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0001600470
0001600470
2020-06-01
2020-06-01
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): June 1, 2020
Montage Resources Corporation
(Exact name of Registrant as Specified in Its Charter)
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Delaware
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001-36511
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46-4812998
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(State or Other Jurisdiction
of Incorporation)
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(Commission File Number)
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(IRS Employer
Identification No.)
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122 West John Carpenter Freeway, Suite 300
Irving, Texas
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75039
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(Address of Principal Executive Offices)
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(Zip Code)
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Registrant’s Telephone Number, Including Area Code: (469) 444-1647
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions A.2. below):
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Securities registered pursuant to Section 12(b) of the Act:
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Title of each class
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Trading
Symbol(s)
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Name of each exchange on which registered
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Common Stock, Par Value $0.01 Per Share
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MR
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New York Stock Exchange
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 5.02.Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Effective June 1, 2020, Montage Resources Corporation (the “Company”) appointed Matthew Rucker as Executive Vice President and Chief Operating Officer of the Company. Mr. Rucker replaces Oleg Tolmachev, the Company’s former Executive Vice President and Chief Operating Officer. Mr. Tolmachev’s employment with the Company was terminated effective June 1, 2020.
Mr. Rucker, age 34, previously served as the Company’s Executive Vice President, Resource Planning and Development, since the consummation of the Company’s business combination transaction with Blue Ridge Mountain Resources, Inc. (“Blue Ridge”) in February 2019. He served as Vice President, Resource Planning and Development of Blue Ridge since November 2016. Prior to joining Blue Ridge, Mr. Rucker served as a Production Superintendent for Chesapeake Energy Corporation (“Chesapeake”) from January 2014 to October 2016, overseeing Chesapeake’s Utica Shale production. As a member of Chesapeake’s Eastern Division leadership team, Mr. Rucker focused on the safe and efficient optimization of production in the Utica Shale and led an operating team of over 45 employees. During his service at Chesapeake, Mr. Rucker held several engineering positions in the Marcellus and Utica Shale Asset Teams within reservoir, primarily focused on strategic joint ventures, divestitures, acquisitions and resource development planning. Mr. Rucker graduated with a Bachelor of Science degree in Petroleum Engineering from Marietta College in 2007, where he continues to serve as Chair of the Marietta College Industry Advisory Council. He is a member of the Society of Petroleum Engineers.
Effective March 1, 2019, the Company and Mr. Rucker entered into an Executive Employment Agreement in connection with his promotion to the position of Executive Vice President, Resource Planning and Development. Effective June 1, 2020, the Company and Mr. Rucker entered into an amendment to the Executive Employment Agreement (the “Amendment”) solely to reflect his appointment as the Company’s Executive Vice President and Chief Operating Officer. A copy of the Amendment is filed as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference.
There are no other arrangements or understandings between Mr. Rucker and any other person pursuant to which Mr. Rucker was appointed as Executive Vice President and Chief Operating Officer of the Company. There are also no family relationships between Mr. Rucker and any director or executive officer of the Company, and Mr. Rucker has no direct or indirect material interest in any transaction required to be disclosed pursuant to Item 404(a) of Regulation S-K.
Item 7.01 Regulation FD Disclosure.
On June 2, 2020, the Company issued a press release, a copy of which is attached hereto as Exhibit 99.1, announcing, among other things, an increase in the Company’s second quarter and full year 2020 production guidance and the appointment of Mr. Rucker as the Company’s Executive Vice President and Chief Operating Officer.
In accordance with General Instruction B.2. of Form 8-K, the information in this Item 7.01, including Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to liabilities of that section, and is not incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act unless specifically identified therein as being incorporated therein by reference.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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MONTAGE RESOURCES CORPORATION
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Date: June 2, 2020
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By:
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/s/ Paul M. Johnston
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Name:
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Paul M. Johnston
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Title:
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Executive Vice President, General Counsel and
Corporate Secretary
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Exhibit 10.1
AMENDMENT NO. 1 TO EXECUTIVE EMPLOYMENT AGREEMENT
This Amendment No. 1 to Executive Employment Agreement (this “Amendment”) is made and entered into effective as of June 1, 2020, by and between Montage Resources Corporation (the “Company”) and Matthew Rucker (“Executive”).
