Summary
This summary highlights selected information contained elsewhere in this prospectus supplement, the accompanying base prospectus and the documents we incorporate by reference herein and therein. It does not
contain all of the information you should consider before making an investment decision. You should read this entire prospectus supplement, the accompanying base prospectus, the documents incorporated by reference herein and therein and the other
documents to which we refer you for a more complete understanding of our business and this offering. Please read “Risk factors” beginning on page
S-6
of this prospectus supplement and the additional
information contained in our Annual Report on Form
10-K
for the year ended December 31, 2016 and our Quarterly Reports on Form
10-Q
for the quarters ended
March 31, 2017, June 30, 2017 and September 30, 2017, which are incorporated by reference in this prospectus supplement, for financial and other important information you should consider before making an investment decision. Unless
the context otherwise requires, the terms “we”, “us”, “our”, and the “company” refer to Bill Barrett Corporation and its wholly-owned subsidiaries.
Bill Barrett Corporation
Overview
We are an independent energy company that develops, acquires and explores for oil and natural gas resources. All of our assets are located in and all of our operations are conducted in the Rocky Mountain region of
the United States. We operate in one industry segment, which is the development and production of crude oil, natural gas and NGLs.
We seek to build
stockholder value by delivering profitable growth in cash flow, reserves and production through the development of oil and natural gas assets. In order to deliver profitable growth, we allocate capital to our highest return assets, concentrate
expenditures on exploiting our core assets, maintain capital discipline and optimize operations while upholding high-level standards for health, safety and the environment. Substantially all of our revenues are generated through the sale of oil and
natural gas production and NGL recovery at market prices.
Based on a report prepared by us and audited by Netherland, Sewell & Associates,
Inc., our independent petroleum engineers, our proved reserves at December 31, 2016 totaled 54.9 MMBoe, consisting of 57% crude oil, 23% natural gas and 20% NGLs. At December 31, 2016, 66% of our total proved reserves were classified as
proved developed and 34% were classified as proved undeveloped. As of the same date, 78% of our proved reserves were located in the Denver-Julesburg Basin (“DJ Basin”) and 22% were located in the Uinta Basin and other basins.
Our production during the nine months ended September 30, 2017 averaged 17,872 barrels of oil equivalent per day, with 88% of our production
originating from the DJ Basin. Our average daily production during the nine months ended September 30, 2017 was 60% crude oil, 21% natural gas and 19% NGLs.
Corporate information
Our common stock is traded on the NYSE under the symbol
“BBG”. We were formed in January 2002 and are incorporated in the State of Delaware. Our principal executive offices are located at 1099 18
th
Street, Suite 2300, Denver, Colorado 80202, our phone number is
303-293-9100,
and our website is www.billbarrettcorp.com. Information contained on or accessible through our website is not incorporated by reference into or otherwise a
part of this prospectus supplement or the accompanying base prospectus.
S-1
Recent developments
The Merger
On December 4, 2017, we entered into an Agreement and Plan of Merger (the “Merger
Agreement”) with Fifth Creek Operating Company, LLC (“Fifth Creek”), Red Rider Holdco, Inc., a wholly owned subsidiary of ours (“New Parent”), Rio Merger Sub, LLC, a direct wholly owned subsidiary of New Parent (“Rio
Grande Merger Sub”), Rider Merger Sub, Inc., a direct wholly owned subsidiary of New Parent (“Parent Merger Sub”), and, for limited purposes set forth in the Merger Agreement, Fifth Creek Energy Company, LLC (“Holdings”) and
NGP Natural Resources XI, L.P. (“NGP”). Pursuant to the terms of the Merger Agreement, at the closing of the mergers contemplated by the Merger Agreement (collectively, the “Merger”) (a) Parent Merger Sub will be merged with and
into the company, with the company surviving the Merger, and (b) Rio Grande Merger Sub will be merged with and into Fifth Creek, with Fifth Creek surviving the Merger, as a result of which the company and Fifth Creek will each become direct wholly
owned subsidiaries of New Parent.
As consideration to the company’s stockholders, each share of our common stock will be converted into the right
to receive one share of New Parent common stock and Holdings will receive 100 million shares of New Parent common stock, subject to the terms of the Stockholders Agreement to be entered into upon closing of the Merger by and among New Parent,
Holdings and, for limited purposes set forth in the Stockholders Agreement, NGP.
Fifth Creek is an exploration and production company focusing on the
development of oil and gas reserves from the DJ Basin. Fifth Creek’s properties include approximately 81,000 net acres in Weld County in the DJ Basin, substantially all of which are operated. The assets we will acquire in the Merger also
include 62 producing standard-length lateral wells and seven producing extended-reach lateral wells. Production from Fifth Creek’s properties in the third quarter of 2017 was approximately 2,900 Boe per day, of which approximately 72% was oil.
According to a report prepared by Netherland, Sewell & Associates, Inc., proved reserves associated with the properties were 113 MMboe as of December 31, 2016, of which 3% were proved developed. We estimate that there are approximately
1,179 gross horizontal drilling locations on the properties. As of September 30, 2017, Fifth Creek had approximately $14 million of indebtedness under its revolving credit facility. Under the Merger Agreement, Fifth Creek may incur up to a
total of $54 million in indebtedness prior to the closing of the Merger.
We believe the Merger will provide us with a number of benefits, including
the following:
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Significantly increased scale consistent with our strategic focus on the DJ Basin, including a combined position in excess of 151,100 net acres, current
production of approximately 24 MBoe per day and proved reserves of approximately 168 MMBoe as of December 31, 2016 (which includes estimated proved reserves of 12 MMBoe associated with the Uinta Basin properties we have agreed to sell).
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A substantial increase in our inventory of drilling locations with expected attractive well-level rates of return. Assuming completion of the Merger, we believe
that we will have over 2,800 gross undeveloped horizontal drilling locations with a weighted-average well-level internal rate of return of approximately 65%, assuming average drilling costs of $4.9 million per well and strip prices as of
November 24, 2017.
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•
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A strengthened balance sheet with modest leverage at closing and ample borrowing capacity under our revolving credit facility.
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Synergies resulting from cost reductions and optimization of operations over the complementary combined asset base in a predominantly rural area. We believe that
substantially all of the combined company’s drilling locations will be suitable for extended reach lateral well development.
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S-2
The closing of the transaction is subject to the receipt of any required regulatory approvals, the approval of
the company’s stockholders and the satisfaction of other customary closing conditions. Although there can be no assurance, we expect to close the Merger late in the first quarter or early in the second quarter of 2018. A copy of the Merger
Agreement is included as an exhibit to our Current Report on Form
8-K
filed with the SEC on December 5, 2017, which is incorporated by reference into this prospectus supplement. This offering is not
conditioned upon the completion of the Merger.
Uinta Basin sale
On November 20, 2017, we entered into an agreement to sell our remaining
non-core
assets located in the Uinta Basin for cash proceeds of approximately $110 million.
The transaction, which we refer to as the “Uinta Basin sale,” is expected to close on or before December 31, 2017 and is subject to customary closing conditions and purchase price adjustments. Total cash consideration at time of
closing is estimated at $103.0 million. The assets to be sold produced approximately 2,300 Boe per day (91% oil) during the third quarter of 2017 and had estimated proved reserves of 12 million barrels of oil equivalent (100% proved developed)
as of December 31, 2016.
Debt exchange and consent solicitation
On December 4, 2017, we entered into an agreement pursuant to which we will acquire $50 million aggregate principal amount of our 7.0% senior notes due 2022 for a number of shares based on the trading price of our
common stock over a
one-day
period plus cash in respect of accrued and unpaid interest (the “debt exchange”). Following the completion of the debt exchange, $350 million aggregate principal amount of
the 7.0% senior notes will remain outstanding. Closing of the transaction is expected to occur in December 2017.
Contemporaneously with this offering,
we expect to launch solicitations (the “consent solicitations”) pursuant to which we will seek consents from holders of our 7.0% senior notes and holders of our 8.75% senior notes due 2025 (collectively, the “Senior Notes”) to
amend each of the indentures governing the Senior Notes to, among other things, amend the defined term “Change of Control” in each of the indentures to provide that the Merger will not constitute a “Change of Control” under the
indentures. To become effective with respect to either series of Senior Notes, the proposed amendments must be approved by at least a majority of the holders of the then-outstanding aggregate principal amount of the Senior Notes governed by the
applicable indenture. We expect to pay a consent fee equal to $2.50 per $1,000 principal amount of Senior Notes for consents validly delivered and not validly revoked upon the execution and effectiveness of the applicable supplemental indenture
giving effect to the proposed amendments. Certain holders holding a majority of the outstanding aggregate principal amount of each series of Senior Notes have agreed to deliver consents in the consent solicitations with respect to all Senior Notes
they hold. Accordingly, we expect that upon delivery of such consents, the consents necessary to implement the proposed amendments will have been obtained. This prospectus supplement and the accompanying prospectus do not constitute a solicitation
of consents to amend the indentures. This offering, the debt exchange and the consent solicitations are not conditioned on one another.
Operational Outlook
For 2017 as a whole, we
currently expect (i) production of 6.9-7.1 MMBoe, (ii) our lease operating expenses to be between $24 and $25 million, and (iii) our cash general and administrative expenses to be between $32 and $33 million. We expect our capital expenditures
for the year to be between $250 million and $270 million.
S-3
The realization of our expectations is subject to numerous risks and uncertainties, including those described in
the “Risk Factors” section of this prospectus supplement and the documents incorporated by reference herein.
S-4
The offering
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Issuer
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Bill Barrett Corporation
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Common stock offered by us
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21,000,000 shares.
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Option to purchase additional shares
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The underwriters also have the option to purchase up to an additional 3,150,000 shares from us on the same terms and conditions within 30 days from the date of this prospectus supplement.
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Common stock outstanding following the offering(1)
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97,292,038 shares (100,442,038 shares if the underwriters exercise their option to purchase additional shares in full).
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Use of proceeds
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We estimate that our net proceeds from this offering, after deducting underwriting discounts and commissions and estimated fees and expenses, will be approximately $100.3 million ($115.3 million if the
underwriters exercise their over-allotment option to purchase 3,150,000 additional shares of our common stock in full).
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We intend to use the net proceeds from this offering for general corporate purposes, including to finance future capital expenditures. See “Use of proceeds.”
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Risk factors
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Investing in our common stock involves substantial risk. You should carefully consider the risk factors set forth or cross-referenced in the sections entitled “Risk factors” beginning on
page S-6
of this prospectus supplement and on page 3 of the accompanying prospectus, and the other information contained in this prospectus supplement and the accompanying prospectus and the documents
incorporated by reference herein and therein, prior to making an investment in our common stock.
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Trading symbol
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Our common stock is listed on the NYSE under the symbol “BBG”.
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(1)
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The number of shares of common stock to be outstanding immediately following this offering is based on 76,292,038 shares outstanding as of December 4, 2017. The number of shares
of our common stock outstanding as of that date does not include shares to be issued in the debt exchange or the merger.
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S-5
Risk factors
Any investment in our common stock involves a high degree of risk. You should carefully consider the risks described below, and all of the information contained or incorporated by reference into this prospectus
supplement before deciding whether to purchase our common stock. The risks and uncertainties described below and in such incorporated documents are not the only risks and uncertainties that we face. Additional risks and uncertainties not presently
known to us or that we currently deem immaterial may also impair our business operations. If any of these risks actually occurs, our business, financial condition or results of operations would suffer. In that case, the trading price of our common
stock could decline and you could lose all or part of your investment. The risks discussed below also include forward-looking statements, and our actual results may differ substantially from those discussed in these forward-looking statements. See
“Cautionary statement regarding forward-looking statements”.
Risks relating to the Merger
We may not consummate the Merger and the closing of this offering is not conditioned on its consummation.
The closing of this offering is not conditioned on the consummation of the Merger. There can be no assurances that the Merger will be consummated on the terms
described herein or at all, or that the consummation of the Merger will not be delayed beyond the expected closing date. If we do not complete the Merger, we will not have the opportunity to attempt to realize the benefits we believe the transaction
will afford us.
We have performed only a limited investigation of the properties subject to the Merger. The completion of the Merger is subject to
specified closing conditions and to the right of one or both of the parties to terminate the Merger Agreement in certain circumstances. Some of the conditions to closing the Merger are beyond our control, including the approval by our stockholders
of the Merger Agreement.
Because this offering is not conditioned on the consummation the Merger, if you decide to purchase shares of common stock in
this offering, you should be willing to do so whether or not we complete the Merger. If the Merger is delayed, not consummated or consummated in a manner different than described herein, the price of our common stock may decline.
Failure to complete the Merger could negatively impact our stock prices and future businesses and financial results.
