OKLAHOMA CITY, Dec. 23, 2013 (GLOBE NEWSWIRE) -- PostRock Energy Corporation (PSTR) today announced that on December 13, 2013, it issued 1,123,981 shares of PostRock common stock to White Deer Energy L.P., White Deer Energy TE L.P. and White Deer Energy FI L.P. ("White Deer") in exchange for warrants held by White Deer exercisable for 22,241,333 shares of common stock together with a like number of one one-hundredths of a share of Series B Voting Preferred Stock which were issued as a unit with the warrants. The warrants had exercise prices ranging from $2.80 to $6.39 per share, with a weighted average exercise price of $3.23 per share. The transaction reduces the outstanding warrants by approximately 55%. Following the exchange, White Deer owned 10,958,601 shares of common stock and warrants to purchase 17,704,904 shares of common stock with a weighted average exercise price of $1.58 per share. White Deer's fully diluted ownership after the exchange and assuming conversion of all other derivative securities outstanding is reduced from 69% to 57%, and White Deer's voting power is reduced from 64% to 51%.
The warrants were valued as of September 30, 2013 by a third-party appraisal firm. The number of shares issued was determined by dividing the total value of the warrants by $1.31, the closing price of the common stock on the NASDAQ Global Market on the same date. The transaction was reviewed and approved by the unaffiliated members of the board of directors of PostRock.
Commenting, Terry W. Carter, President and Chief Executive Officer of the Company, said: "This transaction is a step toward simplifying PostRock's balance sheet by substantially reducing the overhang of the warrants held by White Deer."
PostRock Energy Corporation is engaged in the acquisition, exploration, development and production of oil and natural gas, primarily in the Cherokee Basin of Kansas and Oklahoma. The Company owns and operates over 3,000 wells and nearly 2,200 miles of gas gathering lines in the Basin. It also owns and operates oil producing properties in central Oklahoma and minor oil and gas producing properties in the Appalachian Basin.
Opinions, forecasts, projections or statements, other than statements of historical fact, are forward-looking statements that involve risks and uncertainties. Forward-looking statements in this announcement are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct. Actual results may differ materially due to a variety of factors, some of which may not be foreseen by PostRock. These risks and other risks are detailed in the Company's filings with the Securities and Exchange Commission, including risk factors listed in the Company's Annual Report on Form 10-K and other filings with the SEC. The Company's filings with the SEC may be found at www.pstr.com or www.sec.gov. By making these forward-looking statements, the Company undertakes no obligation to update these statements for revisions or changes after the date of this release.
- Oil, Gas, & Consumable Fuels
David J. Klvac
EVP & Chief Financial Officer