
92,223
|
|
||||
Total current assets
|
1,069,684
|
|
|
(615,630
|
)
|
|
|
(6,028
|
)
|
|
|
448,026
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||||||
Noncurrent assets:
|
|
|
|
|
|
|
|
|
|
||||||||
Oil and natural gas properties (successful efforts method)
|
13,269,035
|
|
|
—
|
|
|
|
(11,082,258
|
)
|
(18)
|
|
2,186,777
|
|
||||
Less accumulated depletion and amortization
|
(10,044,240
|
)
|
|
—
|
|
|
|
10,044,240
|
|
(18)
|
|
—
|
|
||||
|
3,224,795
|
|
|
—
|
|
|
|
(1,038,018
|
)
|
|
|
2,186,777
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||||||
Other property and equipment
|
641,586
|
|
|
—
|
|
|
|
(197,653
|
)
|
(19)
|
|
443,933
|
|
||||
Less accumulated depreciation
|
(230,952
|
)
|
|
—
|
|
|
|
230,952
|
|
(19)
|
|
—
|
|
||||
|
410,634
|
|
|
—
|
|
|
|
33,299
|
|
|
|
443,933
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||||||
Derivative instruments
|
4,492
|
|
|
—
|
|
|
|
—
|
|
|
|
4,492
|
|
||||
Deferred income taxes
|
—
|
|
|
264,889
|
|
(5)
|
|
356,597
|
|
(5)
|
|
621,486
|
|
||||
Other noncurrent assets
|
15,003
|
|
|
151
|
|
(6)
|
|
8,139
|
|
(20)
|
|
23,293
|
|
||||
|
19,495
|
|
|
265,040
|
|
|
|
364,736
|
|
|
|
649,271
|
|
||||
Total noncurrent assets
|
3,654,924
|
|
|
265,040
|
|
|
|
(639,983
|
)
|
|
|
3,279,981
|
|
||||
Total assets
|
$
|
4,724,608
|
|
|
$
|
(350,590
|
)
|
|
|
$
|
(646,011
|
)
|
|
|
$
|
3,728,007
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
LIABILITIES AND EQUITY (DEFICIT)
|
|
|
|
|
|
|
|
|
|||||||||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||
Accounts payable and accrued expenses
|
$
|
324,585
|
|
|
$
|
41,266
|
|
(7)
|
|
$
|
(2,351
|
)
|
(21)
|
|
$
|
363,500
|
|
Derivative instruments
|
7,361
|
|
|
—
|
|
|
|
—
|
|
|
|
7,361
|
|
||||
Current portion of long-term debt, net
|
1,937,822
|
|
|
(1,912,822
|
)
|
(8)
|
|
—
|
|
|
|
25,000
|
|
||||
Other accrued liabilities
|
41,251
|
|
|
(1,026
|
)
|
(9)
|
|
1,104
|
|
(22)
|
|
41,329
|
|
||||
Total current liabilities
|
2,311,019
|
|
|
(1,872,582
|
)
|
|
|
(1,247
|
)
|
|
|
437,190
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||||||
Derivative instruments
|
2,116
|
|
|
—
|
|
|
|
—
|
|
|
|
2,116
|
|
||||
Long-term debt
|
—
|
|
|
875,000
|
|
(10)
|
|
—
|
|
|
|
875,000
|
|
||||
Other noncurrent liabilities
|
402,776
|
|
|
(167
|
)
|
(11)
|
|
(53,239
|
)
|
(23)
|
|
349,370
|
|
||||
Liabilities subject to compromise
|
4,301,912
|
|
|
(4,301,912
|
)
|
(12)
|
|
—
|
|
|
|
—
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||||||
Temporary equity:
|
|
|
|
|
|
|
|
|
|
||||||||
Redeemable noncontrolling interests
|
—
|
|
|
29,350
|
|
(13)
|
|
—
|
|
|
|
29,350
|
|
|
As of February 28, 2017
|
||||||||||||||||
|
Predecessor
|
|
Reorganization Adjustments
(1)
|
|
|
Fresh Start Adjustments
|
|
|
Successor
|
||||||||
Stockholders’/unitholders’ equity (deficit):
|
|
|
|
|
|
|
|
|
|
||||||||
Predecessor units issued and outstanding
|
5,386,812
|
|
|
(5,386,812
|
)
|
(14)
|
|
—
|
|
|
|
—
|
|
||||
Predecessor accumulated deficit
|
(7,680,027
|
)
|
|
2,884,740
|
|
(15)
|
|
4,795,287
|
|
(24)
|
|
—
|
|
||||
Successor Class A common stock
|
—
|
|
|
89
|
|
(14)
|
|
—
|
|
|
|
89
|
|
||||
Successor additional paid-in capital
|
—
|
|
|
7,421,704
|
|
(14)
|
|
(5,386,812
|
)
|
(24)
|
|
2,034,892
|
|
||||
Successor retained earnings
|
—
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
||||
Total stockholders’/unitholders’ equity (deficit)
|
(2,293,215
|
)
|
|
4,919,721
|
|
|
|
(591,525
|
)
|
|
|
2,034,981
|
|
||||
Total liabilities and equity (deficit)
|
$
|
4,724,608
|
|
|
$
|
(350,590
|
)
|
|
|
$
|
(646,011
|
)
|
|
|
$
|
3,728,007
|
|
1)
|
Represent amounts recorded as of the Effective Date for the implementation of the Plan, including, among other items, settlement of the Predecessor’s liabilities subject to compromise, repayment of certain of the Predecessor’s debt, cancellation of the Predecessor’s equity, issuances of the Successor’s Class A common stock, proceeds received from the Successor’s rights offerings and issuance of the Successor’s debt.
|
2)
|
Changes in cash and cash equivalents included the following:
|
(in thousands)
|
|
||
Borrowings under the Successor’s revolving loan
|
$
|
600,000
|
|
Borrowings under the Successor’s term loan
|
300,000
|
|
|
Proceeds from rights offerings
|
530,019
|
|
|
Removal of restriction on cash balance
|
1,602
|
|
|
Payment to holders of claims under the Predecessor Credit Facility
|
(1,947,357
|
)
|
|
Payment to holders of claims under the Second Lien Notes
|
(30,000
|
)
|
|
Payment of Berry’s ad valorem taxes
|
(23,366
|
)
|
|
Payment of the rights offerings backstop commitment premium
|
(15,900
|
)
|
|
Payment of professional fees
|
(13,043
|
)
|
|
Funding of the professional fees escrow account
|
(41,766
|
)
|
|
Funding of the general unsecured claims cash distribution pool
|
(40,000
|
)
|
|
Changes in cash and cash equivalents
|
$
|
(679,811
|
)
|
3)
|
Primarily reflects the transfer to restricted cash to fund the Predecessor’s professional fees escrow account and general unsecured claims cash distribution pool.
|
4)
|
Primarily reflects the write-off of the Predecessor’s deferred financing fees.
|
5)
|
Reflects deferred tax assets recorded as of the Effective Date as determined in accordance with ASC 740. The deferred tax assets were primarily the result of the conversion from a limited liability company to a C corporation and differences in the accounting basis and tax basis of the Company’s oil and natural gas properties as of the Effective Date.
|
6)
|
Reflects the capitalization of deferred financing fees related to the Successor’s revolving loan.
|
7)
|
Net increase in accounts payable and accrued expenses reflects:
|
(in thousands)
|
|
||
Recognition of payables for the professional fees escrow account
|
$
|
41,766
|
|
Recognition of payables for the general unsecured claims cash distribution pool
|
40,000
|
|
|
Payment of professional fees
|
(17,130
|
)
|
|
Payment of Berry’s ad valorem taxes
|
(23,366
|
)
|
|
Other
|
(4
|
)
|
|
Net increase in accounts payable and accrued expenses
|
$
|
41,266
|
|
8)
|
Reflects the settlement of the Predecessor Credit Facility through repayment of approximately
$1.9 billion
, net of the write-off of deferred financing fees and an increase of
$25 million
for the current portion of the Successor’s term loan.
|
9)
|
Reflects a decrease of approximately
$8 million
for the payment of accrued interest on the Predecessor Credit Facility partially offset by an increase of approximately
$7 million
related to noncash share-based compensation classified as a liability related to the incentive interest awards issued by Holdco to certain members of its management (see Note 14).
|
10)
|
Reflects borrowings of
$900 million
under the Successor Credit Facility, which includes a
$600 million
revolving loan and a
$300 million
term loan, net of
$25 million
for the current portion of the Successor’s term loan.
|
11)
|
Reflects a reduction in deferred tax liabilities as determined in accordance with ASC 740.
|
12)
|
Settlement of liabilities subject to compromise and the resulting net gain were determined as follows:
|
(in thousands)
|
|
||
Accounts payable and accrued expenses
|
$
|
134,599
|
|
Accrued interest payable
|
144,184
|
|
|
Debt
|
4,023,129
|
|
|
Total liabilities subject to compromise
|
4,301,912
|
|
|
Recognition of an additional claim for the Predecessor’s Second Lien Notes settlement
|
1,000,000
|
|
|
Funding of the general unsecured claims cash distribution pool
|
(40,000
|
)
|
|
Payment to holders of claims under the Second Lien Notes
|
(30,000
|
)
|
|
Issuance of Class A common stock to creditors
|
(1,507,162
|
)
|
|
Gain on settlement of liabilities subject to compromise
|
$
|
3,724,750
|
|
13)
|
Reflects redeemable noncontrolling interests classified as temporary equity related to the incentive interest awards issued by Holdco to certain members of its management. See Note 14 for additional information.
|
14)
|
Net increase in capital accounts reflects:
|
(in thousands)
|
|
||
Issuance of Class A common stock to creditors
|
$
|
1,507,162
|
|
Issuance of Class A common stock pursuant to the rights offerings
|
530,019
|
|
|
Payment of the rights offerings backstop commitment premium
|
(15,900
|
)
|
|
Payment of issuance costs
|
(50
|
)
|
|
Share-based compensation expenses
|
13,750
|
|
|
Cancellation of the Predecessor’s units issued and outstanding
|
5,386,812
|
|
|
Par value of Class A common stock
|
(89
|
)
|
|
Change in additional paid-in capital
|
7,421,704
|
|
|
Par value of Class A common stock
|
89
|
|
|
Predecessor’s units issued and outstanding
|
(5,386,812
|
)
|
|
Net increase in capital accounts
|
$
|
2,034,981
|
|
15)
|
Net decrease in accumulated deficit reflects:
|
16)
|
Reflects a change in accounting policy from the entitlements method to the sales method for natural gas production imbalances.
|
17)
|
Reflects the recognition of intangible assets for the current portion of favorable leases, partially offset by decreases for well equipment inventory and the write-off of historical intangible assets.