If the Merger
is not completed, we will be subject to several risks, including the following:
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•
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certain damages for which we may be liable to Fifth Creek under the terms and conditions of the Merger
Agreement, including a termination
fee in certain circumstances;
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payment for certain costs relating to the Merger, whether or not the Merger is completed, such as legal, accounting, financial advisor and printing fees;
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negative reactions from the financial markets, including declines in the price of our stock due to the fact that current prices may reflect a market assumption
that the Merger
will be completed; and
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diverted attention of company management to the Merger rather than to our operations and pursuit of other opportunities that could have been beneficial to
us.
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S-6
Certain directors, board members and executive officers of the company may have interests in the transactions
contemplated by the Merger Agreement that are different from, or in addition to, those of our stockholders generally.
You should be aware that
certain directors and senior management of the Company may have interests in the transactions contemplated by the Merger Agreement that are different from, or in addition to, the interests of company stockholders generally. These interests may
include the continued employment of certain board members, senior management and executive officers and the indemnification of former company board members, senior management and executive officers.
We will be subject to various uncertainties and contractual restrictions while the Merger is pending that could adversely affect our business and operations.
Uncertainty about the effect of the Merger on customers, suppliers and vendors may have an adverse effect on our business, financial condition
and results of operations. It is possible that some customers, suppliers and other persons with whom we have business relationships may delay or defer certain business decisions, or might decide to seek to terminate, change or renegotiate their
relationship with us as a result of the Merger, which could negatively affect our financial results, as well as the market price of our stock, regardless of whether the Merger is completed.
Additionally, under the terms of the Merger Agreement, the company is subject to certain restrictions on the conduct of its business prior to completing the Merger, which may adversely affect its ability to execute
certain of its business strategies. These restrictions may, among other matters, prevent the company from pursuing otherwise attractive business opportunities, selling assets, incurring indebtedness, engaging in significant capital expenditures in
excess of certain limits set forth in the Merger Agreement, entering into other transactions or making other changes to our business prior to consummation of the Merger or termination of the Merger Agreement. Such limitations could negatively affect
our businesses and operations prior to the completion of the Merger.
We may have difficulty attracting, motivating and retaining executives and
other employees in light of the Merger.
Uncertainty about the effect of the Merger on our employees may impair our ability to attract, retain
and motivate personnel until the Merger is completed. Employee retention may be particularly challenging during the pendency of the Merger, as employees may feel uncertain about their future roles with the combined organization. In addition, we may
have to provide additional compensation in order to retain employees. If employees depart because of issues relating to the uncertainty and difficulty of integration or a desire not to become employees of the combined company, the combined
company’s ability to realize the anticipated benefits of the Merger could be adversely affected.
The provisions of the Merger Agreement
limiting our ability to pursue alternative transactions to the Merger and requiring us to pay a termination fee if we do so may discourage others from trying to acquire us.
The Merger Agreement prohibits the company and its directors, officers, employees, advisors and other representatives, subject to specified exceptions, from initiating, encouraging, soliciting or entering into
discussions with any third party regarding alternative acquisition proposals. This prohibition limits our ability to pursue offers from other possible acquirers that may be superior from a financial point of view. If we receive an unsolicited
proposal from a third party that is superior from a financial point of view to that made by Fifth Creek and the Merger Agreement is terminated, we would be required to pay a termination fee to Fifth Creek.
These provisions could discourage a potential third-party acquirer that might have an interest in acquiring all or a significant portion of our stock or assets from
considering or proposing that acquisition, even if it were
S-7
prepared to pay consideration with a higher per share cash or market value than the market value proposed to be received or realized in the Merger. Similarly, these provisions might result in a
potential third-party acquirer proposing to pay a lower price to our stockholders than it might otherwise have proposed to pay because of the added expense of the termination fee that may become payable in certain circumstances. If the Merger
Agreement is terminated and we determine to seek another business combination, we may not be able to negotiate a transaction with another party on terms comparable to, or better than, the terms of the Merger.
If completed, the Merger may not achieve its expected benefits and may result in us assuming unanticipated liabilities.
We entered into the Merger Agreement with the expectation that the Merger would result in various benefits, growth opportunities and synergies. Achieving the
anticipated benefits of the transaction is subject to a number of risks and uncertainties. We would assume all of the liabilities associated with the acquired properties and environmental, title and other problems could reduce the value of the
properties to us. Also, it is uncertain whether our existing operations and the acquired properties and assets can be integrated in an efficient and effective manner.
As with other acquisitions, the success of the Merger depends on, among other things, the accuracy of our assessment of the reserves and drilling locations associated with the acquired properties, future oil, NGLs
and natural gas prices and operating costs and various other factors. These assessments are necessarily inexact. Although the properties to be acquired are subject to many of the risks and uncertainties to which our business and operations are
subject, risks associated with the Merger in particular include those associated with the significant size of the transaction relative to our existing operations and the fact that a substantial majority of the properties to be acquired are
undeveloped.
In addition, the integration of operations following the Merger will require the attention of our management and other personnel, which may
distract their attention from our
day-to-day
business and operations and prevent us from realizing benefits from other opportunities. Completing the integration process
may be more expensive than anticipated, and we cannot assure you that we will be able to effect the integration of these operations smoothly or efficiently or that the anticipated benefits of the transaction will be achieved.
The reserves, production, drilling locations and rate of return estimates with respect to the properties to be acquired in the Merger may differ materially
from the actual amounts.
The reserves, production, drilling locations and rate of return estimates with respect to the properties to be acquired
in the Merger are based on an analysis of historical production data, assumptions regarding capital expenditures, anticipated production and estimates of viable drilling locations. We cannot assure you that these estimates are accurate. The actual
reserves, production, number of drilling locations and rates of return from wells may differ materially from the amounts indicated in this prospectus supplement.
NGP will have the ability to exercise significant influence over certain corporate actions following completion of the Merger.
Following the Merger, NGP and/or its affiliates will collectively own a substantial amount of our outstanding common stock (not taking into account shares to be issued in this offering or the debt exchange). If NGP
were in the future to sell all or a material number of shares of common stock, the market price of our common stock could be negatively impacted. Additionally, as a significant stockholder, NGP could influence or control to some degree the outcome
of matters requiring a stockholder vote, including the election of directors, the adoption of any amendment to our certificate of incorporation or bylaws and the approval of mergers and other significant corporate transactions. Their influence or
control over us may have the effect of delaying or preventing a change of control or may adversely affect the voting and other rights of other stockholders.
S-8
Risks relating to the offering and our common stock
The market price of our common stock may be volatile and our stock price could decline.
The trading
price of shares of our common stock has from time to time fluctuated widely and in the future may be subject to similar fluctuations. The trading price of our common stock may be affected by a number of factors, including the volatility of oil and
natural gas prices, our operating results, changes in our earnings estimates, additions or departures of key personnel, our financial condition and the success of our drilling activities, legislative and regulatory changes, conditions in the oil and
natural gas industry, general economic conditions, and conditions in the securities markets. More generally, a significant or extended decline in commodity prices, regardless of the cause, could have a material adverse effect on the price of our
common stock.
Because we have no plans to pay, and are currently restricted from paying, dividends on our common stock, investors must look solely
to appreciation in the value of our common stock for a return on their investment in us.
We do not anticipate paying dividends on our common
stock in the foreseeable future. We currently intend to retain all future earnings to fund the development and growth of our business. Any payment of future dividends will be at the discretion of our board of directors. In addition, covenants
contained in our revolving credit facility and the indentures governing our senior notes restrict the payment of dividends. Investors must rely on sales of their common stock after price appreciation, which may never occur, as the only way to
realize a return on their investment. Investors seeking cash dividends should not purchase our common stock.
We are able to issue shares of
preferred stock with greater rights than our common stock.
Our board of directors is authorized to issue one or more series of preferred stock
from time to time without any action on the part of our stockholders. Our board of directors also has the power, without stockholder approval, to set the terms of any such series of preferred stock that may be issued, including voting rights,
dividend rights and preferences over our common stock with respect to dividends and other terms. If we issue preferred stock in the future that has a preference over our common stock with respect to the payment of dividends or other terms, or if we
issue preferred stock with voting rights that dilute the voting power of our common stock, the rights of holders of our common stock or the market price of our common stock could be adversely affected.
Sales of a significant number of shares of our common stock in the public markets, or the perception that such sales could occur, could depress the market
price of our common stock.
Sales of a substantial number of shares of our common stock, including common stock issued in the Merger, could
depress the market price of our common stock and impair our ability to raise capital through the sale of additional equity securities. We, our directors and our executive officers have agreed not to dispose of or hedge any common stock or securities
convertible into, or exchangeable for, shares of common stock during the period from the date of this prospectus supplement continuing through the date 45 days after the date of this prospectus supplement, subject to certain exceptions. The
underwriters may release the restrictions on any such shares at any time without notice. We cannot predict the effect that future sales of our common stock or perceptions of such sales following the expiration of the
45-day
period referred to above would have on the market price of our common stock.
Investors in this
offering may experience future dilution.
In order to raise additional capital, effect acquisitions, or for other purposes, we may in the future
offer additional shares of our common stock or other securities convertible into, or exchangeable for, our common
S-9
stock at prices that may not be the same as the price per share of this offering. We have an effective shelf registration statement from which additional shares of common stock and other
securities can be offered. We cannot assure you that we will be able to sell shares or other securities in any other offering at a price per share that is equal to or greater than the price per share paid by investors in this offering. If the price
per share at which we sell additional shares of our common stock in future transactions is less than the price per share in this offering, investors who purchase our common stock in this offering will suffer a dilution of their investment.
Changes in tax laws, including as a result of any U.S. tax reform legislation, could eliminate certain federal income tax deductions currently
available with respect to crude oil and natural gas exploration and development and/or with respect to payments of interest on our indebtedness, and could have other adverse effects on our tax liabilities and positions.
We are subject to changing and extensive tax laws, the effects of which cannot be predicted. Among other potential changes, tax reform legislation has recently
been proposed and passed in both houses of Congress that, if enacted into law, would make significant changes to U.S. federal tax laws. Any such tax reform legislation may change the taxation of business in many industries, including crude oil
and natural gas exploration and production companies. For example, under currently proposed versions of U.S. tax reform legislation, our ability to deduct interest may be significantly limited. Moreover, in past years, legislation has been
proposed in the Congress that would eliminate certain key federal income tax incentives currently available to crude oil and natural gas exploration and production companies. These changes have included, but are not limited to, (i) the repeal
of the percentage depletion allowance for oil, natural gas and NGL properties, (ii) the elimination of current deductions for intangible drilling and development costs, (iii) the elimination of the deduction for certain U.S. production
activities, and (iv) an extension of the amortization period for certain geological and geophysical expenditures. Congress could consider, and could include, some or all of these proposals as part of tax reform legislation or other legislation.
It is unclear whether these or other changes will be enacted and, if enacted, how soon any such changes could take effect. The enactment of any
legislation as a result of these proposals or any similar changes in U.S. federal income or other tax laws could defer or eliminate certain tax deductions that are currently available to us, and any such change could materially and adversely affect
our business, results of operation and financial condition.
S-10
Use of proceeds
We estimate that our net proceeds from this offering, after deducting underwriting discounts and commissions and estimated fees and expenses, will be approximately $100.3 million ($115.3 million if the
underwriters exercise their over-allotment option to purchase 3,150,000 additional shares of our common stock in full).
We intend to use the net
proceeds from this offering for general corporate purposes, including to finance future capital expenditures. Pending such use of the proceeds, we intend to invest the proceeds of this offering in highly liquid cash equivalents or United States
government securities.
The foregoing represents our intentions based upon our present plans and business conditions. The occurrence of unforeseen events
or changed business conditions, however, could result in the application of the net proceeds from this offering in a manner other than as described in this prospectus supplement.
S-11
Underwriting
We are offering the shares of common stock described in this prospectus through a number of underwriters. J.P. Morgan Securities LLC is acting as sole
book-running
manager of
the offering and as representative of the underwriters. We have entered into an underwriting agreement with the underwriters. Subject to the terms and conditions of the underwriting agreement, we have agreed to sell to the underwriters, and each
underwriter has severally agreed to purchase, at the public offering price less the underwriting discounts and commissions set forth on the cover page of this prospectus, the number of shares of common stock listed next to its name in the following
table:
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Name
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Number of shares
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J.P. Morgan Securities LLC
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14,700,000
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BMO Capital Markets Corp.
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1,050,000
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Citigroup Global Markets Inc.
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1,050,000
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Deutsche Bank Securities Inc.
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1,050,000
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Merrill Lynch, Pierce, Fenner & Smith
Incorporated
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1,050,000
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Scotia Capital (USA) Inc.
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1,050,000
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Wells Fargo Securities, LLC
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1,050,000
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Total
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21,000,000
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The underwriters are committed to purchase all the common shares offered by us if they purchase any shares. The underwriting
agreement also provides that if an underwriter defaults, the purchase commitments of
non-defaulting
underwriters may also be increased or the offering may be terminated.