WHEREAS, the parties hereto entered into that certain Executive Employment Agreement, effective as of March 1, 2019 (the “Agreement”);
WHEREAS, effective as of June 1, 2020, Executive has been appointed as the Company’s Executive Vice President and Chief Operating Officer; and
WHEREAS, the parties hereto desire to amend the Agreement as set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
1.Section 1 of the Agreement is hereby amended by deleting the phrase “Executive Vice President, Resource Planning and Development” and replacing it with the phrase “Executive Vice President and Chief Operating Officer.”
2.Except as specifically set forth herein, the Agreement and all of its terms and conditions remain in full force and effect and the Agreement is hereby ratified and confirmed in all respects, except that on and after the effective date of this Amendment all references in the Agreement to “this Agreement,” “hereto,” “hereof,” “hereunder” or words of like import shall mean the Agreement as amended by this Amendment.
3.This Amendment may be executed in one or more counterparts, each of which will be deemed to be an original, but all of which together will constitute one and the same instrument.
4.This Amendment is entered into under, and governed for all purposes by, the laws of the State of Texas, without regard to conflicts of laws principles thereof. With respect to any claims, legal proceedings or litigation arising in connection with this Amendment, the parties hereto hereby consent to the exclusive jurisdiction, forum and venue of the state and federal courts, as applicable, located in Dallas County, Texas.
5.This Amendment shall be binding upon and inure to the benefit of and be enforceable by the respective successors and assigns of the parties hereto.
[Remainder of page intentionally left blank; signature page follows.]
IN WITNESS WHEREOF, the parties hereto have executed this Amendment effective as of the date first above written.
MONTAGE RESOURCES CORPORATION
By: /s/ John K. Reinhart
Name:John K. Reinhart
Title:President and Chief Executive Officer
EXECUTIVE
By:/s/ Matthew Rucker
Name:Matthew Rucker
Exhibit 99.1
Montage Resources Corporation Increases Second Quarter and Full Year 2020 Production Guidance
IRVING, TX - June 2, 2020- (BUSINESS WIRE) – Montage Resources Corporation (NYSE: MR) (the “Company” or “Montage Resources”) today announced an increase in its full year and second quarter 2020 production guidance along with an organizational update.
Updated Production Guidance:
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In connection with improving crude oil and NGL commodity prices, the Company began increasing its previously curtailed production during the month of May. As of June 1, 2020, the Company has returned substantially all its previously curtailed production to sales due to the significant improvement in cash margins
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Due to continued operational outperformance and the return of its previously curtailed production to sales sooner than anticipated, the Company is increasing its full year production guidance for 2020 to 565 – 585 MMcfe per day, an increase of approximately 2% over the midpoint of its previous full year 2020 production guidance of 555 – 575 MMcfe per day
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The Company now expects its second quarter 2020 production will average between 535 – 555 MMcfe per day
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Organizational Update:
Effective June 1, 2020, Matthew Rucker, who previously served as Executive Vice President, Resource Planning and Development, has been named Executive Vice President and Chief Operating Officer. Mr. Rucker replaces Oleg Tolmachev, the former Chief Operating Officer of the Company, whose employment with the Company ended June 1, 2020. In his new role, Mr. Rucker has assumed responsibility over the Company’s operations in the Ohio Utica and Marcellus Shales along with oversight of the Company’s drilling and completion operations. In addition, Mr. Rucker will continue to oversee the Company’s reservoir engineering, land and geology departments.
John Reinhart, President and CEO, commented on the Company’s increased production guidance and organizational update, “The Company has remained very responsive to the changing industry environment. Upon realizing an accelerated rebound in oil pricing and cash margins, the Company moved very quickly to return its previously curtailed condensate production back to sales. These actions continue to reflect the agility of the Company as well as management’s priorities of cash flow generation and balance sheet protection.
Matthew’s progression into the Chief Operating Officer role will benefit the Company greatly due to his extensive background in operations, reservoir, planning, land and other functions that contribute to our overall business strategy. He has been integral to the Company’s successful pro forma strategy implementation over the past year. We look forward to his continued positive impact on the business. We also want to thank Oleg for his contributions and wish him well in his future endeavors.”