|
18)
|
Reflects a decrease of oil and natural gas properties, based on the methodology discussed above, and the elimination of accumulated depletion and amortization. The following table summarizes the components of oil and natural gas properties as of the Effective Date:
|
|
Successor
|
|
|
Predecessor
|
||||
|
Fair Value
|
|
|
Historical Book Value
|
||||
(in thousands)
|
|
|
|
|
||||
Proved properties
|
$
|
1,727,834
|
|
|
|
$
|
12,258,835
|
|
Unproved properties
|
458,943
|
|
|
|
1,010,200
|
|
||
|
2,186,777
|
|
|
|
13,269,035
|
|
||
Less accumulated depletion and amortization
|
—
|
|
|
|
(10,044,240
|
)
|
||
|
$
|
2,186,777
|
|
|
|
$
|
3,224,795
|
|
19)
|
Reflects a decrease of other property and equipment and the elimination of accumulated depreciation. The following table summarizes the components of other property and equipment as of the Effective Date:
|
|
Successor
|
|
|
Predecessor
|
||||
|
Fair Value
|
|
|
Historical Book Value
|
||||
(in thousands)
|
|
|
|
|
||||
Natural gas plants and pipelines
|
$
|
342,924
|
|
|
|
$
|
426,914
|
|
Office equipment and furniture
|
39,211
|
|
|
|
106,059
|
|
||
Buildings and leasehold improvements
|
32,817
|
|
|
|
66,023
|
|
||
Vehicles
|
16,980
|
|
|
|
30,760
|
|
||
Land
|
7,747
|
|
|
|
3,727
|
|
||
Drilling and other equipment
|
4,254
|
|
|
|
8,103
|
|
||
|
443,933
|
|
|
|
641,586
|
|
||
Less accumulated depreciation
|
—
|
|
|
|
(230,952
|
)
|
||
|
$
|
443,933
|
|
|
|
$
|
410,634
|
|
20)
|
Reflects the recognition of intangible assets for the noncurrent portion of favorable leases, as well as increases in equity method investments and carbon credit allowances. Assets and liabilities for out-of-market contracts were valued based on market terms as of February 28, 2017, and will be amortized over the remaining life of the respective lease. The Company’s equity method investments were valued based on a market approach using a market EBITDA multiple. Carbon credit allowances were valued using a market approach based on trading prices for carbon credits on February 28, 2017.
|
21)
|
Primarily reflects the write-off of deferred rent partially offset by an increase in carbon emissions liabilities.
|
22)
|
Reflects an increase of the current portion of asset retirement obligations.
|
23)
|
Primarily reflects a decrease of approximately
$49 million
for asset retirement obligations and approximately
$5 million
for deferred rent, partially offset by an increase of approximately
$1 million
for carbon emissions liabilities. The fair value of asset retirement obligations were estimated using valuation techniques that convert future cash flows to a single
|
24)
|
Reflects the cumulative impact of the fresh start accounting adjustments discussed above and the elimination of the Predecessor’s accumulated deficit.
|
|
Predecessor
|
||
|
December 31, 2016
|
||
(in thousands)
|
|
||
Assets:
|
|
||
Oil and natural gas properties
|
$
|
728,190
|
|
Other property and equipment
|
11,402
|
|
|
Other
|
1,435
|
|
|
Total assets of discontinued operations
|
$
|
741,027
|
|
Liabilities:
|
|
||
Asset retirement obligations
|
$
|
38,042
|
|
Other
|
1,481
|
|
|
Total liabilities of discontinued operations
|
$
|
39,523
|
|
|
Successor
|
|
|
Predecessor
|
||||
|
Three Months Ended September 30, 2017
|
|
|
Three Months Ended September 30, 2016
|
||||
(in thousands)
|
|
|
|
|
||||
Revenues and other
|
$
|
6,048
|
|
|
|
$
|
133,163
|
|
Expenses
|
(11,113
|
)
|
|
|
132,387
|
|
||
Other income and (expenses)
|
(750
|
)
|
|
|
(14,891
|
)
|
||
Reorganization items, net
|
—
|
|
|
|
(87,915
|
)
|
||
Income (loss) from discontinued operations before income taxes
|
16,411
|
|
|
|
(102,030
|
)
|
||
Income tax expense
|
6,347
|
|
|
|
34
|
|
||
Income (loss) from discontinued operations, net of income taxes
|
$
|
10,064
|
|
|
|
$
|
(102,064
|
)
|
|
Successor
|
|
|
Predecessor
|
||||||||
|
Seven Months Ended September 30, 2017
|
|
|
Two Months Ended February 28, 2017
|
|
Nine Months Ended September 30, 2016
|
||||||
(in thousands)
|
|
|
|
|
|
|
||||||
Revenues and other
|
$
|
33,684
|
|
|
|
$
|
14,891
|
|
|
$
|
369,112
|
|
Expenses
|
19,231
|
|
|
|
13,758
|
|
|
1,507,867
|
|
|||
Other income and (expenses)
|
(3,541
|
)
|
|
|
(1,681
|
)
|
|
(54,361
|
)
|
|||
Reorganization items, net
|
—
|
|
|
|
—
|
|
|
(38,829
|
)
|
|||
Income (loss) from discontinued operations before income taxes
|
10,912
|
|
|
|
(548
|
)
|
|
(1,231,945
|
)
|
|||
Income tax expense
|
4,102
|
|
|
|
—
|
|
|
196
|
|
|||
Income (loss) from discontinued operations, net of income taxes
|
$
|
6,810
|
|
|
|
$
|
(548
|
)
|
|
$
|
(1,232,141
|
)
|
|
Successor
|
|
|
Predecessor
|
||||
|
September 30, 2017
|
|
|
December 31, 2016
|
||||
(in thousands)
|
|
|
|
|
||||
Proved properties
|
$
|
1,188,652
|
|
|
|
$
|
11,350,257
|
|
Unproved properties
|
59,594
|
|
|
|
998,860
|
|
||
|
1,248,246
|
|
|
|
12,349,117
|
|
||
Less accumulated depletion and amortization
|
(53,370
|
)
|
|
|
(9,843,908
|
)
|
||
|
$
|
1,194,876
|
|
|
|
$
|
2,505,209
|
|
|
One Month Ended September 30, 2017
|
||
|
(in thousands)
|
||
|
|
||
Revenues
|
$
|
16,819
|
|
Expenses
|
12,145
|
|
|
Other income and (expenses)
|
(160
|
)
|
|
Net income
|
$
|
4,514
|
|
|
Successor
|
|
|
Predecessor
|
||||
|
September 30, 2017
|
|
|
December 31, 2016
|
||||
(in thousands, except percentages)
|
|
|
|
|
||||
Revolving credit facility
|
$
|
—
|
|
|
|
$
|
—
|
|
Predecessor credit facility
(1)
|
—
|
|
|
|
1,654,745
|
|
||
Predecessor term loan
(1)
|
—
|
|
|
|
284,241
|
|
||
6.50% senior notes due May 2019
|
—
|
|
|
|
562,234
|
|
||
6.25% senior notes due November 2019
|
—
|
|
|
|
581,402
|
|
||
8.625% senior notes due April 2020
|
—
|
|
|
|
718,596
|
|
||
12.00% senior secured second lien notes due December 2020
|
—
|
|
|
|
1,000,000
|
|
||
7.75% senior notes due February 2021
|
—
|
|
|
|
779,474
|
|
||
6.50% senior notes due September 2021
|
—
|
|
|
|
381,423
|
|
||
Net unamortized deferred financing fees
|
—
|
|
|
|
(1,257
|
)
|
||
Total debt, net
|
—
|
|
|
|
5,960,858
|
|
||
Less current portion, net
(2)
|
—
|
|
|
|
(1,937,729
|
)
|
||
Less liabilities subject to compromise
(3)
|
—
|
|
|
|
(4,023,129
|
)
|
||
Long-term debt
|
$
|
—
|
|
|
|
$
|
—
|
|
(1)
|
Variable interest rate of
5.50%
at December 31, 2016.
|
(2)
|
Due to covenant violations, the Predecessor’s credit facility and term loan were classified as current at December 31, 2016.
|
(3)
|
The Predecessor’s senior notes and Second Lien Notes were classified as liabilities subject to compromise at December 31, 2016. On the Effective Date, pursuant to the terms of the Plan, all outstanding amounts under these debt instruments were canceled.
|
|
Predecessor
|
||||||
|
December 31, 2016
|
||||||
|
Carrying Value
|
|
Fair Value
|
||||
|
(in thousands)
|
||||||
|
|
|
|
||||
Senior secured second lien notes
|
$
|
1,000,000
|
|
|
$
|
863,750
|
|
Senior notes, net
|
3,023,129
|
|
|
1,179,224
|
|
|
October 1
–
December 31, 2017
|
|
2018
|
|
2019
|
||||||
Natural gas positions:
|
|
|
|
|
|
||||||
Fixed price swaps (NYMEX Henry Hub):
|
|
|
|
|
|
||||||
Hedged volume (MMMBtu)
|
31,280
|
|
|
47,815
|
|
|
11,315
|
|
|||
Average price ($/MMBtu)
|
$
|
3.18
|
|
|
$
|
3.01
|
|
|
$
|
2.97
|
|
Oil positions:
|
|
|
|
|
|
||||||
Fixed price swaps (NYMEX WTI):
|
|
|
|
|
|
||||||
Hedged volume (MBbls)
|
1,104
|
|
|
548
|
|
|
—
|
|
|||
Average price ($/Bbl)
|
$
|
52.13
|
|
|
$
|
54.07
|
|
|
$
|
—
|
|
Collars (NYMEX WTI):
|
|
|
|
|
|
||||||
Hedged volume (MBbls)
|
—
|
|
|
1,825
|
|
|
1,825
|
|
|||
Average floor price ($/Bbl)
|
$
|
—
|
|
|
$
|
50.00
|
|
|
$
|
50.00
|
|
Average ceiling price ($/Bbl)
|
$
|
—
|
|
|
$
|
55.50
|
|
|
$
|
55.50
|
|
|
Successor
|
|
|
Predecessor
|
||||
|
September 30, 2017
|
|
|
December 31, 2016
|
||||
(in thousands)
|
|
|
|
|
||||
Assets:
|
|
|
|
|
||||
Commodity derivatives
|
$
|
27,897
|
|
|
|
$
|
19,369
|
|
Liabilities:
|
|
|
|
|
||||
Commodity derivatives
|
$
|
17,871
|
|
|
|
$
|
113,226
|
|
|
Successor
|
||||||||||
|
September 30, 2017
|
||||||||||
|
Level 2
|
|
Netting
(1)
|
|
Total
|
||||||
|
(in thousands)
|
||||||||||
Assets:
|
|
|
|
|
|
||||||
Commodity derivatives
|
$
|
27,897
|
|
|
$
|
(17,095
|
)
|
|
$
|
10,802
|
|
Liabilities:
|
|
|
|
|
|
||||||
Commodity derivatives
|
$
|
17,871
|
|
|
$
|
(17,095
|
)
|
|
$
|
776
|
|
|
Predecessor
|
||||||||||
|
December 31, 2016
|
||||||||||
|
Level 2
|
|
Netting
(1)
|
|
Total
|
||||||
|
(in thousands)
|
||||||||||
Assets:
|
|
|
|
|
|
||||||
Commodity derivatives
|
$
|
19,369
|
|
|
$
|
(19,369
|
)
|
|
$
|
—
|
|
Liabilities:
|
|
|
|
|
|
||||||
Commodity derivatives
|
$
|
113,226
|
|
|
$
|
(19,369
|
)
|
|
$
|
93,857
|
|
(1)
|
Represents counterparty netting under agreements governing such derivatives.