The underwriters propose to offer the common shares directly to the public at the initial public offering price set forth on the cover page of this prospectus and
to certain dealers at that price less a concession not in excess of $0.1275 per share. Any such dealers may resell shares to certain other brokers or dealers at a discount of up to $.0425 per share from the initial public offering price. After the
initial offering of the shares to the public, the offering price and other selling terms may be changed by the underwriters.
The underwriters have an
option to buy up to 3,150,000 additional shares of common stock from us to cover over-allotments, if any. The underwriters have 30 days from the date of this prospectus to exercise this option to purchase additional shares. If any shares are
purchased with this option to purchase additional shares, the underwriters will purchase shares in approximately the same proportion as shown in the table above. If any additional shares of common stock are purchased, the underwriters will offer the
additional shares on the same terms as those on which the shares are being offered.
The underwriting fee is equal to the public offering price per share
of common stock less the amount paid by the underwriters to us per share of common stock. The underwriting fee is $0.2125 per share. The following table shows the per share and total underwriting discounts and commissions to be paid to the
underwriters assuming both no exercise and full exercise of the underwriters’ option to purchase additional shares.
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Without option to
purchase
additional
shares
exercise
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With full option
to
purchase
additional
shares exercise
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Per Share
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$
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0.2125
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$
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0.2125
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Total
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$
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4,462,500
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$
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5,131,875
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S-19
We estimate that the total expenses of this offering, including registration, filing and listing fees, printing fees
and legal and accounting expenses, but excluding the underwriting discounts and commissions, will be approximately $300,000. A prospectus in electronic format may be made available on the web sites maintained by one or more underwriters, or selling
group members, if any, participating in the offering. The underwriters may agree to allocate a number of shares to underwriters and selling group members for sale to their online brokerage account holders. Internet distributions will be allocated by
the representative to underwriters and selling group members that may make Internet distributions on the same basis as other allocations.
We
have agreed that, subject to certain exceptions, we will not (i) offer, pledge, sell, contract to sell, sell any option or contract
to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase or otherwise dispose of, directly or indirectly, or file with the Securities and Exchange Commission a registration statement under the Securities
Act relating to, any shares of our common stock or securities convertible into or exchangeable or exercisable for any shares of our common stock, or publicly disclose the intention to make any offer, sale, pledge, disposition or filing, or
(ii) enter into any swap or other arrangement that transfers all or a portion of the economic consequences associated with the ownership of any shares of common stock or any such other securities (regardless of whether any of these transactions
are to be settled by the delivery of shares of common stock or such other securities, in cash or otherwise), in each case without the prior written consent of J.P. Morgan Securities LLC for a period of 45 days after the date of this prospectus,
other than the shares of our common stock to be sold hereunder.
Our directors and executive officers have entered into
lock-up
agreements with the underwriters prior to the commencement of this offering pursuant to which each of these persons or entities, with limited exceptions, for a period of 45 days after the date of this
prospectus, may not, without the prior written consent of J.P. Morgan Securities LLC, (1) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or
warrant to purchase, or otherwise transfer or dispose of, directly or indirectly, any shares of our common stock or any securities convertible into or exercisable or exchangeable for our common stock (including, without limitation, common stock or
such other securities which may be deemed to be beneficially owned by such directors, executive officers, managers and members in accordance with the rules and regulations of the SEC and securities which may be issued upon exercise of a stock option
or warrant), or publicly disclose the intention to make any offer, sale, pledge, or disposition or (2) enter into any swap or other agreement that transfers, in whole or in part, any of the economic consequences of ownership of the common stock
or such other securities, whether any such transaction described in clause (1) or (2) above is to be settled by delivery of common stock or such other securities, in cash or otherwise, or (3) make any demand for or exercise any right
with respect to the registration of any shares of our common stock or any security convertible into or exercisable or exchangeable for our common stock.
We have agreed to indemnify the underwriters against certain liabilities, including liabilities under the Securities Act of 1933.
Our common stock is listed/quoted on the New York Stock Exchange under the symbol “BBG”. In connection with this offering, the underwriters may engage in
stabilizing transactions, which involves making bids for, purchasing and selling shares of common stock in the open market for the purpose of preventing or retarding a decline in the market price of the common stock while this offering is in
progress. These stabilizing transactions may include making short sales of the common stock, which involves the sale by the underwriters of a greater number of shares of common stock than they are required to purchase in this offering, and
purchasing shares of common stock on the open market to cover positions created by short sales. Short sales may be “covered” shorts, which are short positions in an amount not greater than the underwriters’ option to purchase
additional shares referred to above, or may be “naked” shorts, which are short positions in excess of that amount. The underwriters may close out any covered short position either by exercising their option to purchase additional shares,
in whole or in part, or by purchasing shares in the open market. In making this determination, the underwriters will consider, among
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other things, the price of shares available for purchase in the open market compared to the price at which the underwriters may purchase shares through the option to purchase additional shares. A
naked short position is more likely to be created if the underwriters are concerned that there may be downward pressure on the price of the common stock in the open market that could adversely affect investors who purchase in this offering. To the
extent that the underwriters create a naked short position, they will purchase shares in the open market to cover the position.
The underwriters have
advised us that, pursuant to Regulation M of the Securities Act of 1933, they may also engage in other activities that stabilize, maintain or otherwise affect the price of the common stock, including the imposition of penalty bids. This means
that if the representative of the underwriters purchase common stock in the open market in stabilizing transactions or to cover short sales, the representative can require the underwriters that sold those shares as part of this offering to repay the
underwriting discount received by them.
These activities may have the effect of raising or maintaining the market price of the common stock or
preventing or retarding a decline in the market price of the common stock, and, as a result, the price of the common stock may be higher than the price that otherwise might exist in the open market. If the underwriters commence these activities,
they may discontinue them at any time. The underwriters may carry out these transactions on the New York Stock Exchange, in the
over-the-counter
market or otherwise.
Other than in the United States, no action has been taken by us or the underwriters that would permit a public offering of the securities offered by
this prospectus in any jurisdiction where action for that purpose is required. The securities offered by this prospectus may not be offered or sold, directly or indirectly, nor may this prospectus or any other offering material or advertisements in
connection with the offer and sale of any such securities be distributed or published in any jurisdiction, except under circumstances that will result in compliance with the applicable rules and regulations of that jurisdiction. Persons into whose
possession this prospectus comes are advised to inform themselves about and to observe any restrictions relating to the offering and the distribution of this prospectus. This prospectus does not constitute an offer to sell or a solicitation of an
offer to buy any securities offered by this prospectus in any jurisdiction in which such an offer or a solicitation is unlawful.
In relation to each
Member State of the European Economic Area (each, a “Relevant Member State”), no offer of shares may be made to the public in that Relevant Member State other than:
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to any legal entity which is a qualified investor as defined in the Prospectus Directive;
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to fewer than 150 natural or legal persons (other than qualified investors as defined in the Prospectus Directive), as permitted under the Prospectus Directive, subject to
obtaining the prior consent of the representative; or
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in any other circumstances falling within Article 3(2) of the Prospectus Directive, provided that no such offer of shares shall require the Company or the representative to
publish a prospectus pursuant to Article 3 of the Prospectus Directive or supplement a prospectus pursuant to Article 16 of the Prospectus Directive.
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Each person in a Relevant Member State who initially acquires any shares or to whom any offer is made will be deemed to have represented, acknowledged and agreed that it is a “qualified investor” within
the meaning of the law in that Relevant Member State implementing Article 2(1)(e) of the Prospectus Directive. In the case of any shares being offered to a financial intermediary as that term is used in Article 3(2) of the Prospectus Directive,
each such financial intermediary will be deemed to have represented, acknowledged and agreed that the shares acquired by it in the offer have not been acquired on a
non-discretionary
basis on behalf of, nor
have
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they been acquired with a view to their offer or resale to, persons in circumstances which may give rise to an offer of any shares to the public other than their offer or resale in a
Relevant Member State to qualified investors as so defined or in circumstances in which the prior consent of the representative has been obtained to each such proposed offer or resale.
The Company, the representative and their affiliates will rely upon the truth and accuracy of the foregoing representations, acknowledgements and agreements.
This prospectus has been prepared on the basis that any offer of shares in any Relevant Member State will be made pursuant to an exemption under the Prospectus Directive from the requirement to publish a prospectus
for offers of shares. Accordingly any person making or intending to make an offer in that Relevant Member State of shares which are the subject of the offering contemplated in this prospectus may only do so in circumstances in which no obligation
arises for the Company or any of the underwriters to publish a prospectus pursuant to Article 3 of the Prospectus Directive in relation to such offer. Neither the Company nor the underwriters have authorized, nor do they authorize, the making
of any offer of shares in circumstances in which an obligation arises for the Company or the underwriters to publish a prospectus for such offer.
For
the purpose of the above provisions, the expression “an offer to the public” in relation to any shares in any Relevant Member State means the communication in any form and by any means of sufficient information on the terms of the offer
and the shares to be offered so as to enable an investor to decide to purchase or subscribe the shares, as the same may be varied in the Relevant Member State by any measure implementing the Prospectus Directive in the Relevant Member State and the
expression “Prospectus Directive” means Directive 2003/71/EC (including the 2010 PD Amending Directive, to the extent implemented in the Relevant Member States) and includes any relevant implementing measure in the Relevant Member State
and the expression “2010 PD Amending Directive” means Directive 2010/73/EU.
In addition, in the United Kingdom, this document is being
distributed only to, and is directed only at, and any offer subsequently made may only be directed at persons who are “qualified investors” (as defined in the Prospectus Directive) (i) who have professional experience in matters
relating to investments falling within Article 19 (5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the “Order”) and/or (ii) who are high net worth companies (or persons to whom it may
otherwise be lawfully communicated) falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as “relevant persons”).
Any person in the United Kingdom that is not a relevant person should not act or rely on the information included in this document or use it as basis for taking any action. In the United Kingdom, any investment or
investment activity that this document relates to may be made or taken exclusively by relevant persons. Any person in the United Kingdom that is not a relevant person should not act or rely on this document or any of its contents.
Certain of the underwriters and their affiliates have provided in the past to us and our affiliates and may provide from time to time in the future certain
commercial banking, financial advisory, investment banking and other services for us and such affiliates in the ordinary course of their business, for which they have received and may continue to receive customary fees and commissions. In addition,
from time to time, certain of the underwriters and their affiliates may effect transactions for their own account or the account of customers, and hold on behalf of themselves or their customers, long or short positions in our debt or equity
securities or loans, and may do so in the future. In particular, affiliates of certain of the underwriters are lenders under our credit facility. Additionally, an affiliate of J.P. Morgan Securities LLC acts as administrative agent under our credit
facility.
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Description of capital stock
As of the date of this prospectus supplement, we are authorized to issue up to 300,000,000 shares of common stock of $.001 par value, and 75,000,000 shares of
preferred stock, par value $.001 per share. As of December 4, 2017, there were 76,292,038 shares of common stock issued and outstanding and no shares of preferred stock issued and outstanding.
The following summary of certain provisions of our capital stock does not purport to be complete and is not intended to give full effect to provisions of statutory
or common law. The summary is subject to and is qualified in its entirety by reference to all the provisions of our certificate of incorporation and bylaws, copies of which are filed as exhibits to the registration statement of which this prospectus
is a part, and by the provisions of applicable law.
Common stock
Each share of our common stock is entitled to one vote on all matters presented to the holders of common stock. Cumulative voting is not allowed in the election of directors or for any other purpose, and the
holders of common stock have no preemptive rights, redemption rights or rights of conversion with respect to the common stock. When issued in the manner and for the full consideration approved by the board of directors, shares of common stock are
fully paid and nonassessable. The holders of common stock are entitled to receive dividends when, as and if declared by our board of directors, out of funds legally available for their payment subject to the rights of holders of any preferred stock
outstanding. Upon the liquidation, dissolution or winding up of our company, the holders of our common stock are entitled to receive ratably our net assets available after the payment of all debts and other liabilities and subject to the prior
rights of any outstanding preferred stock. Our board of directors is authorized to issue additional shares of common stock within the limits authorized by our certificate of incorporation and without stockholder action.
Our common stock is listed on the NYSE under the symbol “BBG.”
Preferred stock
Our preferred stock may carry such relative rights, preferences and designations as may be
determined by our board of directors in its sole discretion upon the issuance of any shares of preferred stock. The shares of preferred stock could be issued from time to time by action of the board of directors in its sole discretion (without
further approval or authorization by the stockholders), in one or more series, each of which series could have any particular distinctive designations as well as relative rights and preferences as determined by the board of directors. The relative
rights and preferences that may be determined by the board of directors in its discretion from time to time, include but are not limited to the following:
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the rate of dividends and whether the dividends are to be cumulative and the priority, if any, of dividend payments relative to other series in the class;
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whether the shares of any such series may be redeemed, and if so, the redemption price and the terms and conditions of redemption;
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the amount payable with respect to such series in the event of voluntary or involuntary liquidation; the priority, if any, of each series relative to other
series in the class with respect to amounts payable upon liquidation; and the sinking fund provisions, if any, for the redemption or purchase of the shares of that series; and
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the terms and conditions, if any, on which the shares of a series may be converted into or exchanged for shares of any class, whether common or preferred, or
into shares of any series of the same class, and if provision is made for conversion or exchange, the times, prices, rates, adjustments and other terms of such conversion or exchange.