About Montage Resources
Montage Resources is an exploration and production company with approximately 195,000 net effective core undeveloped acres currently focused on the Utica and Marcellus Shales of Southeast Ohio, West Virginia and North Central Pennsylvania. For more information, please visit the Company’s website at www.montageresources.com.
Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical fact, included in this press release, including statements regarding Montage Resources’ strategy, future operations, financial position, estimated
revenues and income/losses, projected costs and capital expenditures, prospects, and plans and objectives of management, are forward-looking statements. When used in this press release, the words “plan,” “endeavor,” “goal,” “will,” “would,” ”should,” “could,” “believe,” “anticipate,” “intend,” “estimate,” “expect,” ”efforts,” “continue,” “position,” “potential,” “committed,” “target, ”project” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. These forward-looking statements are based on Montage Resources’ current expectations and assumptions about future events and are based on currently available information as to the outcome and timing of future events. When considering forward-looking statements, you should keep in mind the risk factors and other cautionary statements described under the heading “Risk Factors” in Montage Resources’ Annual Report on Form 10-K for the fiscal year ended December 31, 2019 filed with the Securities and Exchange Commission on March 10, 2020 (the “2019 Annual Report”) and in Montage Resources’ other filings and reports with the Securities and Exchange Commission.
Forward-looking statements may include, but are not limited to, statements about business strategy; reserves; general economic conditions; financial strategy, liquidity and capital required for developing properties and timing related thereto; realized natural gas, NGLs and oil prices and the volatility of those prices; write-downs of natural gas and oil asset values due to declines in commodity prices; timing and amount of future production of natural gas, NGLs and oil; hedging strategy and results; future drilling plans; competition and government regulations, including those related to hydraulic fracturing; the anticipated benefits under commercial agreements; marketing of natural gas, NGLs and oil; leasehold and business acquisitions leasehold and business acquisitions and joint ventures; leasehold terms expiring before production can be established and costs to extend such terms the costs, terms and availability of gathering, processing, fractionation and other midstream services; the costs, terms and availability of downstream transportation services; credit markets; uncertainty regarding future operating results, including initial production rates and liquid yields in type curve areas; and plans, objectives, expectations and intentions contained in this press release that are not historical, including, without limitation, the guidance set forth herein.
Montage Resources cautions you that all these forward-looking statements are subject to risks and uncertainties, most of which are difficult to predict and many of which are beyond the Company’s control, incident to the exploration for and development, production, gathering and sale of natural gas, NGLs and oil. These risks include, but are not limited to, the severity and continued duration of the COVID-19 pandemic, related economic effects and the resulting negative impact on the demand for natural gas, NGLs and oil; operational challenges relating to the COVID-19 pandemic, including logistical challenges, protecting the health and well-being of the Company’s employees, remote work arrangements, performance of counterparty contracts and supply chain disruptions; legal and environmental risks; drilling and other operating risks; regulatory changes, including U.S. federal, state and local tax regulatory changes; commodity price volatility and declines in the price of natural gas, NGLs, and oil; inflation; lack of availability of drilling, production and processing equipment and services; counterparty credit risk; the uncertainty inherent in estimating natural gas, NGLs and oil reserves and in projecting future rates of production, cash flow and access to capital; risks associated with the Company’s level of indebtedness; the timing of development expenditures, and the other risks described under the heading “Risk Factors” in the 2019 Annual Report and in Montage Resources’ other filings and reports with the Securities and Exchange Commission.
All forward-looking statements, expressed or implied, included in this press release are expressly qualified in their entirety by this cautionary statement and are based on assumptions that Montage Resources believes to be reasonable but that may not prove to be accurate. This cautionary statement should also be considered in connection with any subsequent written or oral forward-looking statements that Montage Resources or persons acting on its behalf may issue. Except as otherwise required by applicable law, Montage Resources disclaims any duty to update any forward-looking statements to reflect new information or events or circumstances after the date of this press release. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof.
Contact:
Montage Resources Corporation
Douglas Kris, Investor Relations
469-444-1736
dkris@mresources.com