|
Asset retirement obligations at December 31, 2016 (Predecessor)
|
$
|
402,162
|
|
Liabilities added from drilling
|
146
|
|
|
Accretion expense
|
4,024
|
|
|
Settlements
|
(618
|
)
|
|
Asset retirement obligations at February 28, 2017 (Predecessor)
|
$
|
405,714
|
|
Fresh start adjustment
(1)
|
(48,317
|
)
|
|
Asset retirement obligations at February 28, 2017 (Successor)
|
$
|
357,397
|
|
Liabilities added from drilling
|
510
|
|
|
Liabilities associated with assets sold
|
(96,349
|
)
|
|
Accretion expense
|
11,233
|
|
|
Settlements
|
(5,406
|
)
|
|
Asset retirement obligations at September 30, 2017 (Successor)
|
$
|
267,385
|
|
(1)
|
As a result of the application of fresh start accounting, the Successor recorded its asset retirement obligations at fair value as of the Effective Date.
|
•
|
All units in the Predecessor that were issued and outstanding immediately prior to the Effective Date were extinguished without recovery;
|
•
|
17,678,889
shares of Class A common stock were issued pro rata to holders of the Second Lien Notes with claims allowed under the Plan;
|
•
|
26,724,396
shares of Class A common stock were issued pro rata to holders of Unsecured Notes with claims allowed under the Plan;
|
•
|
471,110
shares of Class A common stock were issued to commitment parties under the Backstop Commitment Agreement in respect of premium due thereunder;
|
•
|
2,995,691
shares of Class A common stock were issued to commitment parties under the Backstop Commitment Agreement in connection with their backstop obligation thereunder; and
|
•
|
41,359,806
shares of Class A common stock were issued to participants in the rights offerings extended by the Company to certain holders of claims arising under the Second Lien Notes and the Unsecured Notes (including, in each case, certain of the commitment parties party to the Backstop Commitment Agreement).
|
|
Successor
|
|
|
Predecessor
|
||||
|
Three Months Ended September 30, 2017
|
|
|
Three Months Ended September 30, 2016
|
||||
(in thousands)
|
|
|
|
|
||||
General and administrative expenses
|
$
|
6,277
|
|
|
|
$
|
4,832
|
|
Lease operating expenses
|
—
|
|
|
|
1,129
|
|
||
Total share-based compensation expenses
|
$
|
6,277
|
|
|
|
$
|
5,961
|
|
Income tax benefit
|
$
|
3,157
|
|
|
|
$
|
2,203
|
|
|
Successor
|
|
|
Predecessor
|
||||||||
|
Seven Months Ended September 30, 2017
|
|
|
Two Months Ended February 28, 2017
|
|
Nine Months Ended September 30, 2016
|
||||||
(in thousands)
|
|
|
|
|
|
|
||||||
General and administrative expenses
|
$
|
25,876
|
|
|
|
$
|
50,255
|
|
|
$
|
19,238
|
|
Lease operating expenses
|
—
|
|
|
|
—
|
|
|
5,276
|
|
|||
Total share-based compensation expenses
|
$
|
25,876
|
|
|
|
$
|
50,255
|
|
|
$
|
24,514
|
|
Income tax benefit
|
$
|
6,712
|
|
|
|
$
|
5,170
|
|
|
$
|
9,058
|
|
|
Successor
|
|||||||||
|
Three Months Ended September 30, 2017
|
|||||||||
|
Income
|
|
Shares
|
|
Per Share
|
|||||
|
(in thousands, except per share data)
|
|||||||||
|
|
|
|
|
|
|||||
Basic:
|
|
|
|
|
|
|||||
Income from continuing operations
|
$
|
50,964
|
|
|
87,796
|
|
|
$
|
0.58
|
|
Income from discontinued operations, net of income taxes
|
86,099
|
|
|
87,796
|
|
|
0.98
|
|
||
Net income attributable to common stockholders
|
$
|
137,063
|
|
|
87,796
|
|
|
$
|
1.56
|
|
|
|
|
|
|
|
|||||
Effect of Dilutive Securities:
|
|
|
|
|
|
|||||
Dilutive effect of restricted stock units
|
$
|
—
|
|
|
1,203
|
|
|
|
||
Dilutive effect of unvested Class A-2 units of Holdco
|
$
|
(31
|
)
|
|
—
|
|
|
|
||
|
|
|
|
|
|
|
||||
Diluted:
|
|
|
|
|
|
|||||
Income from continuing operations
|
$
|
50,933
|
|
|
88,999
|
|
|
$
|
0.57
|
|
Income from discontinued operations
|
86,099
|
|
|
88,999
|
|
|
0.97
|
|
||
Net income attributable to common stockholders
|
$
|
137,032
|
|
|
88,999
|
|
|
$
|
1.54
|
|
|
Predecessor
|
|||||||||
|
Three Months Ended September 30, 2016
|
|||||||||
|
Loss
|
|
Units
|
|
Per Unit
|
|||||
|
(in thousands, except per unit data)
|
|||||||||
|
|
|
|
|
|
|||||
Basic and Diluted:
|
|
|
|
|
|
|||||
Loss from continuing operations
|
$
|
(96,301
|
)
|
|
352,792
|
|
|
$
|
(0.27
|
)
|
Loss from discontinued operations, net of income taxes
|
(102,064
|
)
|
|
352,792
|
|
|
(0.29
|
)
|
||
Net loss attributable to common unitholders
|
$
|
(198,365
|
)
|
|
352,792
|
|
|
$
|
(0.56
|
)
|
|
Successor
|
|||||||||
|
Seven Months Ended September 30, 2017
|
|||||||||
|
Income
|
|
Shares
|
|
Per Share
|
|||||
|
(in thousands, except per share data)
|
|||||||||
|
|
|
|
|
|
|||||
Basic:
|
|
|
|
|
|
|||||
Income from continuing operations
|
$
|
267,019
|
|
|
88,966
|
|
|
$
|
3.00
|
|
Income from discontinued operations, net of income taxes
|
82,845
|
|
|
88,966
|
|
|
0.93
|
|
||
Net income attributable to common stockholders
|
$
|
349,864
|
|
|
88,966
|
|
|
$
|
3.93
|
|
|
|
|
|
|
|
|||||
Effect of Dilutive Securities:
|
|
|
|
|
|
|||||
Dilutive effect of restricted stock units
|
$
|
—
|
|
|
818
|
|
|
|
||
Dilutive effect of unvested Class A-2 units of Holdco
|
$
|
(31
|
)
|
|
—
|
|
|
|
||
|
|
|
|
|
|
|||||
Diluted:
|
|
|
|
|
|
|||||
Income from continuing operations
|
$
|
266,988
|
|
|
89,784
|
|
|
$
|
2.97
|
|
Income from discontinued operations
|
82,845
|
|
|
89,784
|
|
|
0.93
|
|
||
Net income attributable to common stockholders
|
$
|
349,833
|
|
|
89,784
|
|
|
$
|
3.90
|
|
|
Predecessor
|
|||||||||
|
Two Months Ended February 28, 2017
|
|||||||||
|
Income (Loss)
|
|
Units
|
|
Per Unit
|
|||||
|
(in thousands, except per unit data)
|
|||||||||
|
|
|
|
|
|
|||||
Basic and Diluted:
|
|
|
|
|
|
|||||
Income from continuing operations
|
$
|
2,397,609
|
|
|
352,792
|
|
|
$
|
6.80
|
|
Loss from discontinued operations, net of income taxes
|
(548
|
)
|
|
352,792
|
|
|
(0.01
|
)
|
||
Net income attributable to common unitholders
|
$
|
2,397,061
|
|
|
352,792
|
|
|
$
|
6.79
|
|
|
Predecessor
|
|||||||||
|
Nine Months Ended September 30, 2016
|
|||||||||
|
Loss
|
|
Units
|
|
Per Unit
|
|||||
|
(in thousands, except per unit data)
|
|||||||||
|
|
|
|
|
|
|||||
Basic and Diluted:
|
|
|
|
|
|
|||||
Loss from continuing operations
|
$
|
(105,478
|
)
|
|
352,606
|
|
|
$
|
(0.30
|
)
|
Loss from discontinued operations, net of income taxes
|
(1,232,141
|
)
|
|
352,606
|
|
|
(3.49
|
)
|
||
Net loss attributable to common unitholders
|
$
|
(1,337,619
|
)
|
|
352,606
|
|
|
$
|
(3.79
|
)
|
|
Successor
|
|
|
Predecessor
|
||||
|
September 30, 2017
|
|
|
December 31, 2016
|
||||
(in thousands)
|
|
|
|
|
||||
Prepaids
|
$
|
53,702
|
|
|
|
$
|
70,116
|
|
Receivable from related party
|
18,262
|
|
|
|
—
|
|
||
Inventories
|
11,251
|
|
|
|
15,097
|
|
||
Deferred financing fees
|
—
|
|
|
|
16,809
|
|
||
Other
|
2,722
|
|
|
|
3,288
|
|
||
Other current assets
|
$
|
85,937
|
|
|
|
$
|
105,310
|
|
|
Successor
|
|
|
Predecessor
|
||||
|
September 30, 2017
|
|
|
December 31, 2016
|
||||
(in thousands)
|
|
|
|
|
||||
Accrued compensation
|
$
|
25,057
|
|
|
|
$
|
16,443
|
|
Asset retirement obligations (current portion)
|
7,361
|
|
|
|
9,361
|
|
||
Deposits
|
8,153
|
|
|
|
—
|
|
||
Income taxes payable
|
56,333
|
|
|
|
—
|
|
||
Other
|
3,851
|
|
|
|
175
|
|
||
Other accrued liabilities
|
$
|
100,755
|
|
|
|
$
|
25,979
|
|
|
Successor
|
|
|
Predecessor
|
||||||||
|
Seven Months Ended September 30, 2017
|
|
|
Two Months Ended February 28, 2017
|
|
Nine Months Ended September 30, 2016
|
||||||
(in thousands)
|
|
|
|
|
|
|
||||||
Cash payments for interest, net of amounts capitalized
|
$
|
15,140
|
|
|
|
$
|
17,651
|
|
|
$
|
117,794
|
|
Cash payments for income taxes
|
$
|
275
|
|
|
|
$
|
—
|
|
|
$
|
4,427
|
|
Cash payments for reorganization items, net
|
$
|
10,802
|
|
|
|
$
|
21,571
|
|
|
$
|
5,728
|
|
|
|
|
|
|
|
|
||||||
Noncash investing activities:
|
|
|
|
|
|
|
||||||
Accrued capital expenditures
|
$
|
42,388
|
|
|
|
$
|
22,191
|
|
|
$
|
24,817
|
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
•
|
Hugoton Basin, which includes properties located in Kansas, the Oklahoma Panhandle and the Shallow Texas Panhandle;
|
•
|
Mid-Continent, which includes Oklahoma properties located in the Anadarko and Arkoma basins, as well as waterfloods in the Central Oklahoma Platform;
|
•
|
TexLa, which includes properties located in east Texas and north Louisiana;
|
•
|
Rockies, which includes properties located in Wyoming (Washakie Basin), Utah (Uinta Basin) and North Dakota (Williston Basin);
|
•
|
Permian Basin, which includes properties located in west Texas and southeast New Mexico;
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations - Continued
|
•
|
Michigan/Illinois, which includes properties located in the Antrim Shale formation in north Michigan and oil properties in south Illinois; and
|
•
|
South Texas.