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The existence of authorized but unissued shares of preferred stock could have anti-takeover effects because we could issue preferred stock with special dividend or
voting rights that could discourage potential bidders.
The Company may issue shares of preferred stock that have dividend, voting and other rights
superior to those of the common stock, or that convert into shares of common stock, without the approval of the holders of common stock. This could result in the dilution of the voting rights, ownership and liquidation value of current stockholders.
Anti-takeover effects of Delaware law and our certificate of incorporation and bylaws
General
Our certificate of incorporation and bylaws contain the following additional provisions, some
of which may have the effect of enhancing the likelihood of continuity and stability in the composition of our board of directors and in the policies formulated by our board of directors. In addition, some provisions of the Delaware General
Corporation Law (“DGCL”), if applicable to us, may hinder or delay an attempted takeover without prior approval of our board of directors. Provisions of the DGCL and of our certificate of incorporation and bylaws could discourage attempts
to acquire us or remove incumbent management even if some or a majority of our stockholders believe this action is in their best interest. These provisions could, therefore, prevent stockholders from receiving a premium over the market price for the
shares of common stock they hold.
Filling board of directors vacancies
Our certificate of incorporation provides that newly created directorships resulting from any increase in the authorized number of directors and vacancies will be filled by the affirmative vote of a majority of our
directors then in office, though less than a quorum, and not by the stockholders.
No stockholder action by written consent
Our certificate of incorporation precludes stockholders from initiating or effecting any action by written consent.
Call of special meetings
Our certificate of
incorporation provides that special meetings of our stockholders may be called only by the board of directors and not the stockholders.
Advance
notice requirements for stockholder proposals and director nominations
Our bylaws provide that stockholders seeking to nominate candidates for
election as directors at an annual or special meeting of stockholders, or to bring other business before an annual meeting of stockholders, must provide timely notice of their proposal in writing to the corporate secretary. To be timely, a
stockholder’s notice must be delivered to our corporate secretary at our principal executive offices by a specified date in advance of the meeting (typically, in the case of an annual meeting, a date that is 60 days prior to the first
anniversary of the date on which we mailed proxy materials for the preceding year’s annual stockholders’ meeting). Our
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bylaws also specify requirements as to the form and content of a stockholder’s notice and impose certain other requirements. These provisions may prevent stockholders from making nominations
for directors or proposing other business at a meeting of stockholders or may discourage or defer a potential acquirer from conducting a solicitation of proxies to elect its own slate of directors or otherwise attempting to obtain control of us.
No cumulative voting
Under the DGCL and
our certificate of incorporation, cumulative voting is not permitted in the election of our directors. Under cumulative voting, a minority stockholder holding a sufficient percentage of a class of shares may be able to ensure the election of one or
more directors.
Authorized but unissued shares
Under our certificate of incorporation, authorized but unissued shares of common stock and preferred stock are available for future issuance without stockholder approval, subject to limitations imposed by the NYSE.
These additional shares may be utilized for a variety of corporate purposes, including future public offerings to raise additional capital, corporate acquisitions and employee benefit plans. The existence of authorized but unissued shares of common
stock and preferred stock could make it more difficult or discourage an attempt to obtain control of our Company by means of a proxy contest, tender offer, merger or otherwise.
Delaware anti-takeover statute
We are subject to Section 203 of the DGCL, an anti-takeover law. In
general, this section prevents certain Delaware corporations under certain circumstances from engaging in a “business combination” with an “interested stockholder” (generally, a holder of 15% or more of the outstanding voting
stock of the corporation). A “business combination” includes a merger or sale of 10% or more of our assets. However, the above provisions of Section 203 do not apply if (1) our board approves the transaction prior to the person
becoming an “interested stockholder” or the transaction that results in the person becoming an “interested stockholder”; (2) after the completion of the transaction that resulted in the stockholder becoming an
“interested stockholder,” that stockholder owned at least 85% of our voting stock outstanding at the time the transaction commenced, excluding shares owned by certain of our directors and certain employee benefit plans; or (3) the
business combination is approved by our board and authorized at a meeting of our stockholders by an affirmative vote of at least
two-thirds
of the outstanding voting stock not owned by the “interested
stockholder.” This statute could prohibit or delay mergers or other change in control attempts, and thus may discourage attempts to acquire us.
Transfer agent and registrar
The transfer agent and
registrar for our common stock is Computershare Trust Company, N.A.
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Legal matters
The validity of the shares of common stock offered hereby will be passed upon for us by Davis Graham & Stubbs LLP, Denver, Colorado. Certain legal matters in connection with this offering will be passed
upon for the underwriters by Latham & Watkins LLP, Houston, Texas.
Experts
The financial statements, incorporated in this prospectus supplement by reference from Bill Barrett Corporation’s Annual Report on Form
10-K
for the year ended December 31, 2016, and the effectiveness of Bill Barrett Corporation’s internal control over financial reporting, have been audited by Deloitte & Touche LLP, an independent
registered public accounting firm, as stated in their reports, which are incorporated herein by reference. Such financial statements have been so incorporated in reliance upon the reports of such firm given upon their authority as experts in
accounting and auditing.
Certain information regarding our estimates of the oil and gas reserves associated with our oil and gas properties and the oil
and gas properties of Fifth Creek, included or incorporated by reference in this prospectus supplement has been reviewed by Netherland, Sewell & Associates, Inc., an independent petroleum engineering firm. The description of the review of
such estimates is included and incorporated by reference into this prospectus supplement upon the authority of said firm as an expert in these matters.
Where you can find more information
We are subject to the informational requirements of the Exchange Act and we file annual, quarterly and other reports and other information with the Securities and Exchange Commission (the “SEC”). You may
read and copy any document we file with the SEC at the SEC’s public reference room at 100 F Street NE, Washington, D.C. 20549-2521. Please call
1-800-732-0330
for further information concerning the operation of the public reference room. Our SEC filings are also available on the SEC’s web site at
http://www.sec.gov.
Unless
specifically listed under “Information Incorporated by Reference” below, the information contained on the SEC web site is not intended to be incorporated by reference in this prospectus supplement and you should not consider that
information a part of this prospectus supplement.
We make available free of charge on or through our Internet website, www.billbarrettcorp.com, our
Annual Reports on
Form 10-K,
Quarterly Reports on
Form 10-Q,
Current Reports on
Form 8-K
and amendments to those
reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC. Information contained on our Internet website is not
part of this prospectus supplement and does not constitute a part of this prospectus supplement.
Information
incorporated by reference
We “incorporate by reference” in this prospectus supplement certain documents that we have previously filed with
the SEC. This means that we are disclosing important information to you without actually including that information in this prospectus supplement by referring you to other documents that we have filed separately with the SEC. The information
incorporated by reference is an important part of this prospectus supplement. Information that we later provide to the SEC, and which is deemed “filed” with the SEC, will automatically
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update information that we previously filed with the SEC, and may replace information in this prospectus supplement and information that we previously filed with the SEC. We incorporate by
reference the following documents in this prospectus supplement, which you should review in connection with this prospectus supplement:
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our Annual Report on Form
10-K
for the year ended December 31, 2016, filed with the SEC on March 2, 2017;
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the information specifically incorporated by reference into our Annual Report on Form
10-K
for the year ended
December 31, 2016 from our Definitive Proxy Statement on Schedule 14A, filed with the SEC on April 6, 2017;
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our Quarterly Reports on Form
10-Q
for the quarters ended March 31, 2017, June 30, 2017 and September 30,
2017, filed with the SEC on May 2, 2017, August 1, 2017 and October 31, 2017, respectively; and
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our Current Reports on Form
8-K
or Form 8-K/A, filed with the SEC on April 28, 2017, May 16, 2017, July 3,
2017, August 10, 2017, November 22, 2017 and December 5, 2017 in each case, excluding any information furnished pursuant to Item 2.02 or Item 7.01 of Current Report on
Form 8-K
; and
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the description of our common stock contained in our Form
8-A
registration statement filed on December 2, 2004, as
amended on December 20, 2004 and March 18, 2013 (provided that such description is superseded by the disclosure in “Description of Capital Stock” above).
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We also incorporate by reference each of the documents that we file with the SEC (excluding those filings made under Items 2.02 or 7.01 of
Form 8-K
or other
information furnished to the SEC) under Sections 13(a), 13(c), 14, or 15(d) of the Exchange Act on or after the date of this prospectus supplement and before the termination of the offering of common stock under this prospectus supplement and
such documents shall be deemed to be incorporated in this prospectus supplement by reference and to be a part hereof from the date of the filing of such documents. Any statements made in such documents will automatically update and supersede the
information contained in this prospectus supplement, and any statements made in this prospectus supplement update and supersede the information contained in past SEC filings incorporated by reference into this prospectus supplement.
You may request a copy of these filings (other than an exhibit to a filing unless that exhibit is specifically incorporated by reference into that filing), at no
cost, by writing to us at the following address or calling the following number:
Bill Barrett Corporation
Attention: Corporate Secretary
1099 18
th
Street, Suite 2300
Denver, Colorado 80202
303-293-9100
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Prospectus
$500,000,000
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Common stock
Stock purchase units
Debt securities
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Preferred stock
Stock purchase contracts
Rights
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Depositary shares
Securities warrants
Guarantees of debt securities
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We may offer and sell from time to time:
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debt securities, which may be senior or subordinated;
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shares of common stock;
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stock purchase contracts;
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shares of preferred stock, which may be issued in the form of depositary shares evidenced by depositary receipts;
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rights to purchase common stock or preferred stock; and
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securities warrants to purchase debt securities, common stock, preferred stock or depositary shares.
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We may offer the securities separately or together, in separate series or classes and in amounts, at prices and on terms described in one or more offerings up to a
maximum aggregate amount of $500 million. This prospectus provides you with a general description of the securities that may be offered. Each time we offer and sell securities, we will provide one or more supplements to this prospectus that contain
more specific information about the offering and the terms of the securities. The supplements may also add, update or change information contained in this prospectus. You should carefully read this prospectus and the applicable prospectus supplement
before you invest in any of our securities.
The debt securities, preferred stock and purchase contracts may be convertible into or exercisable for
common or preferred stock or other securities. This prospectus also covers guarantees, if any, of our payment obligations under the debt securities, which may be given from time to time by one or more of our subsidiaries, on terms to be determined
at the time of the offering.
Our common stock is listed on the New York Stock Exchange under the symbol “BBG.”
We may offer and sell these securities to or through one or more underwriters, dealers and agents, or directly to purchasers, on a continuous or delayed basis. The
prospectus supplement for each offering of securities will describe in detail the plan of distribution for that offering.
Investing in our securities
involves certain risks. You should carefully consider the risks described under “
Risk Factors
” on page 4 of this prospectus, as well as the other information contained or incorporated by reference in this
prospectus and the applicable prospectus supplement, before making a decision to invest in our securities.
Neither the Securities and Exchange
Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.
The date of this prospectus is July 9, 2015
Table of contents
About this prospectus
This prospectus is part of a registration statement on Form S-3 that we filed with the Securities and Exchange Commission, or the SEC, using a “shelf” registration process. Under this shelf process, we
may, over time, sell any combination of the securities described in this prospectus in one or more offerings. This prospectus provides you with a general description of the securities we may offer pursuant to this prospectus. Each time we sell
securities, we will provide a prospectus supplement that will contain specific information about the terms of that offering. The prospectus supplement may also add, update or change information contained in this prospectus. You should read both this
prospectus and any accompanying prospectus supplement together with the additional information described under the heading “Where You Can Find More Information.”
In addition, we have filed or incorporated by reference exhibits to the registration statement of which this prospectus forms a part. You should read the exhibits carefully for provisions that may be important to
you.
You should rely only on the information incorporated by reference or provided in this registration statement. We have not authorized any dealer,
salesman or other person to provide you with additional or different information. This prospectus and any accompanying prospectus supplement are not an offer to sell or the solicitation of an offer to buy any securities other than the securities to
which they relate and are not an offer to sell or the solicitation of an offer to buy securities in any jurisdiction to any person to whom it is unlawful to make an offer or solicitation in that jurisdiction. You should not assume that the
information in this prospectus or any accompanying prospectus supplement or in any document incorporated by reference in this prospectus or any accompanying prospectus supplement is accurate as of any date other than the date of the document
containing the information.
Unless the context requires otherwise or unless otherwise noted, all references in this prospectus or any accompanying
prospectus supplement to the “Company,” “we,” “us” or “our” are to Bill Barrett Corporation and its subsidiaries.
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Where you can find more information
We file annual, quarterly and current reports, proxy statements and other information with the SEC. Our SEC filings (File No. 1-32367) are available to the
public over the Internet at the SEC’s website at http://www.sec.gov. You may also read and copy any document we file with the SEC at the SEC’s public reference room at 100 F Street, N.E., Washington, D.C. 20549. You may obtain information
on the operation of the SEC’s public reference room by calling the SEC at 1-800-SEC-0330. We make available free of charge through our website, http://www.billbarrettcorp.com, electronic copies of documents we file with the SEC, including our
Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K and any amendments to those reports. Access to those electronic filings is available as soon as reasonably practical after we file them with, or furnish
them to, the SEC. We make our website content available for information purposes only. Information on our website is not incorporated into this prospectus or our other securities filings and is not a part of these filings.
The SEC allows us to “incorporate by reference” the information we file with it, which means that we can disclose important information to you by
referring you to another document filed separately with the SEC. The information incorporated by reference is an important part of this prospectus, and information that we file later with the SEC will automatically update and supersede this
information. Any information so updated or superseded will not be deemed, except as so updated or superseded, to be a part of this prospectus. We incorporate by reference (excluding information deemed to have been furnished, and not filed, in
accordance with SEC rules) the documents listed below and any future filings made with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as amended (“Exchange Act”), before the termination of each
offering under this prospectus:
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our Annual Report on Form 10-K for the year ended December 31, 2014, including the information specifically incorporated by reference into our Annual Report on
Form 10-K from our definitive proxy statement for the 2015 Annual Meeting of Stockholders;
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our Quarterly Report on Form 10-Q filed on May 8, 2015;
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our Current Reports on Form 8-K filed on January 30, 2015, April 9, 2015, May 12, 2015 and June 10, 2015; and
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the description of our common stock contained in our Form 8-A registration statement filed on December 2, 2004, as amended on December 20, 2004.
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All reports and other documents we subsequently file pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act prior
to the termination of this offering, but excluding any information furnished to, rather than filed with, the SEC, will also be incorporated by reference into this prospectus and deemed to be part of this prospectus from the date of the filing of
such reports and documents.
You may request a copy of these filings (other than an exhibit to a filing unless that exhibit is specifically incorporated
by reference into that filing), at no cost, by writing us at the following address or telephoning us at the following number:
Bill
Barrett Corporation
Attention: Corporate Secretary
1099 18th Street, Suite 2300
Denver, Colorado 80202
303-293-9100
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About our company
Bill Barrett Corporation together with its wholly-owned subsidiaries, which may be guarantors of the debt securities described in this prospectus, develops, acquires and explores for oil and natural gas resources.
All of the Company’s assets and operations are located in the Rocky Mountain region of the United States. For additional information about our business, operations and financial results, please read the documents listed above under the heading
“Where You Can Find More Information.”
We are a Delaware corporation formed in January 2002. Our principal executive offices are located at
1099 18th Street, Suite 2300, Denver, Colorado 80202, and our telephone number at that address is 303-293-9100.
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Risk factors
An investment in our securities involves a high degree of risk. You should carefully consider the risk factors incorporated by reference from our most recent Annual Report on Form 10-K, as updated by any subsequent
Quarterly Reports on Form 10-Q or Current Reports on Form 8-K that we have filed or will file, and all other information contained or incorporated by reference into this prospectus and the risk factors and other information contained in the
applicable prospectus supplement before deciding to invest in our securities. The risks described are not the only risks facing our Company. Additional risks not presently known to us or which we currently consider immaterial also may adversely
affect our Company.
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Cautionary note regarding forward-looking statements
This prospectus and information incorporated into this prospectus contain “forward-looking statements” within the meaning of Section 27A of the
Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Exchange Act. These forward-looking statements are subject to a number of risks and uncertainties, many of which are beyond our control. Our actual
results could differ materially from those discussed in these forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, the following risks and uncertainties:
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potential failure to achieve expected production from existing and future exploration or development projects or acquisitions;
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volatility of market prices received for oil, natural gas and natural gas liquids;
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derivative and hedging activities;
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legislative, judicial or regulatory changes including initiatives related to drilling and completion techniques such as hydraulic fracturing;
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risks associated with operating in the Rocky Mountain region;
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our compliance with environmental and other regulations;
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economic and competitive conditions;
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the occurrence of property divestitures or acquisitions;
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costs and availability of third party facilities for gathering, processing, refining and transportation;
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future processing volumes and pipeline throughput;
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the impact of health and safety issues on our operations;
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operational risks, including industrial accidents and natural disasters;
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reductions in the borrowing base under our revolving credit facility;
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debt and equity capital market conditions;
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our ability to successfully receive drilling and other permits, regulatory approvals and required surface access and rights of way;
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higher than expected costs and expenses including production, drilling and well equipment costs;
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declines in the values of our oil and natural gas properties resulting in impairments;
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changes in estimates of our proved reserves;
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the potential for production decline rates from our wells to be greater than we expect;
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our ability to replace natural production declines with acquisitions, new drilling or recompletion activities;
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exploration risks such as the drilling of unsuccessful wells;
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capital expenditures and other contractual obligations;
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liabilities resulting from litigation concerning alleged damages related to environmental issues, pollution, contamination, personal injury, royalties,
marketing, title to properties, validity of leases or other matters that may not be covered by an effective indemnity or insurance;
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changes in tax laws and statutory tax rates; and
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other uncertainties, as well as those factors discussed in this prospectus and in our Annual Report on Form 10-K for the year ended December 31, 2014 under the
headings “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors.”
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All statements other than
statements of historical fact included in or incorporated into this prospectus are forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “expect”, “seek”,
“believe”, “upside”, “will”, “may”, “expect”, “anticipate”, “plan”, “will be dependent on”, “project”, “potential”, “intend”,
“could”, “should”, “estimate”, “predict”, “pursue”, “target”, “objective”, or the negative of such terms or other comparable terminology.
The forward-looking statements contained in this prospectus are largely based on our expectations, which reflect estimates and assumptions made by our management.
These estimates and assumptions reflect our best judgment based on currently known market conditions and other factors. Although we believe such estimates and assumptions to be reasonable, they are inherently uncertain and involve a number of risks
and uncertainties that are beyond our control. In addition, management’s assumptions about future events may prove to be inaccurate. Management cautions all readers that the forward-looking statements included or incorporated by reference into
this prospectus are not guarantees of future performance, and we cannot assure any reader that such statements will be realized or that forward-looking events and circumstances will occur. Actual results may differ materially from those anticipated
or implied in the forward-looking statements due to many factors including those listed above and in “Item 1A. Risk Factors” and elsewhere in our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.
Readers should not place undue reliance on these forward-looking statements, which reflect management’s views only as of the date these statements are made. Other than as required under applicable securities laws, we do not intend to, and do
not undertake any obligation to, publicly update or revise any forward-looking statements as a result of changes in internal estimates or expectations, new information, subsequent events or circumstances or otherwise. These cautionary statements
qualify all forward-looking statements attributable to us or persons acting on our behalf.
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Use of proceeds
Except as may be stated in any prospectus supplement, we intend to use the net proceeds from any sales of securities by us under this prospectus for general corporate purposes. If we decide to use the net proceeds
from a particular offering of securities for a specific purpose, we will describe that in the related prospectus supplement.
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Ratio of earnings to fixed charges
For purposes of determining the ratio of earnings to fixed charges, (i) earnings are defined as income (loss) before income taxes plus interest expense and
amortization of debt related costs and (ii) fixed charges are defined as interest expense, capitalized interest, amortized premiums, discounts and capitalized expenses related to indebtedness.
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Three months
ended
March 31,
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Fiscal year ended December 31,
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2015
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2014
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2013
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2012
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2011
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2010
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Ratio of earnings to fixed charges
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—
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(1)
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1.5
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—
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(2)
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1.0
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1.7
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3.5
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(1)
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Due to our net loss for the quarter ended March 31, 2015, the coverage ratio was less than 1:1. To achieve a coverage ratio of 1:1, we would have needed additional earnings of
approximately $18.6 million for the quarter ended March 31, 2015.
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(2)
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Due to our net loss for the year ended December 31, 2013, the coverage ratio was less than 1:1. To achieve a coverage ratio of 1:1, we would have needed additional earnings of
approximately $311.1 million for the year ended December 31, 2013.
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We had no preferred stock outstanding for any period presented, and
accordingly our ratio of earnings to combined fixed charges and preferred stock dividends is the same as our ratio of earnings to fixed charges.
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Description of debt securities and guarantees
General
We may issue senior or subordinated debt securities.
Neither the senior debt securities nor the subordinated debt securities will be secured by any of our property or assets. Thus, by owning a debt security, you are one of our unsecured creditors.
The senior debt securities will constitute part of our senior debt, will be issued under our senior debt indenture described below and will rank equally with all of
our other unsecured and unsubordinated debt.
The subordinated debt securities will constitute part of our subordinated debt, will be issued under our
subordinated debt indenture described below and will be subordinate in right of payment to all of our “senior debt,” as defined in the indenture with respect to subordinated debt securities. The prospectus supplement for any series of
subordinated debt securities or the information incorporated in this prospectus by reference will indicate the approximate amount of senior debt outstanding as of the end of our most recent fiscal quarter. Neither indenture limits our ability to
incur additional senior debt or other indebtedness.
When we refer to “debt securities” in this prospectus, we mean both the senior debt
securities and the subordinated debt securities. The debt securities may be convertible into or exercisable for common or preferred stock or other securities of ours or debt or equity securities of one or more other entities.
The debt securities may have the benefit of guarantees (each, a “guarantee”) by one or more of the subsidiaries of Bill Barrett Corporation identified
herein (each, a “guarantor”). If a guarantor issues guarantees, the guarantees will be unsecured and, if guaranteeing senior debt securities, unsubordinated or, if guaranteeing subordinated debt securities, subordinated obligations of the
respective guarantors. Unless otherwise expressly stated or the context otherwise requires, as used in this section, the term “guaranteed debt securities” means debt securities that, as described in the prospectus supplement relating
thereto, are guaranteed by one or more guarantors pursuant to the applicable indenture.
This section and your prospectus supplement summarize certain
general terms and provisions of the indentures and your debt security. They do not, however, describe every aspect of the indentures and your debt security. For example, in this section and your prospectus supplement, we use terms that have been
given special meaning in the indentures, but we describe the meaning for only the more important of those terms.
This summary is subject to, and are
qualified in its entirety by reference to, all of the provisions of the applicable indenture, as supplemented from time to time, your debt security, and to the Trust Indenture Act of 1939, as amended. We have filed forms of the indentures with
the SEC as exhibits to our registration statement, of which this prospectus is a part; however, the indentures may be amended in the future. See “Where You Can Find More Information” above for information on how to obtain copies of them.
Indentures
The senior debt securities and
subordinated debt securities are each governed by a document each called an indenture. Each indenture is a contract between us, any of our subsidiary guarantors, and the indenture trustee, which is currently Deutsche Bank Trust Company Americas. We
may issue senior debt securities offered by this prospectus under our existing indentures, if the applicable existing indenture is still in existence on the date of issue of senior debt. We have two existing indentures. The first existing indenture
is dated as of March 12, 2008, as supplemented as of March 12, 2008, July 8, 2009 and August 3, 2011, and is among us, the guarantors party thereto and Deutsche Bank Trust Company Americas, as trustee. The second existing
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indenture is dated as of July 8, 2009, as supplemented as of July 8, 2009, August 3, 2011, September 27, 2011 and March 12, 2012, and is among us, the
guarantors party thereto and Deutsche Bank Trust Company Americas, as trustee.
The trustee under each indenture has two main roles:
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First, the trustee can enforce your rights against us if we default. There are some limitations on the extent to which the trustee acts on your behalf, which we
describe later under “—Default, Remedies and Waiver of Default” and as set forth in each specific indenture.
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Second, the trustee performs administrative duties for us, such as sending you interest payments and notices.
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When we refer to the indenture or the trustee with respect to any debt securities, we mean the indenture under which those debt securities are issued and the
trustee under that indenture.
Series of debt securities
We may issue many distinct debt securities or series of debt securities under either indenture as we wish. This section summarizes terms of the securities that apply generally to all debt securities and series of
debt securities. The provisions of each indenture allow us not only to issue debt securities with terms different from those of debt securities previously issued under that indenture, but also to “reopen” a previously issued series of debt
securities and issue additional debt securities of that series. We will describe most of the financial and other specific terms of your series, whether it be a series of the senior debt securities or subordinated debt securities, in the prospectus
supplement for that series. Those terms may vary from the terms described here.