|
•
|
oil, natural gas and NGL sales of approximately $206 million compared to $238 million for the three months ended September 30, 2016;
|
•
|
average daily production of approximately 586 MMcfe/d compared to 809 MMcfe/d for the three months ended September 30, 2016;
|
•
|
net income attributable to common stockholders of approximately $137 million compared to a net loss attributable to common unitholders of approximately $198 million for the three months ended September 30, 2016;
|
•
|
capital expenditures of approximately $123 million compared to $44 million for the three months ended September 30, 2016; and
|
•
|
22 wells drilled (all successful) compared to 46 wells drilled (all successful) for the three months ended September 30, 2016.
|
•
|
oil, natural gas and NGL sales of approximately $530 million and $189 million for the seven months ended September 30, 2017, and the two months ended February 28, 2017, respectively, compared to $618 million for the nine months ended September 30, 2016;
|
•
|
average daily production of approximately 664 MMcfe/d and 745 MMcfe/d for the seven months ended September 30, 2017, and the two months ended February 28, 2017, respectively, compared to 812 MMcfe/d for the nine months ended September 30, 2016;
|
•
|
net income attributable to common stockholders/unitholders of approximately $350 million and $2.4 billion for the seven months ended September 30, 2017, and the two months ended February 28, 2017, respectively, compared to a net loss attributable to unitholders of approximately $1.3 billion for the nine months ended September 30, 2016;
|
•
|
net cash provided by operating activities from continuing operations of approximately $192 million and net cash used in operating activities of approximately $30 million for the seven months ended September 30, 2017, and the two months ended February 28, 2017, respectively, compared to net cash provided by operating activities of approximately $851 million for the nine months ended September 30, 2016;
|
•
|
capital expenditures of approximately $237 million and $46 million for the seven months ended September 30, 2017, and the two months ended February 28, 2017, respectively, compared to $98 million for the nine months ended September 30, 2016; and
|
•
|
63 wells drilled (all successful) compared to 142 wells drilled (141 successful) for the nine months ended September 30, 2016.
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations - Continued
|
•
|
The Predecessor transferred all of its assets, including equity interests in its subsidiaries, other than LAC and Berry, to Linn Energy Holdco II LLC (“Holdco II”), a newly formed subsidiary of the Predecessor and the borrower under the Credit Agreement (as amended, the “Successor Credit Facility”) entered into in connection with the reorganization, in exchange for 100% of the equity of Holdco II and the issuance of interests in the Successor Credit Facility to certain of the Predecessor’s creditors in partial satisfaction of their claims (the “Contribution”). Immediately following the Contribution, the Predecessor transferred 100% of the equity interests in Holdco II to the Successor in exchange for approximately $530 million in cash and an amount of equity securities in the Successor not to exceed 49.90% of the outstanding equity interests of the Successor, which the Predecessor distributed to certain of its creditors in satisfaction of their claims. Contemporaneously with the reorganization transactions and pursuant to the Plan, (i) LAC assigned all of its rights, title and interest in the membership interests of Berry to Berry Petroleum Corporation, (ii) all of the equity interests in LAC and the Predecessor were canceled and (iii) LAC and the Predecessor commenced liquidation, which is expected to be completed following the resolution of the respective companies’ outstanding claims.
|
•
|
The holders of claims under the Predecessor’s Sixth Amended and Restated Credit Agreement (“Predecessor Credit Facility”) received a full recovery, consisting of a cash paydown and their pro rata share of the $1.7 billion Successor Credit Facility. As a result, all outstanding obligations under the Predecessor Credit Facility were canceled.
|
•
|
Holdco II, as borrower, entered into the Successor Credit Facility with the holders of claims under the Predecessor Credit Facility, as lenders, and Wells Fargo Bank, National Association, as administrative agent, providing for a new reserve-based revolving loan with up to $1.4 billion in borrowing commitments and a new term loan in an original principal amount of $300 million. For additional information, see “Financing Activities” below.
|
•
|
The holders of the Company’s 12.00% senior secured second lien notes due December 2020 (the “Second Lien Notes”) received their pro rata share of (i) 17,678,889 shares of Class A common stock; (ii) certain rights to purchase shares of Class A common stock in the rights offerings, as described below; and (iii) $30 million in cash. The holders of the Company’s 6.50% senior notes due May 2019, 6.25% senior notes due November 2019, 8.625% senior notes due 2020, 7.75% senior notes due February 2021 and 6.50% senior notes due September 2021 (collectively, the “Unsecured Notes”) received their pro rata share of (i) 26,724,396 shares of Class A common stock; and (ii) certain rights to purchase shares of Class A common stock in the rights offerings, as described below. As a result, all outstanding obligations under the Second Lien Notes and the Unsecured Notes and the indentures governing such obligations were canceled.
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations - Continued
|
•
|
The holders of general unsecured claims (other than claims relating to the Second Lien Notes and the Unsecured Notes) against the LINN Debtors (the “LINN Unsecured Claims”) received their pro rata share of cash from two cash distribution pools totaling $40 million, as divided between a $2.3 million cash distribution pool for the payment in full of allowed LINN Unsecured Claims in an amount equal to $2,500 or less (and larger claims for which the holders irrevocably agreed to reduce such claims to $2,500), and a $37.7 million cash distribution pool for pro rata distributions to all remaining allowed general LINN Unsecured Claims. As a result, all outstanding LINN Unsecured Claims were fully satisfied, settled, released and discharged as of the Effective Date.
|
•
|
All units of the Predecessor that were issued and outstanding immediately prior to the Effective Date were extinguished without recovery. On the Effective Date, the Successor issued in the aggregate 89,229,892 shares of Class A common stock. No cash was raised from the issuance of the Class A common stock on account of claims held by the Predecessor’s creditors.
|
•
|
The Successor entered into a registration rights agreement with certain parties, pursuant to which the Company agreed to, among other things, file a registration statement with the Securities and Exchange Commission within 60 days of the Effective Date covering the offer and resale of “Registrable Securities” (as defined therein).
|
•
|
By operation of the Plan and the Confirmation Order, the terms of the Predecessor’s board of directors expired as of the Effective Date. The Successor formed a new board of directors, consisting of the Chief Executive Officer of the Predecessor, one director selected by the Successor and five directors selected by a six-person selection committee.
|
•
|
On September 12, 2017, August 1, 2017, and July 31, 2017, the Company completed the sales of its interest in certain properties located in south Texas (the “South Texas Assets Sales”). Combined cash proceeds received from the sale of these properties were approximately $49 million, net of costs to sell of approximately $1 million, and the Company recognized a combined net gain of approximately $14 million.
|
•
|
On August 23, 2017, July 28, 2017, and May 9, 2017, the Company completed the sales of its interest in certain properties located in Texas and New Mexico (the “Permian Assets Sales”). Combined cash proceeds received from the sale of these properties were approximately $31 million and the Company recognized a combined net gain of approximately $29 million.
|
•
|
On July 31, 2017, the Company completed the sale of its interest in properties located in the San Joaquin Basin in California to Berry Petroleum Company, LLC (the “San Joaquin Basin Sale”). Cash proceeds received from the sale
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations - Continued
|
•
|
On July 21, 2017, the Company completed the sale of its interest in properties located in the Los Angeles Basin in California to Bridge Energy LLC (the “Los Angeles Basin Sale”). Cash proceeds received from the sale of these properties were approximately $93 million, net of costs to sell of approximately $1 million, and the Company recognized a net gain of approximately $2 million. The Company will receive an additional $7 million contingent payment if certain operational requirements are satisfied within one year.
|
•
|
On June 30, 2017, the Company completed the sale of its interest in properties located in the Salt Creek Field in Wyoming to Denbury Resources Inc. (the “Salt Creek Assets Sale”). Cash proceeds received from the sale of these properties were approximately $75 million, net of costs to sell of approximately $1 million, and the Company recognized a net gain of approximately $33 million.
|
•
|
On May 31, 2017, the Company completed the sale of its interest in properties located in western Wyoming to Jonah Energy LLC (the “Jonah Assets Sale”). Cash proceeds received from the sale of these properties were approximately $560 million, net of costs to sell of approximately $6 million, and the Company recognized a net gain of approximately $272 million.
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations - Continued
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations - Continued
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations - Continued
|
|
Successor
|
|
|
Predecessor
|
|
|
||||||
|
Three Months Ended September 30,
2017
|
|
|
Three Months Ended September 30,
2016
|
|
Variance
|
||||||
(in thousands)
|
|
|
|
|
|
|
||||||
Revenues and other:
|
|
|
|
|
|
|
||||||
Natural gas sales
|
$
|
92,470
|
|
|
|
$
|
121,842
|
|
|
$
|
(29,372
|
)
|
Oil sales
|
74,384
|
|
|
|
82,244
|
|
|
(7,860
|
)
|
|||
NGL sales
|
39,464
|
|
|
|
33,900
|
|
|
5,564
|
|
|||
Total oil, natural gas and NGL sales
|
206,318
|
|
|
|
237,986
|
|
|
(31,668
|
)
|
|||
Gains (losses) on oil and natural gas derivatives
|
(14,497
|
)
|
|
|
166
|
|
|
(14,663
|
)
|
|||
Marketing and other revenues
(1)
|
44,861
|
|
|
|
28,823
|
|
|
16,038
|
|
|||
|
236,682
|
|
|
|
266,975
|
|
|
(30,293
|
)
|
|||
Expenses:
|
|
|
|
|
|
|
||||||
Lease operating expenses
|
61,272
|
|
|
|
67,234
|
|
|
(5,962
|
)
|
|||
Transportation expenses
|
34,541
|
|
|
|
40,986
|
|
|
(6,445
|
)
|
|||
Marketing expenses
|
34,099
|
|
|
|
6,933
|
|
|
27,166
|
|
|||
General and administrative expenses
(2)
|
30,035
|
|
|
|
48,471
|
|
|
(18,436
|
)
|
|||
Exploration costs
|
171
|
|
|
|
4
|
|
|
167
|
|
|||
Depreciation, depletion and amortization
|
29,657
|
|
|
|
87,413
|
|
|
(57,756
|
)
|
|||
Impairment of long-lived assets
|
—
|
|
|
|
41,728
|
|
|
(41,728
|
)
|
|||
Taxes, other than income taxes
|
12,368
|
|
|
|
18,003
|
|
|
(5,635
|
)
|
|||
(Gains) losses on sale of assets and other, net
|
(26,977
|
)
|
|
|
2,532
|
|
|
(29,509
|
)
|
|||
|
175,166
|
|
|
|
313,304
|
|
|
(138,138
|
)
|
|||
Other income and (expenses)
|
(1,885
|
)
|
|
|
(25,261
|
)
|
|
23,376
|
|
|||
Reorganization items, net
|
(2,605
|
)
|
|
|
(28,361
|
)
|
|
25,756
|
|
|||
Income (loss) from continuing operations before income taxes
|
57,026
|
|
|
|
(99,951
|
)
|
|
156,977
|
|
|||
Income tax expense (benefit)
|
5,996
|
|
|
|
(3,650
|
)
|
|
9,646
|
|
|||
Income (loss) from continuing operations
|
51,030
|
|
|
|
(96,301
|
)
|
|
147,331
|
|
|||
Income (loss) from discontinued operations, net of income taxes
|
86,099
|
|
|
|
(102,064
|
)
|
|
188,163
|
|
|||
Net income (loss)
|
137,129
|
|
|
|
(198,365
|
)
|
|
335,494
|
|
|||
Net income attributable to noncontrolling interests
|
66
|
|
|
|
—
|
|
|
66
|
|
|||
Net income (loss) attributable to common stockholders/unitholders
|
$
|
137,063
|
|
|
|
$
|
(198,365
|
)
|
|
$
|
335,428
|
|
(1)
|
Marketing and other revenues for the three months ended September 30, 2016, include approximately $14 million of management fee revenues recognized by the Company from Berry. Management fee revenues are included in “other revenues” on the condensed consolidated statement of operations.
|
(2)
|
General and administrative expenses for the three months ended September 30, 2017, and September 30, 2016, include approximately $6 million and $5 million, respectively, of noncash share-based compensation expenses. In addition, general and administrative expenses for the three months ended September 30, 2016, include expenses incurred by LINN Energy associated with the operations of Berry. On February 28, 2017, LINN Energy and Berry emerged from Bankruptcy as stand-alone, unaffiliated entities.