As you read this section, please remember that the specific terms of
your debt security as described in your prospectus supplement will supplement and may modify or replace the general terms described in this section. If there are any differences between your prospectus supplement and this prospectus, your prospectus
supplement will control. Thus, the statements we make in this section may not apply to your debt security.
When we refer to a “debt security”
or a “series of debt securities,” we mean, respectively, a debt security or a series of debt securities issued under a particular indenture. When we refer to “your debt security,” we mean a debt security you purchase. When we
refer to your prospectus supplement, we mean the prospectus supplement describing the specific terms of your debt security. The terms used in your prospectus supplement will have the meanings described in this prospectus, unless otherwise specified.
Amounts of issuances
Neither indenture limits
the aggregate amount of debt securities that we may issue or the number of series or the aggregate amount of any particular series. We may issue debt securities and other securities at any time without your consent and without notifying you.
Unless otherwise specified in a prospectus supplement, the indentures and the debt securities do not limit our ability to incur other indebtedness or to
issue other securities. Also, unless otherwise specified below or in your prospectus supplement, we are not subject to financial or similar restrictions by the terms of the debt securities.
Principal amount, stated maturity and maturity
Unless otherwise stated, the principal amount of a debt
security means the principal amount payable at its stated maturity, unless that amount is not determinable, in which case the principal amount of a debt security is its face amount.
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The term “stated maturity” with respect to any debt security means the day on which the principal amount of
your debt security is scheduled to become due. The principal may become due sooner, by reason of redemption or acceleration after a default or otherwise in accordance with the terms of the debt security. The day on which the principal actually
becomes due, whether at the stated maturity or earlier, is called the “maturity” of the principal.
We also use the terms “stated
maturity” and “maturity” to refer to the days when other payments become due. For example, we may refer to a regular interest payment date when an installment of interest is scheduled to become due as the “stated maturity”
of that installment. When we refer to the “stated maturity” or the “maturity” of a debt security without specifying a particular payment, we mean the stated maturity or maturity, as the case may be, of the principal.
Specific terms of debt securities
Your prospectus
supplement will describe the specific terms of your debt security, which will include some or all of the following:
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the title of the series of your debt security and whether it is a senior debt security or a subordinated debt security;
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any limit on the total principal amount of the debt securities of the same series;
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the currency or currencies for principal and interest, if not U.S. dollars;
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the price at which we originally issue your debt security, expressed as a percentage of the principal amount, and the original issue date;
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whether your debt security is a fixed rate debt security, a floating rate debt security or an indexed debt security;
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if your debt security is a fixed rate debt security, the yearly rate at which your debt security will bear interest, if any, and the interest payment dates;
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if your debt security is a floating rate debt security, the interest rate basis; any applicable index currency or index maturity, spread or spread multiplier or
initial base rate, maximum rate or minimum rate; the interest reset, determination, calculation and payment dates; the day count convention used to calculate interest payments for any period; the business day convention; and the calculation agent;
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if your debt security is an indexed debt security, the principal amount, if any, we will pay you at maturity, interest payment dates, the amount of interest, if
any, we will pay you on an interest payment date or the formula we will use to calculate these amounts, if any, and the terms on which your debt security will be exchangeable for or payable in cash, securities or other property;
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if your debt security may be converted into or exercised or exchanged for common or preferred stock or other securities of the Company or debt or equity
securities of one or more third parties, the terms on which conversion, exercise or exchange may occur, including whether conversion, exercise or exchange is mandatory, at the option of the holder or at our option, the period during which
conversion, exercise or exchange may occur, the initial conversion, exercise or exchange price or rate and the circumstances or manner in which the amount of common or preferred stock or other securities issuable upon conversion, exercise or
exchange may be adjusted;
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if your debt security is also an original issue discount debt security, the yield to maturity;
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if applicable, the circumstances under which your debt security may be redeemed at our option or repaid at the holder’s option before the stated maturity,
including any redemption commencement date, repayment date(s), redemption price(s) and redemption period(s);
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the authorized denominations, if other than $1,000 and integral multiples of $1,000;
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the depositary for your debt security, if other than The Depository Trust Company (“DTC”), and any circumstances under which the holder may request
securities in non-global form, if we choose not to issue your debt security in book-entry form only;
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if applicable, the circumstances under which we will pay additional amounts on any debt securities held by a person who is not a U.S. person for tax purposes and
under which we can redeem the debt securities if we have to pay additional amounts;
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whether your debt security will be guaranteed by any guarantors and, if so, the identity of the guarantors and, to the extent the terms thereof differ from those
described in this prospectus, a description of the terms of the guarantees;
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the names and duties of any co-trustees, depositaries, authenticating agents, paying agents, transfer agents or registrars for your debt security, as applicable;
and
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any other terms of your debt security and any guarantees of your debt security, which could be different from those described in this prospectus.
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We may issue debt securities at a discount from their stated principal amount. Federal income tax considerations and other special
considerations applicable to any debt security issued with original issue discount may be described in an applicable prospectus supplement.
Governing law
The indentures and the debt securities (and
any guarantees thereof) will be governed by the laws of the State of New York except to the extent that the Trust Indenture Act of 1939 is applicable.
Global securities
Unless we inform you otherwise in the
applicable prospectus supplement, a series of debt securities may be issued in whole or in part in the form of one or more global securities that will be deposited with, or on behalf of, a depositary identified in the applicable prospectus
supplement. Global securities will be issued in registered form and in either temporary or definitive form. Unless and until it is exchanged in whole or in part for the individual debt securities, a global security may not be transferred except as a
whole by the depositary for such global security to a nominee of such depositary or by a nominee of such depositary to such depositary or another nominee of such depositary or by such depositary or any such nominee to a successor of such depositary
or a nominee of such successor. The specific terms of the depositary arrangement with respect to any series of debt securities and the rights of and limitations upon owners of beneficial interests in a global security will be described in the
applicable prospectus supplement.
Redemption or repayment
If there are any provisions regarding redemption or repayment applicable to your debt security, we will describe them in your prospectus supplement.
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We or our affiliates may purchase debt securities from investors who are willing to sell from time to time, either in
the open market at prevailing prices or in private transactions at negotiated prices. Debt securities that we or they purchase may, at our discretion, be held, resold or canceled.
Mergers and similar transactions
We are generally permitted under the indenture for the relevant series of
debt securities to merge or consolidate with another corporation or other entity. We are also permitted under the indenture for the relevant series of debt securities to sell all or substantially all of our assets to another corporation or other
entity. With regard to any series of debt securities, however, unless otherwise specified in the supplemental indenture establishing a series of debt securities, we may not take any of these actions unless all the following conditions, among other
things, are met:
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If the successor entity in the transaction is not the Company, the successor entity must be organized as a corporation, partnership, limited liability company or
trust and must expressly assume our obligations under the debt securities of that series and the indenture with respect to that series of debt securities. The successor entity may be organized under the laws of the United States, any state thereof
or the District of Columbia.
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Immediately after the transaction, no default under the debt securities of that series has occurred and is continuing. For this purpose, “default under the
debt securities of that series” means an event of default with respect to that series of debt securities or any event that would be an event of default with respect to that series of debt securities if the requirements for giving us default
notice and for our default having to continue for a specific period of time were disregarded. We describe these matters below under “—Default, Remedies and Waiver of Default.”
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If the conditions described above are satisfied with respect to any series of debt securities, we will not need to obtain the approval of the holders of those debt
securities in order to merge or consolidate or to sell our assets. In such event, the successor will be substituted for us, and thereafter all of our obligations under the relevant indenture, the debt securities and any coupons will terminate. Also,
these conditions will apply only if we wish to merge or consolidate with another entity or sell all or substantially all of our assets to another entity. We will not need to satisfy these conditions if we enter into other types of transactions,
including any transaction in which we acquire the stock or assets of another entity, any transaction that involves a change of control of the Company but in which we do not merge or consolidate and any transaction in which we sell less than
substantially all our assets.
If we sell all or substantially all of our assets, we will be released from all our liabilities and obligations under the
debt securities of any series and the indenture with respect to that series.
Subordination provisions
Holders of subordinated debt securities should recognize that contractual provisions in the subordinated debt indenture may prohibit us from making payments on
those securities. Subordinated debt securities are subordinate and junior in right of payment, to the extent and in the manner stated in the subordinated debt indenture, to all of our senior debt, as defined in the subordinated debt indenture,
including all debt securities we have issued and will issue under the senior debt indenture.
The subordinated debt indenture defines “senior
debt” as:
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our indebtedness under or in respect of our credit agreement, whether for principal, interest (including interest accruing after the filing of a petition
initiating any proceeding pursuant to any bankruptcy law, whether or not the claim for such interest is allowed as a claim in such proceeding), reimbursement obligations, fees, commissions, expenses, indemnities or other amounts; and
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any other indebtedness permitted under the terms of that indenture, unless the instrument under which such indebtedness is incurred expressly provides that it is
on a parity with or subordinated in right of payment to the subordinated debt securities.
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Notwithstanding the foregoing, “senior
debt” will not include: (i) equity interests; (ii) any liability for taxes; (iii) any indebtedness to any of our subsidiaries or affiliates; (iv) any trade payables; or (v) any indebtedness incurred in violation of the
subordinated debt indenture.
We may modify the subordination provisions, including the definition of senior debt, with respect to one or more series of
subordinated debt securities. Such modifications will be set forth in the applicable prospectus supplement.
The subordinated debt indenture provides
that, unless all principal of and any premium or interest on the senior debt has been paid in full, no payment or other distribution may be made in respect of any subordinated debt securities in the following circumstances:
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in the event of any insolvency or bankruptcy proceedings, or any receivership, liquidation, reorganization, assignment for creditors or other similar proceedings
or events involving us or our assets;
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(a) in the event and during the continuation of any default in the payment of principal, premium or interest on any senior debt beyond any applicable grace
period or (b) in the event that any event of default with respect to any senior debt has occurred and is continuing, permitting the holders of that senior debt (or a trustee) to accelerate the maturity of that senior debt, whether or not the
maturity is in fact accelerated (unless, in the case of (a) or (b), the payment default or event of default has been cured or waived or ceased to exist and any related acceleration has been rescinded) or (c) in the event that any judicial proceeding
is pending with respect to a payment default or event of default described in (a) or (b); or
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in the event that any subordinated debt securities have been declared due and payable before their stated maturity.
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If the trustee under the subordinated debt indenture or any holders of the subordinated debt securities receive any payment or distribution that is prohibited under
the subordination provisions, then the trustee or the holders will have to repay that money to the holders of the senior debt.
Even if the subordination
provisions prevent us from making any payment when due on the subordinated debt securities of any series, we will be in default on our obligations under that series if we do not make the payment when due. This means that the trustee under the
subordinated debt indenture and the holders of that series can take action against us, but they will not receive any money until the claims of the holders of senior debt have been fully satisfied.
The subordinated debt indenture allows the holders of senior debt to obtain a court order requiring us and any holder of subordinated debt securities to comply with
the subordination provisions.
Legal defeasance, covenant defeasance and satisfaction and discharge
When we use the term defeasance, we mean discharge from some or all of our obligations under the applicable indenture. If we deposit with the trustee funds or
government securities, or if so provided in your prospectus supplement, obligations other than government securities, sufficient to make payments on any series of debt securities on the dates those payments are due and payable and other specified
conditions are satisfied, then, at our option, either of the following will occur:
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we will be discharged from our obligations with respect to the debt securities of such series and all obligations of any guarantors of such debt securities will
also be discharged with respect to the guarantees of such debt securities (“legal defeasance”); or
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we will be discharged from any covenants we make in the applicable indenture for the benefit of such series and the related events of default will no longer
apply to us (“covenant defeasance”).
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If we defease any series of debt securities, the holders of such securities will not be
entitled to the benefits of the applicable indenture, except for our obligations to register the transfer or exchange of such securities, replace stolen, lost or mutilated securities or maintain paying agencies and hold moneys for payment in trust.
In case of covenant defeasance, our obligation to pay principal, premium and interest on the applicable series of debt securities will also survive.
We
will be required to deliver to the trustee an opinion of counsel that the deposit and related defeasance would not cause the holders of the applicable series of debt securities to recognize gain or loss for federal income tax purposes. If we elect
legal defeasance, that opinion of counsel must be based upon a ruling from the United States Internal Revenue Service or a change in law to that effect.
Upon the effectiveness of defeasance with respect to any series of guaranteed debt securities, each guarantor of the debt securities of such series will be
automatically and unconditionally released and discharged from all of its obligations under its guarantee of the debt securities of such series and all of its other obligations under the applicable indenture in respect of the debt securities of that
series, without any action by the Company, any guarantor or the trustee and without the consent of the holders of any debt securities.
In addition, we
may satisfy and discharge all our obligations under the indenture with respect to debt securities of any series, other than our obligation to register the transfer of and exchange debt securities of that series, provided that we either:
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deliver all outstanding debt securities of that series to the trustee for cancellation; or
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all such debt securities not so delivered for cancellation have either become due and payable or will become due and payable at their stated maturity within one
year or are to be called for redemption within one year, and in the case of this bullet point, we have deposited with the trustee in trust an amount of cash sufficient to pay the entire indebtedness of such debt securities, including interest to the
stated maturity or applicable redemption date.
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Default, remedies and waiver of default
Events of default
Unless the securities resolution or
supplemental indenture establishing the series of debt securities otherwise provides (in which event the prospectus supplement will so state), an “event of default” with respect to a series of debt securities will occur if:
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we do not pay the principal or any premium on any debt security of that series on the due date;
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we do not pay interest on any debt security of that series within 30 days after the due date;
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we do not deposit a sinking fund payment with regard to any debt security of that series within 60 days after the due date, but only if the payment is required
under provisions described in the applicable prospectus supplement;
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we remain in breach of our covenants regarding mergers or sales of substantially all of our assets or any other covenant we make in the indenture for the benefit
of the relevant series, for 90 days after we receive a notice of default stating that we are in breach and requiring us to remedy the breach. The notice must be sent by the trustee or the holders of at least 25% in principal amount of the relevant
series of debt securities;
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we file for bankruptcy or other events of bankruptcy, insolvency or reorganization relating to the Company occur;
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if the debt securities of that series are guaranteed debt securities, the guarantee of the debt securities of that series by any guarantor shall for any reason
cease to be, or shall for any reason be asserted in writing by such guarantor or the Company, not to be, in full force and effect and enforceable in accordance with its terms, except to the extent contemplated or permitted by the indenture or the
debt securities of that series; or
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if the applicable prospectus supplement states that any additional event of default applies to the series, that event of default occurs.
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Remedies if an event of default occurs
If you are the holder of a subordinated debt security, all the remedies available upon the occurrence of an event of default under the subordinated debt indenture will be subject to the restrictions on the
subordinated debt securities described above under “—Subordination Provisions.”
Except as otherwise specified in the applicable
prospectus supplement, if an event of default has occurred with respect to any series of debt securities and has not been cured or waived, the trustee or the holders of not less than 25% in principal amount of all debt securities of that series then
outstanding may declare the entire principal amount of the debt securities of that series to be due immediately. Except as otherwise specified in the applicable prospectus supplement, if the event of default occurs because of events in bankruptcy,
insolvency or reorganization relating to the Company, the entire principal amount of the debt securities of that series will be automatically accelerated, without any action by the trustee or any holder.
Each of the situations described above is called an acceleration of the stated maturity of the affected series of debt securities. Except as otherwise specified in
the applicable prospectus supplement, if the stated maturity of any series is accelerated and a judgment for payment has not yet been obtained, the holders of a majority in principal amount of the debt securities of that series may cancel the
acceleration for the entire series.
If an event of default occurs, the trustee will have special duties. In that situation, the trustee will be
obligated to use those of its rights and powers under the relevant indenture, and to use the same degree of care and skill in doing so, that a prudent person would use in that situation in conducting his or her own affairs.
Except as described in the prior paragraph, the trustee is not required to take any action under the relevant indenture at the request of any holders unless the
holders offer the trustee reasonable protection from expenses and liability. This is called an indemnity. If the trustee is provided with an indemnity reasonably satisfactory to it, the holders of a majority in principal amount of all debt
securities of the relevant series may direct the time, method and place of conducting any lawsuit or other formal legal action seeking any remedy available to the trustee with respect to that series. These majority holders may also direct the
trustee in performing any other action under the relevant indenture with respect to the debt securities of that series.
Before you bypass the trustee
and bring your own lawsuit or other formal legal action or take other steps to enforce your rights or protect your interests relating to any debt security, all of the following must occur:
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the holder of your debt security must give the trustee written notice that an event of default has occurred with respect to the debt securities of your series,
and the event of default must not have been cured or waived;
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the holders of not less than 25% in principal amount of all debt securities of your series must make a written request that the trustee take action because of
the default, and they or other holders must offer to the trustee indemnity reasonably satisfactory to the trustee against the cost and other liabilities of taking that action;
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the trustee must not have taken action for 60 days after the above steps have been taken; and
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during those 60 days, the holders of a majority in principal amount of the debt securities of your series must not have given the trustee directions that are
inconsistent with the written request of the holders of not less than 25% in principal amount of the debt securities of your series.
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However, the limitations described above do not apply to a suit instituted by a holder of a debt security for enforcement of payment of the principal of and
interest on such debt security on or after the applicable due dates for the payment of such principal and interest.
Book-entry and other indirect owners
should consult their banks or brokers for information on how to give notice or direction to or make a request of the trustee and how to declare or cancel an acceleration of the maturity.
Waiver of default
The holders of not less than a majority in principal amount of the debt securities of
any series may waive a default for all debt securities of that series. If this happens, the default will be treated as if it has not occurred. No one can waive a payment default on your debt security, however, without the approval of the particular
holder of that debt security.
Annual information about defaults to the trustee
We are required to furnish the trustee annually a brief certificate as to our compliance with all conditions and covenants under the indentures.
Modifications and waivers
In general, modifications and amendments of the indenture may be made by us and the
trustee with the consent of the holders of not less than a majority in principal amount of the debt securities of each series affected thereby. However, no modification or amendment of the indenture may, without the consent of the holder of each
debt security affected thereby:
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change the stated maturity of, or any installment of principal of, or interest on, any debt security;
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reduce the principal amount of, the rate of interest on, or the premium, if any, payable upon the redemption of, any debt security;
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reduce the amount of principal of an original issue discount security payable upon acceleration of the maturity thereof;
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change the place or currency of payment of principal of, or premium, if any, or interest on any debt security;
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impair the right to institute suit for the enforcement of any payment on or with respect to any debt security on or after the stated maturity or prepayment date
thereof; or
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reduce the percentage in principal amount of debt securities of any series required for modification or amendment of the indenture or for waiver of compliance
with certain provisions of the indenture or for waiver of certain defaults.
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We may not amend the indenture related to subordinated debt
securities to alter the subordination of any outstanding subordinated debt securities without the written consent of each holder of senior debt then outstanding who would be adversely affected (or the group or representative thereof authorized or
required to
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consent thereto pursuant to the instrument creating or evidencing, or pursuant to which there is outstanding, such senior debt). In addition, we may not modify the subordination provisions of the
indenture related to subordinated debt securities in a manner that would adversely affect the subordinated debt securities of any one or more series then outstanding in any material respect, without the consent of the holders of a majority in
aggregate principal amount of all affected series then outstanding, voting together as one class (and also of any affected series that by its terms is entitled to vote separately as a series, as described below).
The holders of at least a majority in principal amount of the debt securities of any series may, on behalf of the holders of all debt securities of that series,
waive our compliance with specified covenants of the indenture. The holders of at least a majority in principal amount of the debt securities of any series may, on behalf of the holders of all debt securities of that series, waive any past default
under the indenture with respect to that series, except:
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a default in the payment of the principal of, or premium, if any, or interest on, any debt security of that series; or
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a default of a provision of the indenture that cannot be modified or amended without the consent of the holder of each debt security of that series.
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Without the consent of any holder of debt security, the indentures or the debt securities may be amended to provide for assumption of
our obligations to holders of debt securities in the event of a merger or consolidation requiring such assumption; to cure any ambiguity, omission, defect or inconsistency; to conform the terms of the debt securities to the description thereof in
the prospectus and prospectus supplement offering such debt securities; to create a series and establish its terms; to provide for assumption of our obligations to holders of debt securities in the event of a merger or consolidation requiring such
assumption; to make any change that does not adversely affect the rights of any holders of debt security; to add to our covenants; or to make any other change to the indentures so long as no debt securities are outstanding.
Special rules for action by holders
Only holders of
outstanding debt securities of the applicable series will be eligible to take any action under the applicable indenture, such as giving a notice of default, declaring an acceleration, approving any change or waiver or giving the trustee an
instruction with respect to debt securities of that series. Also, we will count only outstanding debt securities in determining whether the various percentage requirements for taking action have been met. Any debt securities owned by us or any of
our affiliates or surrendered for cancellation or for payment or redemption of which money has been set aside in trust are not deemed to be outstanding.
In some situations, we may follow special rules in calculating the principal amount of debt securities that are to be treated as outstanding for the purposes
described above. This may happen, for example, if the principal amount is payable in a non-U.S. dollar currency, increases over time or is not to be fixed until maturity.
We will generally be entitled to set any day as a record date for the purpose of determining the holders that are entitled to take action under either indenture. In certain limited circumstances, only the trustee
will be entitled to set a record date for action by holders. If we or the trustee sets a record date for an approval or other action to be taken by holders, that vote or action may be taken only by persons or entities who are holders on the record
date and must be taken during the period that we specify for this purpose, or that the trustee specifies if it sets the record date. We or the trustee, as applicable, may shorten or lengthen this period from time to time. This period, however, may
not extend beyond the 180th day after the record date for the action. In addition, record dates for any global debt security may be set in accordance with procedures established by the depositary from time to time. Accordingly, record dates for
global debt securities may differ from those for other debt securities.
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Guarantees
The
debt securities of any series may be guaranteed by one or both of our subsidiaries: Circle B Land Company LLC and Aurora Gathering, LLC. However, the applicable indenture governing the debt securities will not require that any of our subsidiaries be
a guarantor of any series of debt securities and will permit the guarantors for any series of guaranteed debt securities to be different from any of the subsidiaries listed above under “—General.” As a result, a series of debt
securities may not have any guarantors and the guarantors of any series of guaranteed debt securities may differ from the guarantors of any other series of guaranteed debt securities. If the Company issues a series of guaranteed debt securities, the
identity of the specific guarantors of the debt securities of that series will be identified in the applicable prospectus supplement.
If the Company
issues a series of guaranteed debt securities, a description of some of the terms of guarantees of those debt securities will be set forth in the applicable prospectus supplement. Unless otherwise provided in the prospectus supplement relating to a
series of guaranteed debt securities, each guarantor of the debt securities of such series will unconditionally guarantee the due and punctual payment of the principal of, and premium, if any, and interest, if any, on each debt security of such
series, all in accordance with the terms of such debt securities and the applicable indenture.
Notwithstanding the foregoing, unless otherwise provided
in the prospectus supplement relating to a series of guaranteed debt securities, the applicable indenture will contain provisions to the effect that the obligations of each guarantor under its guarantees and such indenture will be limited to the
maximum amount as will, after giving effect to all other contingent and fixed liabilities of such guarantor, result in the obligations of such guarantor under such guarantees and such indenture not constituting a fraudulent conveyance or fraudulent
transfer under applicable law. However, there can be no assurance that, notwithstanding such limitation, a court would not determine that a guarantee constituted a fraudulent conveyance or fraudulent transfer under applicable law. If that were to
occur, the court could void the applicable guarantor’s obligations under that guarantee, subordinate that guarantee to other debt and other liabilities of that guarantor or take other action detrimental to holders of the debt securities of the
applicable series, including directing the holders to return any payments received from the applicable guarantor.
Unless otherwise provided in the
prospectus supplement relating to a series of guaranteed debt securities, the applicable indenture will (i) provide that, upon the sale or disposition (by merger or otherwise) of any guarantor, (x) if the transferee is not an affiliate of
the Company, such guarantor will automatically be released from all obligations under its guarantee of such debt securities or (y) otherwise, the transferee (if other than the Company or another guarantor) will assume the guarantor’s
obligations under its guarantee of such debt securities and (ii) permit us to cause the guarantee of any guarantor of such debt securities to be released at any time if we satisfy such conditions, if any, as are specified in the prospectus
supplement for such debt securities.
The applicable prospectus supplement relating to any series of guaranteed debt securities will specify other terms
of the applicable guarantees.
If the applicable prospectus supplement relating to a series of our senior debt securities provides that those senior debt
securities will have the benefit of a guarantee by any or all of our subsidiaries identified herein, unless otherwise provided in the applicable prospectus supplement, each such guarantee will be the unsubordinated and unsecured obligation of the
applicable guarantor and will rank equally in right of payment with all of the unsecured and unsubordinated indebtedness of such guarantor.
Any
guarantee of any debt securities will be effectively subordinated to all existing and future secured indebtedness of the applicable guarantor, including any secured guarantees of other Company debt, to the extent of the value of the collateral
securing that indebtedness. Consequently, in the event of a bankruptcy, or
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similar proceeding with respect to any guarantor that has provided a guarantee of any debt securities, the holders of that guarantor’s secured indebtedness will be entitled to proceed
directly against the collateral that secures that secured indebtedness and such collateral will not be available for satisfaction of any amount owed by such guarantor under its unsecured indebtedness, including its guarantees of any debt securities,
until that secured debt is satisfied in full. Unless otherwise provided in the applicable prospectus supplement, the indenture will not limit the ability of any guarantor to incur secured indebtedness.