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations - Continued
|
|
Successor
|
|
|
Predecessor
|
|
|
|||||
|
Three Months Ended September 30,
2017
|
|
|
Three Months Ended September 30,
2016
|
|
Variance
|
|||||
Average daily production:
|
|
|
|
|
|
|
|||||
Natural gas (MMcf/d)
|
368
|
|
|
|
518
|
|
|
(29
|
)%
|
||
Oil (MBbls/d)
|
17.7
|
|
|
|
22.0
|
|
|
(20
|
)%
|
||
NGL (MBbls/d)
|
18.5
|
|
|
|
26.6
|
|
|
(30
|
)%
|
||
Total (MMcfe/d)
|
586
|
|
|
|
809
|
|
|
(28
|
)%
|
||
|
|
|
|
|
|
|
|||||
Average daily production – Equity method investments:
(1)
|
|
|
|
|
|
|
|||||
Total (MMcfe/d)
|
23
|
|
|
|
—
|
|
|
|
|||
|
|
|
|
|
|
|
|||||
Weighted average prices:
(2)
|
|
|
|
|
|
|
|||||
Natural gas (Mcf)
|
$
|
2.73
|
|
|
|
$
|
2.56
|
|
|
7
|
%
|
Oil (Bbl)
|
$
|
45.58
|
|
|
|
$
|
40.60
|
|
|
12
|
%
|
NGL (Bbl)
|
$
|
23.18
|
|
|
|
$
|
13.87
|
|
|
67
|
%
|
|
|
|
|
|
|
|
|||||
Average NYMEX prices:
|
|
|
|
|
|
|
|||||
Natural gas (MMBtu)
|
$
|
3.00
|
|
|
|
$
|
2.81
|
|
|
7
|
%
|
Oil (Bbl)
|
$
|
48.20
|
|
|
|
$
|
44.94
|
|
|
7
|
%
|
|
|
|
|
|
|
|
|||||
Costs per Mcfe of production:
|
|
|
|
|
|
|
|||||
Lease operating expenses
|
$
|
1.14
|
|
|
|
$
|
0.90
|
|
|
27
|
%
|
Transportation expenses
|
$
|
0.64
|
|
|
|
$
|
0.55
|
|
|
16
|
%
|
General and administrative expenses
(3)
|
$
|
0.56
|
|
|
|
$
|
0.65
|
|
|
(14
|
)%
|
Depreciation, depletion and amortization
|
$
|
0.55
|
|
|
|
$
|
1.17
|
|
|
(53
|
)%
|
Taxes, other than income taxes
|
$
|
0.23
|
|
|
|
$
|
0.24
|
|
|
(4
|
)%
|
|
|
|
|
|
|
|
|||||
Average daily production – discontinued operations:
(4)
|
|
|
|
|
|
|
|||||
Total (MMcfe/d)
|
8
|
|
|
|
265
|
|
|
|
|
(1)
|
Represents the Company’s 50% equity interest in Roan. Production of Roan for 2017 is for the period from September 1, 2017 through September 30, 2017.
|
(2)
|
Does not include the effect of gains (losses) on derivatives.
|
(3)
|
General and administrative expenses for the three months ended September 30, 2017, and September 30, 2016, include approximately $6 million and $5 million, respectively, of noncash share-based compensation expenses. In addition, general and administrative expenses for the three months ended September 30, 2016, include expenses incurred by LINN Energy associated with the operations of Berry. On February 28, 2017, LINN Energy and Berry emerged from Bankruptcy as stand-alone, unaffiliated entities.
|
(4)
|
Production of discontinued operations for 2017 is for the period from July 1, 2017 through July 31, 2017.
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations - Continued
|
|
Successor
|
|
|
Predecessor
|
|
|
|
|
|||||
|
Three Months Ended September 30,
2017
|
|
|
Three Months Ended September 30,
2016
|
|
Variance
|
|||||||
Average daily production (MMcfe/d):
|
|
|
|
|
|
|
|
|
|||||
Rockies
|
160
|
|
|
|
343
|
|
|
(183
|
)
|
|
(54
|
)%
|
|
Hugoton Basin
|
171
|
|
|
|
178
|
|
|
(7
|
)
|
|
(4
|
)%
|
|
Mid-Continent
|
91
|
|
|
|
102
|
|
|
(11
|
)
|
|
(11
|
)%
|
|
TexLa
|
81
|
|
|
|
73
|
|
|
8
|
|
|
12
|
%
|
|
Permian Basin
|
43
|
|
|
|
54
|
|
|
(11
|
)
|
|
(19
|
)%
|
|
Michigan/Illinois
|
29
|
|
|
|
30
|
|
|
(1
|
)
|
|
(6
|
)%
|
|
South Texas
|
11
|
|
|
|
29
|
|
|
(18
|
)
|
|
(62
|
)%
|
|
|
586
|
|
|
|
809
|
|
|
(223
|
)
|
|
(28
|
)%
|
|
Equity method investments
|
23
|
|
|
—
|
|
—
|
|
|
|
|
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations - Continued
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations - Continued
|
|
Successor
|
|
|
Predecessor
|
|
|
||||||
|
Three Months Ended September 30,
2017
|
|
|
Three Months Ended September 30,
2016
|
|
Variance
|
||||||
(in thousands)
|
|
|
|
|
|
|
||||||
Severance taxes
|
$
|
7,610
|
|
|
|
$
|
10,871
|
|
|
$
|
(3,261
|
)
|
Ad valorem taxes
|
4,983
|
|
|
|
7,120
|
|
|
(2,137
|
)
|
|||
Other
|
(225
|
)
|
|
|
12
|
|
|
(237
|
)
|
|||
|
$
|
12,368
|
|
|
|
$
|
18,003
|
|
|
$
|
(5,635
|
)
|
•
|
Advisory fees of approximately $17 million associated with the Roan Contribution;
|
•
|
Net gain of approximately $25 million on the Permian Assets Sales; and
|
•
|
Net gain of approximately $14 million, including costs to sell of approximately $1 million, on the South Texas Assets Sales.
|
|
Successor
|
|
|
Predecessor
|
|
|
||||||
|
Three Months Ended September 30,
2017
|
|
|
Three Months Ended September 30,
2016
|
|
Variance
|
||||||
(in thousands)
|
|
|
|
|
|
|
||||||
Interest expense, net of amounts capitalized
|
$
|
(223
|
)
|
|
|
$
|
(25,283
|
)
|
|
$
|
25,060
|
|
Earnings from equity method investments
|
2,575
|
|
|
|
222
|
|
|
2,353
|
|
|||
Other, net
|
(4,237
|
)
|
|
|
(200
|
)
|
|
(4,037
|
)
|
|||
|
$
|
(1,885
|
)
|
|
|
$
|
(25,261
|
)
|
|
$
|
23,376
|
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations - Continued
|
|
Successor
|
|
|
Predecessor
|
||||
|
Three Months Ended September 30,
2017
|
|
|
Three Months Ended September 30,
2016
|
||||
(in thousands)
|
|
|
|
|
||||
Legal and other professional advisory fees
|
$
|
(2,549
|
)
|
|
|
$
|
(16,714
|
)
|
Terminated contracts
|
—
|
|
|
|
(13,123
|
)
|
||
Other
|
(56
|
)
|
|
|
1,476
|
|
||
Reorganization items, net
|
$
|
(2,605
|
)
|
|
|
$
|
(28,361
|
)
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations - Continued
|
|
Successor
|
|
|
Predecessor
|
||||||||
|
Seven Months Ended September 30, 2017
|
|
|
Two Months Ended February 28, 2017
|
|
Nine Months Ended September 30, 2016
|
||||||
(in thousands)
|
|
|
|
|
|
|
||||||
Revenues and other:
|
|
|
|
|
|
|
||||||
Natural gas sales
|
$
|
241,021
|
|
|
|
$
|
99,561
|
|
|
$
|
300,585
|
|
Oil sales
|
193,859
|
|
|
|
58,560
|
|
|
228,766
|
|
|||
NGL sales
|
94,930
|
|
|
|
30,764
|
|
|
88,923
|
|
|||
Total oil, natural gas and NGL sales
|
529,810
|
|
|
|
188,885
|
|
|
618,274
|
|
|||
Gains (losses) on oil and natural gas derivatives
|
19,258
|
|
|
|
92,691
|
|
|
(74,175
|
)
|
|||
Marketing and other revenues
(1)
|
68,741
|
|
|
|
16,551
|
|
|
98,382
|
|
|||
|
617,809
|
|
|
|
298,127
|
|
|
642,481
|
|
|||
Expenses:
|
|
|
|
|
|
|
||||||
Lease operating expenses
|
156,959
|
|
|
|
49,665
|
|
|
220,847
|
|
|||
Transportation expenses
|
85,652
|
|
|
|
25,972
|
|
|
124,609
|
|
|||
Marketing expenses
|
43,614
|
|
|
|
4,820
|
|
|
21,493
|
|
|||
General and administrative expenses
(2)
|
74,904
|
|
|
|
71,745
|
|
|
184,360
|
|
|||
Exploration costs
|
1,037
|
|
|
|
93
|
|
|
2,745
|
|
|||
Depreciation, depletion and amortization
|
101,558
|
|
|
|
47,155
|
|
|
262,880
|
|
|||
Impairment of long-lived assets
|
—
|
|
|
|
—
|
|
|
165,044
|
|
|||
Taxes, other than income taxes
|
37,316
|
|
|
|
14,877
|
|
|
53,544
|
|
|||
(Gains) losses
on sale of assets and other, net
|
(333,371
|
)
|
|
|
829
|
|
|
6,607
|
|
|||
|
167,669
|
|
|
|
215,156
|
|
|
1,042,129
|
|
|||
Other income and (expenses)
|
(15,057
|
)
|
|
|
(16,717
|
)
|
|
(160,323
|
)
|
|||
Reorganization items, net
|
(8,547
|
)
|
|
|
2,331,189
|
|
|
457,437
|
|
|||
Income (loss) from continuing operations before income taxes
|
426,536
|
|
|
|
2,397,443
|
|
|
(102,534
|
)
|
|||
Income tax expense (benefit)
|
159,451
|
|
|
|
(166
|
)
|
|
2,944
|
|
|||
Income (loss) from continuing operations
|
267,085
|
|
|
|
2,397,609
|
|
|
(105,478
|
)
|
|||
Income (loss) from discontinued operations, net of income taxes
|
82,845
|
|
|
|
(548
|
)
|
|
(1,232,141
|
)
|
|||
Net income (loss)
|
349,930
|
|
|
|
2,397,061
|
|
|
(1,337,619
|
)
|
|||
Net income attributable to noncontrolling interests
|
66
|
|
|
|
—
|
|
|
—
|
|
|||
Net income (loss) attributable to common stockholders/unitholders
|
$
|
349,864
|
|
|
|
$
|
2,397,061
|
|
|
$
|
(1,337,619
|
)
|
(1)
|
Marketing and other revenues for the two months ended February 28, 2017, and the nine months ended September 30, 2016, include approximately $6 million and $56 million, respectively, of management fee revenues recognized by the Company from Berry. Management fee revenues are included in “other revenues” on the condensed consolidated statements of operations.
|
(2)
|
General and administrative expenses for the seven months ended September 30, 2017, the two months ended February 28, 2017, and the nine months ended September 30, 2016, include approximately $26 million, $50 million and $19 million, respectively, of noncash share-based compensation expenses. In addition, general and administrative expenses for the two months ended February 28, 2017, and the nine months ended September 30, 2016, include expenses incurred by LINN Energy associated with the operations of Berry. On February 28, 2017, LINN Energy and Berry emerged from bankruptcy as stand-alone, unaffiliated entities.
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations - Continued
|
|
Successor
|
|
|
Predecessor
|
||||||||
|
Seven Months Ended September 30, 2017
|
|
|
Two Months Ended February 28, 2017
|
|
Nine Months Ended September 30, 2016
|
||||||
Average daily production:
|
|
|
|
|
|
|
||||||
Natural gas (MMcf/d)
|
414
|
|
|
|
495
|
|
|
521
|
|
|||
Oil (MBbls/d)
|
19.8
|
|
|
|
20.2
|
|
|
22.6
|
|
|||
NGL (MBbls/d)
|
21.8
|
|
|
|
21.4
|
|
|
25.8
|
|
|||
Total (MMcfe/d)
|
664
|
|
|
|
745
|
|
|
812
|
|
|||
|
|
|
|
|
|
|
||||||
Average daily production – Equity method investments:
(1)
|
|
|
|
|
|
|
||||||
Total (MMcfe/d)
|
10
|
|
|
|
—
|
|
|
—
|
|
|||
|
|
|
|
|
|
|
||||||
Weighted average prices:
(2)
|
|
|
|
|
|
|
||||||
Natural gas (Mcf)
|
$
|
2.72
|
|
|
|
$
|
3.41
|
|
|
$
|
2.10
|
|
Oil (Bbl)
|
$
|
45.71
|
|
|
|
$
|
49.16
|
|
|
$
|
36.96
|
|
NGL (Bbl)
|
$
|
20.32
|
|
|
|
$
|
24.37
|
|
|
$
|
12.57
|
|
|
|
|
|
|
|
|
||||||
Average NYMEX prices:
|
|
|
|
|
|
|
||||||
Natural gas (MMBtu)
|
$
|
3.03
|
|
|
|
$
|
3.66
|
|
|
$
|
2.29
|
|
Oil (Bbl)
|
$
|
48.45
|
|
|
|
$
|
53.04
|
|
|
$
|
41.33
|
|
|
|
|
|
|
|
|
||||||
Costs per Mcfe of production:
|
|
|
|
|
|
|
||||||
Lease operating expenses
|
$
|
1.11
|
|
|
|
$
|
1.13
|
|
|
$
|
0.99
|
|
Transportation expenses
|
$
|
0.60
|
|
|
|
$
|
0.59
|
|
|
$
|
0.56
|
|
General and administrative expenses
(3)
|
$
|
0.53
|
|
|
|
$
|
1.63
|
|
|
$
|
0.83
|
|
Depreciation, depletion and amortization
|
$
|
0.72
|
|
|
|
$
|
1.07
|
|
|
$
|
1.18
|
|
Taxes, other than income taxes
|
$
|
0.26
|
|
|
|
$
|
0.34
|
|
|
$
|
0.24
|
|
|
|
|
|
|
|
|
||||||
Average daily production – discontinued operations:
(4)
|
|
|
|
|
|
|
||||||
Total (MMcfe/d)
|
20
|
|
|
|
30
|
|
|
277
|
|
(1)
|
Represents the Company’s 50% equity interest in Roan. Production of Roan for 2017 is for the period from September 1, 2017 through September 30, 2017.
|
(2)
|
Does not include the effect of gains (losses) on derivatives.
|
(3)
|
General and administrative expenses for the seven months ended September 30, 2017, the two months ended February 28, 2017, and the nine months ended September 30, 2016, include approximately $26 million, $50 million and $19 million, respectively, of noncash share-based compensation expenses. In addition, general and administrative expenses for the two months ended February 28, 2017, and the nine months ended September 30, 2016, include expenses incurred by LINN Energy associated with the operations of Berry. On February 28, 2017, LINN Energy and Berry emerged from bankruptcy as stand-alone, unaffiliated entities.
|
(4)
|
Production of discontinued operations for 2017 is for the period from January 1, 2017 through July 31, 2017.
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations - Continued
|
|
Successor
|
|
|
Predecessor
|
||||||
|
Seven Months Ended September 30, 2017
|
|
|
Two Months Ended February 28, 2017
|
|
Nine Months Ended September 30, 2016
|
||||
Average daily production (MMcfe/d):
|
|
|
|
|
|
|
||||
Rockies
|
213
|
|
|
|
294
|
|
|
339
|
|
|
Hugoton Basin
|
168
|
|
|
|
159
|
|
|
183
|
|
|
Mid-Continent
|
111
|
|
|
|
109
|
|
|
100
|
|
|
TexLa
|
79
|
|
|
|
80
|
|
|
72
|
|
|
Permian Basin
|
45
|
|
|
|
49
|
|
|
58
|
|
|
Michigan/Illinois
|
29
|
|
|
|
29
|
|
|
31
|
|
|
South Texas
|
19
|
|
|
|
25
|
|
|
29
|
|
|
|
664
|
|
|
|
745
|
|
|
812
|
|
|
Equity method investments
|
10
|
|
|
—
|
|
—
|
|
|
—
|
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations - Continued
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations - Continued
|
|
Successor
|
|
|
Predecessor
|
||||||||
|
Seven Months Ended September 30, 2017
|
|
|
Two Months Ended February 28, 2017
|
|
Nine Months Ended September 30, 2016
|
||||||
(in thousands)
|
|
|
|
|
|
|
||||||
Severance taxes
|
$
|
22,142
|
|
|
|
$
|
9,107
|
|
|
$
|
28,028
|
|
Ad valorem taxes
|
15,084
|
|
|
|
5,744
|
|
|
24,501
|
|
|||
Other
|
90
|
|
|
|
26
|
|
|
1,015
|
|
|||
|
$
|
37,316
|
|
|
|
$
|
14,877
|
|
|
$
|
53,544
|
|
•
|
Advisory fees of approximately $17 million associated with the Roan Contribution;
|
•
|
Net gain of approximately $29 million on the Permian Assets Sales;
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations - Continued
|
•
|
Net gain of approximately $14 million, including costs to sell of approximately $1 million, on the South Texas Assets Sales;
|
•
|
Net gain of approximately $33 million, including costs to sell of approximately $1 million, on the Salt Creek Assets Sale; and
|
•
|
Net gain of approximately $272 million, including costs to sell of approximately $6 million, on the Jonah Assets Sale.
|
|
Successor
|
|
|
Predecessor
|
||||||||
|
Seven Months Ended September 30, 2017
|
|
|
Two Months Ended February 28, 2017
|
|
Nine Months Ended September 30, 2016
|
||||||
(in thousands)
|
|
|
|
|
|
|
||||||
Interest expense, net of amounts capitalized
|
$
|
(11,974
|
)
|
|
|
$
|
(16,725
|
)
|
|
$
|
(159,476
|
)
|
Earnings from equity method investments
|
2,705
|
|
|
|
157
|
|
|
511
|
|
|||
Other, net
|
(5,788
|
)
|
|
|
(149
|
)
|
|
(1,358
|
)
|
|||
|
$
|
(15,057
|
)
|
|
|
$
|
(16,717
|
)
|
|
$
|
(160,323
|
)
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations - Continued
|
|
Successor
|
|
|
Predecessor
|
||||||||
|
Seven Months Ended September 30, 2017
|
|
|
Two Months Ended February 28, 2017
|
|
Nine Months Ended September 30, 2016
|
||||||
(in thousands)
|
|
|
|
|
|
|
||||||
Gain on settlement of liabilities subject to compromise
|
$
|
—
|
|
|
|
$
|
3,724,750
|
|
|
$
|
—
|
|
Recognition of an additional claim for the Predecessor’s Second Lien Notes settlement
|
—
|
|
|
|
(1,000,000
|
)
|
|
—
|
|
|||
Fresh start valuation adjustments
|
—
|
|
|
|
(591,525
|
)
|
|
—
|
|
|||
Income tax benefit related to implementation of the Plan
|
—
|
|
|
|
264,889
|
|
|
—
|
|
|||
Legal and other professional advisory fees
|
(8,565
|
)
|
|
|
(46,961
|
)
|
|
(30,165
|
)
|
|||
Unamortized deferred financing fees, discounts and premiums
|
—
|
|
|
|
—
|
|
|
(52,045
|
)
|
|||
Gain related to interest payable on Predecessor’s Second Lien Notes
|
—
|
|
|
|
—
|
|
|
551,000
|
|
|||
Terminated contracts
|
—
|
|
|
|
(6,915
|
)
|
|
(13,123
|
)
|
|||
Other
|
18
|
|
|
|
(13,049
|
)
|
|
1,770
|
|
|||
Reorganization items, net
|
$
|
(8,547
|
)
|
|
|
$
|
2,331,189
|
|
|
$
|
457,437
|
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations - Continued
|
|
Successor
|
|
|
Predecessor
|
||||||||
|
Seven Months Ended September 30, 2017
|
|
|
Two Months Ended February 28, 2017
|
|
Nine Months Ended September 30, 2016
|
||||||
(in thousands)
|
|
|
|
|
|
|
||||||
Oil and natural gas
|
$
|
168,446
|
|
|
|
$
|
39,409
|
|
|
$
|
66,066
|
|
Plant and pipeline
|
63,923
|
|
|
|
4,990
|
|
|
25,188
|
|
|||
Other
|
5,015
|
|
|
|
1,243
|
|
|
6,259
|
|
|||
Capital expenditures, excluding acquisitions
|
$
|
237,384
|
|
|
|
$
|
45,642
|
|
|
$
|
97,513
|
|
Capital expenditures, excluding acquisitions – discontinued operations
|
$
|
2,007
|
|
|
|
$
|
436
|
|
|
$
|
17,282
|
|
|
Successor
|
|
|
Predecessor
|
||||||||
|
Seven Months Ended September 30, 2017
|
|
|
Two Months Ended February 28, 2017
|
|
Nine Months Ended September 30, 2016
|
||||||
(in thousands)
|
|
|
|
|
|
|
||||||
Net cash:
|
|
|
|
|
|
|
||||||
Provided by (used in) operating activities
|
$
|
194,605
|
|
|
|
$
|
(20,814
|
)
|
|
$
|
885,192
|
|
Provided by (used in) investing activities
|
851,583
|
|
|
|
(58,756
|
)
|
|
(129,063
|
)
|
|||
Provided by (used in) financing activities
|
(1,068,501
|
)
|
|
|
(560,932
|
)
|
|
42,210
|
|
|||
Net increase (decrease) in cash and cash equivalents
|
$
|
(22,313
|
)
|
|
|
$
|
(640,502
|
)
|
|
$
|
798,339
|
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations - Continued
|
|
Successor
|
|
|
Predecessor
|
||||||||
|
Seven Months Ended September 30, 2017
|
|
|
Two Months Ended February 28, 2017
|
|
Nine Months Ended September 30, 2016
|
||||||
(in thousands)
|
|
|
|
|
|
|
||||||
Cash flow from investing activities:
|
|
|
|
|
|
|
||||||
Capital expenditures
|
$
|
(197,294
|
)
|
|
|
$
|
(58,006
|
)
|
|
$
|
(144,875
|
)
|
Proceeds from sale of properties and equipment and other
|
703,234
|
|
|
|
(166
|
)
|
|
(3,321
|
)
|
|||
Net cash provided by (used in) investing activities –
continuing operations
|
505,940
|
|
|
|
(58,172
|
)
|
|
(148,196
|
)
|
|||
Net cash provided by (used in) investing activities – discontinued operations
|
345,643
|
|
|
|
(584
|
)
|
|
19,133
|
|
|||
Net cash provided by (used in) investing activities
|
$
|
851,583
|
|
|
|
$
|
(58,756
|
)
|
|
$
|
(129,063
|
)
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations - Continued
|
|
Successor
|
|
|
Predecessor
|
||||||||
|
Seven Months Ended September 30, 2017
|
|
|
Two Months Ended February 28, 2017
|
|
Nine Months Ended September 30, 2016
|
||||||
(in thousands)
|
|
|
|
|
|
|
||||||
Proceeds from borrowings:
|
|
|
|
|
|
|
||||||
Successor Credit Facility
|
$
|
190,000
|
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Predecessor Credit Facility
|
—
|
|
|
|
—
|
|
|
978,500
|
|
|||
|
$
|
190,000
|
|
|
|
$
|
—
|
|
|
$
|
978,500
|
|
Repayments of debt:
|
|
|
|
|
|
|
||||||
Successor Credit Facility
|
$
|
(790,000
|
)
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Successor Term Loan
|
(300,000
|
)
|
|
|
—
|
|
|
—
|
|
|||
Predecessor Credit Facility
|
—
|
|
|
|
(1,038,986
|
)
|
|
(814,299
|
)
|
|||
Predecessor Term Loan
|
—
|
|
|
|
—
|
|
|
(98,911
|
)
|
|||
|
$
|
(1,090,000
|
)
|
|
|
$
|
(1,038,986
|
)
|
|
$
|
(913,210
|
)
|
|
Successor
|
|
|
Predecessor
|
||||
|
September 30, 2017
|
|
|
December 31, 2016
|
||||
(in thousands, except percentages)
|
|
|
|
|
||||
Revolving credit facility
|
$
|
—
|
|
|
|
$
|
—
|
|
Predecessor credit facility
|
—
|
|
|
|
1,654,745
|
|
||
Predecessor term loan
|
—
|
|
|
|
284,241
|
|
||
6.50% senior notes due May 2019
|
—
|
|
|
|
562,234
|
|
||
6.25% senior notes due November 2019
|
—
|
|
|
|
581,402
|
|
||
8.625% senior notes due April 2020
|
—
|
|
|
|
718,596
|
|
||
12.00% senior secured second lien notes due December 2020
|
—
|
|
|
|
1,000,000
|
|
||
7.75% senior notes due February 2021
|
—
|
|
|
|
779,474
|
|
||
6.50% senior notes due September 2021
|
—
|
|
|
|
381,423
|
|
||
Net unamortized deferred financing fees
|
—
|
|
|
|
(1,257
|
)
|
||
Total debt, net
|
—
|
|
|
|
5,960,858
|
|
||
Less current portion, net
(1)
|
—
|
|
|
|
(1,937,729
|
)
|
||
Less liabilities subject to compromise
(2)
|
—
|
|
|
|
(4,023,129
|
)
|
||
Long-term debt
|
$
|
—
|
|
|
|
$
|
—
|
|
(1)
|
Due to covenant violations, the Predecessor’s credit facility and term loan were classified as current at December 31, 2016.
|
(2)
|
The Predecessor’s senior notes and Second Lien Notes were classified as liabilities subject to compromise at December 31, 2016. On the Effective Date, pursuant to the terms of the Plan, all outstanding amounts under these debt instruments were canceled.
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations - Continued
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations - Continued
|
•
|
business strategy;
|
•
|
acquisition and disposition strategy;
|
•
|
financial strategy;
|
•
|
new capital structure and the adoption of fresh start accounting;
|
•
|
uncertainty of the Company’s ability to improve its financial results and profitability following emergence from bankruptcy and other risks and uncertainties related to the Company’s emergence from bankruptcy;
|
•
|
inability to maintain relationships with suppliers, customers, employees and other third parties following emergence from bankruptcy;
|
•
|
failure to satisfy the Company’s short- or long-term liquidity needs, including its inability to generate sufficient cash flow from operations or to obtain adequate financing to fund its capital expenditures and meet working capital needs following emergence from bankruptcy;
|
•
|
large or multiple customer defaults on contractual obligations, including defaults resulting from actual or potential insolvencies;
|
•
|
ability to comply with covenants under the Revolving Credit Facility;
|
•
|
effects of legal proceedings;
|
•
|
drilling locations;
|
•
|
oil, natural gas and NGL reserves;
|
•
|
realized oil, natural gas and NGL prices;
|
•
|
production volumes;
|
•
|
capital expenditures;
|
•
|
economic and competitive advantages;
|
•
|
credit and capital market conditions;
|
•
|
regulatory changes;
|
•
|
lease operating expenses, general and administrative expenses and development costs;
|
•
|
future operating results, including results of acquired properties;
|
•
|
plans, objectives, expectations and intentions; and
|
•
|
taxes.
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations - Continued
|
Item 3.
|
Quantitative and Qualitative Disclosures About Market Risk
|
Item 1.
|
Legal Proceedings
|
Item 1A.
|
Risk Factors
|
•
|
Roan may take actions contrary to our strategy or objectives;
|
•
|
we have limited ability to influence the day to day operations of Roan or its properties, including compliance with environmental, safety and other regulations; and
|
•
|
we are dependent on third parties for financial reporting matters upon which our financial statements are based.
|
Item 2.
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
Period
|
|
Total Number of Shares Purchased
|
|
Average Price Paid Per Share
|
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
|
|
Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs
(1)
|
||||||
|
|
|
|
|
|
|
|
(in thousands)
|
||||||
|
|
|
|
|
|
|
|
|
||||||
July 1 – 31
|
|
833,763
|
|
|
$
|
32.43
|
|
|
833,763
|
|
|
$
|
172,732
|
|
August 1 – 31
|
|
2,770,661
|
|
|
$
|
34.33
|
|
|
2,770,661
|
|
|
$
|
77,622
|
|
September 1 – 30
|
|
995,634
|
|
|
$
|
34.72
|
|
|
995,634
|
|
|
$
|
43,049
|
|
Total
|
|
4,600,058
|
|
|
$
|
34.07
|
|
|
4,600,058
|
|
|
|
(1)
|
On June 1, 2017, the Company’s Board of Directors announced that it had authorized the repurchase of up to $75 million of the Company’s outstanding shares of Class A common stock. On June 28, 2017, the Company’s Board of Directors announced that it had authorized an increase in the previously announced share repurchase program to up to a total of $200 million of the Company’s outstanding shares of Class A common stock. On October 4, 2017, the Company’s Board of Directors announced that it had authorized an additional increase in the previously announced share repurchase program to up to a total of $400 million of the Company’s outstanding shares of a Class A common stock.
|
Item 3.
|
Defaults Upon Senior Securities
|
Item 4.
|
Mine Safety Disclosures
|
Item 5.
|
Other Information
|
Exhibit Number
|
|
Description
|
|
|
|
|
|
2.1
|
—
|
First Amendment, dated July 10, 2017, to Purchase and Sale Agreement, dated June 1, 2017, by and between Linn Energy Holdings, LLC, Linn Operating, LLC, Linn Midstream, LLC and Bridge Energy LLC (incorporated by reference to Exhibit 2.6 to Quarterly Report on Form 10‑Q filed on August 3, 2017)
|
|
2.2
|
—
|
Purchase and Sale Agreement, dated October 3, 2017, by and between Linn Energy Holdings, LLC, Linn Operating, LLC and Washakie Exaro Opportunities, LLC (incorporated by reference to Exhibit 2.1 to Current Report on Form 8-K filed on October 5, 2017)
|
|
3.1
|
—
|
Amended and Restated Certificate of Incorporation of Linn Energy, Inc. (incorporated by reference to Exhibit 3.1 to Registration Statement on Form S-8 filed on February 28, 2017)
|
|
3.2
|
—
|
Bylaws of Linn Energy, Inc. (incorporated by reference to Exhibit 3.2 to Registration Statement on Form S-8 filed on February 28, 2017)
|
|
10.1
|
—
|
Credit Agreement, dated as of August 4, 2017, among Linn Energy Holdco II LLC, as borrower, Linn Energy Holdco LLC, as parent, Linn Energy, Inc. as holdings, Royal Bank of Canada, as administrative agent, Citibank, N.A., as syndication agent, Barclays Bank PLC, JPMorgan Chase Bank, N.A., Morgan Stanley Senior Funding, Inc. and PNC Bank National Association, as co-documentation agents, and the lenders party thereto (incorporated by reference to Exhibit 10.26 to Registration Statement on Form S-1/A filed on September 26, 2017)
|
|
—
|
|||
10.3
|
—
|
Amended and Restated Limited Liability Company Agreement of Roan Resources LLC, dated as of August 31, 2017 (incorporated by reference to Exhibit 10.1 to Current Report on Form 8‑K filed on September 7, 2017)
|
|
—
|
|||
—
|
|||
—
|
|||
—
|
|||
101.INS**
|
—
|
XBRL Instance Document
|
|
101.SCH**
|
—
|
XBRL Taxonomy Extension Schema Document
|
|
101.CAL**
|
—
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
101.DEF**
|
—
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
101.LAB**
|
—
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
101.PRE**
|
—
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
*
|
Filed herewith.
|
**
|
Furnished herewith.
|
|
LINN ENERGY, INC.
|
|
(Registrant)
|
|
|
Date: November 14, 2017
|
/s/ Darren R. Schluter
|
|
Darren R. Schluter
|
|
Vice President and Controller
|
|
(Duly Authorized Officer and Principal Accounting Officer)
|
|
|
|
|
Date: November 14, 2017
|
/s/ David B. Rottino
|
|
David B. Rottino
|
|
Executive Vice President and Chief Financial Officer
|
|
(Principal Financial Officer)
|
BORROWER:
|
LINN ENERGY HOLDCO II LLC
|
|
|
|
|
|
|
|
|
By:
|
/s/ David B. Rottino
|
|
Name:
|
David B. Rottino
|
|
Title:
|
Executive Vice President and Chief Financial Officer
|
|
|
|
PARENT:
|
LINN ENERGY HOLDCO LLC
|
|
|
|
|
|
|
|
|
By:
|
/s/ David B. Rottino
|
|
Name:
|
David B. Rottino
|
|
Title:
|
Executive Vice President and Chief Financial Officer
|
|
|
|
HOLDINGS:
|
LINN ENERGY, INC.
|
|
|
|
|
|
|
|
|
By:
|
/s/ David B. Rottino
|
|
Name:
|
David B. Rottino
|
|
Title:
|
Executive Vice President and Chief Financial Officer
|
|
|
|
GUARANTORS:
|
LINN ENERGY HOLDINGS, LLC
|
|
|
|
|
|
|
|
|
By:
|
/s/ David B. Rottino
|
|
Name:
|
David B. Rottino
|
|
Title:
|
Executive Vice President and Chief Financial Officer
|
|
|
|
|
LINN OPERATING, LLC
|
|
|
|
|
|
|
|
|
By:
|
/s/ David B. Rottino
|
|
Name:
|
David B. Rottino
|
|
Title:
|
Executive Vice President and Chief Financial Officer
|
|
|
|
|
LINN MIDWEST ENERGY LLC
|
|
|
|
|
|
|
|
|
By:
|
/s/ David B. Rottino
|
|
Name:
|
David B. Rottino
|
|
Title:
|
Executive Vice President and Chief Financial Officer
|
|
|
|
|
BLUE MOUNTAIN MIDSTREAM LLC
|
|
|
|
|
|
|
|
|
By:
|
/s/ David B. Rottino
|
|
Name:
|
David B. Rottino
|
|
Title:
|
Executive Vice President and Chief Financial Officer
|
|
|
|
|
LINN MARKETING, LLC
|
|
|
|
|
|
|
|
|
By:
|
/s/ David B. Rottino
|
|
Name:
|
David B. Rottino
|
|
Title:
|
Executive Vice President and Chief Financial Officer
|
|
|
|
ADMINISTRATIVE AGENT
:
|
ROYAL BANK OF CANADA
, as Administrative Agent
|
|
|
|
|
|
|
|
|
By:
|
/s/ Rodica Dutka
|
|
Name:
|
Rodica Dutka
|
|
Title:
|
Manager, Agency Services Group
|
ISSUING BANK AND LENDER
:
|
ROYAL BANK OF CANADA
, as Issuing Bank and a Lender
|
|
|
|
|
|
|
|
|
By:
|
/s/ Emilee Scott
|
|
Name:
|
Emilee Scott
|
|
Title:
|
Authorized Signatory
|
LENDERS
:
|
CITIBANK, N.A.
, as a Lender
|
|
|
|
|
|
|
|
|
By:
|
/s/ Saqeeb Ludhi
|
|
Name:
|
Saqeeb Ludhi
|
|
Title:
|
Senior Vice President
|
|
BARCLAYS BANK PLC
, as a Lender
|
|
|
|
|
|
|
|
|
By:
|
/s/ Christopher M. Aitkin
|
|
Name:
|
Christopher M. Aitkin
|
|
Title:
|
Assistant Vice President
|
|
JPMORGAN CHASE BANK, N.A.
, as a Lender
|
|
|
|
|
|
|
|
|
By:
|
/s/ Anson Williams
|
|
Name:
|
Anson Williams
|
|
Title:
|
Authorized Signatory
|
|
MORGAN STANLEY BANK, N.A.
, as a Lender
|
|
|
|
|
|
|
|
|
By:
|
/s/ Pat Layton
|
|
Name:
|
Pat Layton
|
|
Title:
|
Authorized Signatory
|
|
PNC BANK NATIONAL ASSOCIATION
, as a Lender
|
|
|
|
|
|
|
|
|
By:
|
/s/ Denise S. Davis
|
|
Name:
|
Denise S. Davis
|
|
Title:
|
Vice President
|
|
ABN AMRO CAPITAL USA LLC
, as a Lender
|
|
|
|
|
|
|
|
|
By:
|
/s/ Darrell Holley
|
|
Name:
|
Darrell Holley
|
|
Title:
|
Managing Director
|
|
|
|
|
|
|
|
By:
|
/s/ Elizabeth Johnson
|
|
Name:
|
Elizabeth Johnson
|
|
Title:
|
Director
|
|
CADENCE BANK, N.A.
, as a Lender
|
|
|
|
|
|
|
|
|
By:
|
/s/ Anthony Blanco
|
|
Name:
|
Anthony Blanco
|
|
Title:
|
Senior Vice President
|
|
CAPITAL ONE, NATIONAL ASSOCIATION
, as a Lender
|
|
|
|
|
|
|
|
|
By:
|
/s/ Mason McGurrin
|
|
Name:
|
Mason McGurrin
|
|
Title:
|
Managing Director
|
|
CATHAY BANK
, as a Lender
|
|
|
|
|
|
|
|
|
By:
|
/s/ Stephen V. Bacala II
|
|
Name:
|
Stephen V. Bacala II
|
|
Title:
|
Vice President
|
|
CANADIAN IMPERIAL BANK OF COMMERCE, NEW YORK BRANCH
, as a Lender
|
|
|
|
|
|
|
|
|
By:
|
/s/ Richard Antl
|
|
Name:
|
Richard Antl
|
|
Title:
|
Authorized Signatory
|
|
|
|
|
|
|
|
By:
|
/s/ William M. Reid
|
|
Name:
|
William M. Reid
|
|
Title:
|
Authorized Signatory
|
|
COMERICA BANK
, as a Lender
|
|
|
|
|
|
|
|
|
By:
|
/s/ William B. Robinson
|
|
Name:
|
William B. Robinson
|
|
Title:
|
Senior Vice President
|
|
DEUTSCHE BANK AG NEW YORK BRANCH
, as a Lender
|
|
|
|
|
|
|
|
|
By:
|
/s/ Marcus Tarkington
|
|
Name:
|
Marcus Tarkington
|
|
Title:
|
Director
|
|
|
|
|
|
|
|
By:
|
/s/ Anca Trifan
|
|
Name:
|
Anca Trifan
|
|
Title:
|
Managing Director
|
|
DNB CAPITAL LLC
, as a Lender
|
|
|
|
|
|
|
|
|
By:
|
/s/ Byron Cooley
|
|
Name:
|
Byron Cooley
|
|
Title:
|
Senior Vice President
|
|
|
|
|
|
|
|
By:
|
/s/ James Grubb
|
|
Name:
|
James Grubb
|
|
Title:
|
Vice President
|
|
FIFTH THIRD BANK
, as a Lender
|
|
|
|
|
|
|
|
|
By:
|
/s/ Justin Bellamy
|
|
Name:
|
Justin Bellamy
|
|
Title:
|
Director
|
|
KEYBANK NATIONAL ASSOCIATION
, as a Lender
|
|
|
|
|
|
|
|
|
By:
|
/s/ George E. McKean
|
|
Name:
|
George E. McKean
|
|
Title:
|
Senior Vice President
|
|
SOCIETE GENERALE
, as a Lender
|
|
|
|
|
|
|
|
|
By:
|
/s/ Max Sonnonstine
|
|
Name:
|
Max Sonnonstine
|
|
Title:
|
Director
|
|
SUNTRUST BANK
, as a Lender
|
|
|
|
|
|
|
|
|
By:
|
/s/ Benjamin L. Brown
|
|
Name:
|
Benjamin L. Brown
|
|
Title:
|
Director
|
|
BP ENERGY COMPANY
, as a Lender
|
|
|
|
|
|
|
|
|
By:
|
/s/ Timothy Yee
|
|
Name:
|
Timothy Yee
|
|
Title:
|
Attorney-in-Fact
|
|
CARGILL, INCORPORATED
, as a Lender
|
|
|
|
|
|
|
|
|
By:
|
/s/ Tyler R. Smith
|
|
Name:
|
Tyler R. Smith
|
|
Title:
|
Authorized Signer
|
|
MACQUARIE BANK LIMITED
, as a Lender
|
|
|
|
|
|
|
|
|
By:
|
/s/ Philip Yates
|
|
Name:
|
Philip Yates
|
|
Title:
|
Division Director
|
|
|
|
|
|
|
|
By:
|
/s/ Andrew Mitchell
|
|
Name:
|
Andrew Mitchell
|
|
Title:
|
Division Director
|
|
NEXTERA ENERGY MARKETING, LLC
, as a Lender
|
|
|
|
|
|
|
|
|
By:
|
/s/ Craig Shapiro
|
|
Name:
|
Craig Shapiro
|
|
Title:
|
Vice President and Managing Director
|
Bank Name
|
Legal Name
|
Account No.
|
Type of Account
|
Comerica Bank
|
Linn Operating, LLC
|
XXXX7057
|
Payroll
|
Comerica Bank
|
Linn Operating, LLC
|
XXXX1880
|
Trust Account for Environmental Protection Agency
|
Wells Fargo
|
Linn Energy, Inc.
|
XXXX4136
|
Trust Account
|
First Interstate Bank
|
Linn Operating, LLC
|
XXXX8532
|
State of Wyoming Suspense Account
|
Citi Bank
|
Linn Operating, LLC
|
XXXX0324
|
Employee Benefits
|
Comerica Bank
|
Linn Operating, LLC
|
XXXX2789
|
State of California Dept. Fish & Wildlife Standby Trust Account
|
Amegy Bank of Texas
|
Linn Energy, LLC
|
XXXX9639
|
General Unsecured Claims Account
|
Amegy Bank of Texas
|
Linn Energy, LLC
|
XXXX8078
|
General Unsecured (Convenience) Claims Account
|
Citi Bank
|
Linn Energy, Inc.
|
XXXX7473
|
Investment account - stock repurchases
|
Comerica Bank
|
Linn Operating, LLC
|
XXXX6151
|
Sweep Account
|
/s/ Mark E. Ellis
|
|
Mark E. Ellis
|
|
President and Chief Executive Officer
|
|
/s/ David B. Rottino
|
|
David B. Rottino
|
|
Executive Vice President and Chief Financial Officer
|
|
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date: November 14, 2017
|
/s/ Mark E. Ellis
|
|
Mark E. Ellis
|
|
President and Chief Executive Officer
|
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date: November 14, 2017
|
/s/ David B. Rottino
|
|
David B. Rottino
|
|
Executive Vice President and Chief Financial Officer
|