If the applicable prospectus supplement relating to a series of our subordinated debt securities provides that those subordinated debt securities will have the
benefit of a guarantee by any or all of our subsidiaries identified herein, unless otherwise provided in the applicable prospectus supplement, each such guarantee will be the subordinated and unsecured obligation of the applicable guarantor and, in
addition to being effectively subordinated to secured debt of such guarantor, will be subordinated in right of payment to all of such guarantor’s existing and future senior indebtedness, including any guarantee of the senior debt securities, to
the same extent and in the same manner as the subordinated debt securities are subordinated to our senior debt. See “—Subordination Provisions” above.
Paying agents
We may appoint one or more financial institutions to act as our paying agents, at whose
designated offices debt securities in non-global entry form may be surrendered for payment at their maturity. We call each of those offices a paying agent. We may add, replace or terminate paying agents from time to time. We may also choose to act
as our own paying agent. We will specify in the prospectus supplement for your debt security the initial location of each paying agent for that debt security. We must notify the trustee of changes in the paying agents.
Regardless of who acts as paying agent, all money paid by us to a paying agent that remains unclaimed at the end of two years after the amount is due to a holder
will be repaid to us. After that two-year period, the holder may look only to us for payment and not to the trustee, any other paying agent or anyone else.
Notices
Notices to be given to holders of a global debt security will be given only to the depositary, in
accordance with its applicable policies as in effect from time to time. Notices to be given to holders of debt securities not in global form will be sent by mail to the respective addresses of the holders as they appear in the trustee’s
records, and will be deemed given when mailed. Neither the failure to give any notice to a particular holder, nor any defect in a notice given to a particular holder, will affect the sufficiency of any notice given to another holder.
Book-entry and other indirect owners should consult their banks or brokers for information on how they will receive notices.
No protection in the event of a change of control
Unless we
state otherwise in the applicable prospectus supplement, the debt securities will not contain any provisions which may afford holders of the debt securities protection in the event we have a change in control or in the event of a highly leveraged
transaction (whether or not such transaction results in a change in control) which could adversely affect holders of debt securities.
No personal
liability of directors, officers, employees or stockholders
None of our past, present or future directors, officers, employees or stockholders, as
such, will have any liability for any of our obligations under the debt securities or the indenture or for any claim based on, or in respect or
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by reason of, such obligations or their creation. By accepting a debt security, each holder waives and releases all such liability. This waiver and release is part of the consideration for the
issue of the debt securities. However, this waiver and release may not be effective to waive liabilities under U.S. federal securities laws, and it is the view of the SEC that such a waiver is against public policy.
Our relationship with the trustee
The prospectus supplement
for your debt security will describe any material relationships we may have with the trustee with respect to that debt security. The trustee under our existing indentures is an affiliate of one of a number of banks with which we maintain ordinary
banking relationships.
The same financial institution may initially serve as the trustee for our senior debt securities and subordinated debt
securities. Consequently, if an actual or potential event of default occurs with respect to any of these securities, the trustee may be considered to have a conflicting interest for purposes of the Trust Indenture Act of 1939. In that case, the
trustee may be required to resign under one or more of the indentures, and we would be required to appoint a successor trustee. For this purpose, a “potential” event of default means an event that would be an event of default if the
requirements for giving us a default notice or for the default having to exist for a specific period of time were disregarded.
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Description of capital stock
As of the date of this prospectus, we are authorized to issue up to 150,000,000 shares of common stock of $.001 par value, and 75,000,000 shares of preferred stock, par value $.001 per share. As of June 24, 2015,
there were 49,955,026 shares of common stock issued and outstanding and no shares of preferred stock issued and outstanding.
The following summary of
certain provisions of our capital stock does not purport to be complete and is not intended to give full effect to provisions of statutory or common law. The summary is subject to and is qualified in its entirety by reference to all the provisions
of our amended and restated certificate of incorporation and amended and restated bylaws, copies of which are filed as exhibits to the registration statement of which this prospectus is a part, and by the provisions of applicable law.
Common stock
Each share of common stock is entitled to one
vote on all matters presented to the holders of common stock. Cumulative voting is not allowed in the election of directors or for any other purpose, and the holders of common stock have no preemptive rights, redemption rights or rights of
conversion with respect to the common stock. All outstanding shares of common stock are fully paid and nonassessable. The holders of common stock are entitled to receive dividends when, as and if declared by our board of directors, out of funds
legally available for their payment subject to the rights of holders of any preferred stock outstanding. Upon the liquidation, dissolution or winding up of our company, the holders of our common stock are entitled to receive ratably our net assets
available after the payment of all debts and other liabilities and subject to the prior rights of any outstanding preferred stock. Our board of directors is authorized to issue additional shares of common stock within the limits authorized by our
amended and restated certificate of incorporation and without stockholder action.
Our common stock is listed on the New York Stock Exchange (the
“NYSE”) under the symbol “BBG.”
Preferred stock
The preferred stock may carry such relative rights, preferences and designations as may be determined by our board of directors in its sole discretion upon the issuance of any shares of preferred stock. The shares
of preferred stock could be issued from time to time by the board of directors in its sole discretion (without further approval or authorization by the stockholders), in one or more series, each of which series could have any particular distinctive
designations as well as relative rights and preferences as determined by the board of directors. The relative rights and preferences that may be determined by the board of directors in its discretion from time to time, include but are not limited to
the following:
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the rate of dividend and whether the dividends are to be cumulative and the priority, if any, of dividend payments relative to other series in the class;
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whether the shares of any such series may be redeemed, and if so, the redemption price and the terms and conditions of redemption;
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the amount payable with respect to such series in the event of voluntary or involuntary liquidation; the priority, if any, of each series relative to other
series in the class with respect to amounts payable upon liquidation; and the sinking fund provisions, if any, for the redemption or purchase of the shares of that series; and
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the terms and conditions, if any, on which the shares of a series may be converted into or exchanged for shares of any class, whether common or preferred, or
into shares of any series of the same class, and if provision is made for conversion or exchange, the times, prices, rates, adjustments and other terms.
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The existence of authorized but unissued shares of preferred stock could have anti-takeover effects because we could issue preferred stock with special dividend or voting rights that could discourage potential
bidders.
As a result, the Company may issue shares of preferred stock that have dividend, voting and other rights superior to those of the common stock,
or that convert into shares of common stock, without the approval of the holders of common stock. This could result in the dilution of the voting rights, ownership and liquidation value of current stockholders.
Anti-takeover effects of delaware law, our amended and restated certificate of incorporation and amended and restated bylaws
General
Our amended and restated certificate of
incorporation and amended and restated bylaws contain the following additional provisions, some of which are intended to enhance the likelihood of continuity and stability in the composition of our board of directors and in the policies formulated
by our board of directors. In addition, some provisions of the Delaware General Corporation Law (“DGCL”), if applicable to us, may hinder or delay an attempted takeover without prior approval of our board of directors. Provisions of the
DGCL and of our amended and restated certificate of incorporation and amended and restated bylaws could discourage attempts to acquire us or remove incumbent management even if some or a majority of our stockholders believe this action is in their
best interest. These provisions could, therefore, prevent stockholders from receiving a premium over the market price for the shares of common stock they hold. However, we no longer have a classified board of directors.
Filling board of directors vacancies; removal
Our
amended and restated bylaws provide that newly created directorships resulting from any increase in the authorized number of directors and vacancies may be filled by the affirmative vote of a majority of our directors then in office, though less
than a quorum.
Our directors may be removed, with or without cause, by the affirmative vote of a majority of the shares entitled to vote at an election
of directors, if notice of the intention to act upon such matter is given in the notice calling such meeting.
No stockholder action by written
consent
Our amended and restated certificate of incorporation precludes stockholders from initiating or effecting any action by written consent
and thereby taking actions opposed by the board of directors.
Call of special meetings
Our amended and restated bylaws provide that special meetings of our stockholders may be called at any time only by the board of directors acting pursuant to a
resolution adopted by the board and not the stockholders.
Advance notice requirements for stockholder proposals and director nominations
Our amended and restated bylaws provide that stockholders seeking to bring business before or to nominate candidates for election as directors
at an annual meeting of stockholders must provide timely notice of their
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proposal in writing to the corporate secretary. To be timely, a stockholder’s notice must be delivered to our corporate secretary at our principal executive offices no later than the 60th
day or earlier than the 90th day before the first anniversary of the preceding year’s annual meeting. If, however, no meeting was held in the prior year or the date of the annual meeting has been changed by more than 30 days from the date
contemplated in the notice of annual meeting, notice by the stockholder in order to be timely must be received no later than the close of business on the 90th day before the annual meeting or the tenth day following the day on which the date of the
annual meeting is publicly announced. Our amended and restated bylaws also specify requirements as to the form and content of a stockholder’s notice. These provisions may preclude stockholders from bringing matters before an annual meeting of
stockholders or from making nominations for directors at an annual meeting of stockholders or may discourage or defer a potential acquirer from conducting a solicitation of proxies to elect its own slate of directors or otherwise attempting to
obtain control of us.
No cumulative voting
The DGCL provides that stockholders are not entitled to cumulate votes in the election of directors unless our certificate of incorporation provides otherwise. Our
amended and restated certificate of incorporation does not expressly provide for cumulative voting. Under cumulative voting, a minority stockholder holding a sufficient percentage of a class of shares may be able to ensure the election of one or
more directors.
Authorized but unissued shares
Our amended and restated certificate of incorporation provides that the authorized but unissued shares of common stock and preferred stock are available for future issuance without stockholder approval, subject to
various limitations imposed by the NYSE. These additional shares may be utilized for a variety of corporate purposes, including future public offerings to raise additional capital, corporate acquisitions and employee benefit plans. The existence of
authorized but unissued shares of common stock and preferred stock could make it more difficult or discourage an attempt to obtain control of our Company by means of a proxy contest, tender offer, merger or otherwise.
Delaware anti-takeover statute
We are subject to
Section 203 of the DGCL, an anti-takeover law. In general, this section prevents certain Delaware corporations under certain circumstances from engaging in a “business combination” with an “interested stockholder”
(generally, a holder of 15% or more of the outstanding voting stock of the corporation). A “business combination” includes a merger or sale of 10% or more of our assets. However, the above provisions of Section 203 do not apply if
(1) our board approves the transaction; (2) after the completion of the transaction that resulted in the stockholder becoming an “interested stockholder,” that stockholder owned at least 85% of our voting stock outstanding at the
time the transaction commenced, excluding shares owned by our officers and directors and certain employee benefit plans; or (3) on or subsequent to the date of the transaction, the business combination is approved by our board and authorized at
a meeting of our stockholders by an affirmative vote of at least two-thirds of the outstanding voting stock not owned by the “interested stockholder.” This statute could prohibit or delay mergers or other change in control attempts, and
thus may discourage attempts to acquire us.
Transfer agent and registrar
The transfer agent and registrar for our common stock is Computershare Trust Company, N.A.
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Description of depositary shares
We may offer depositary shares (either separately or together with other securities) representing fractional shares of preferred stock of any series. In connection
with the issuance of any depositary shares, we will enter into a deposit agreement with a bank or trust company, as depositary, which will be named in the applicable prospectus supplement. Depositary shares will be evidenced by depositary receipts
issued pursuant to the related deposit agreement. Immediately following our issuance of the security related to the depositary shares, we will deposit the shares of preferred stock with the relevant depositary and will cause the depositary to issue,
on our behalf, the related depositary receipts. Subject to the terms of the deposit agreement, each owner of a depositary receipt will be entitled, in proportion to the fraction of a share of preferred stock represented by the related depositary
share, to all the rights, preferences and privileges of, and will be subject to all of the limitations and restrictions on, the preferred stock represented by the depositary receipt (including, if applicable, dividend, voting, conversion, exchange,
redemption, sinking fund, repayment at maturity, subscription and liquidation rights).
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Description of rights
We may issue rights to purchase common stock, preferred stock or other securities. These rights may be issued independently or together with any other security offered hereby and may or may not be transferable by
the stockholder receiving the rights in such offering. In connection with any offering of such rights, we may enter into a standby arrangement with one or more underwriters or other purchasers pursuant to which the underwriters or other purchasers
may be required to purchase any securities remaining unsubscribed for after such offering.
Each series of rights will be issued under a separate rights
agreement which we will enter into with a bank or trust company, as rights agent, all as set forth in the applicable prospectus supplement. The rights agent will act solely as our agent in connection with the certificates relating to the rights and
will not assume any obligation or relationship of agency or trust with any holders of rights certificates or beneficial owners of rights. We will file the rights agreement and the rights certificates relating to each series of rights with the SEC
and incorporate them by reference as an exhibit to the registration statement of which this prospectus is a part on or before the time we issue a series of rights.
The applicable prospectus supplement will describe the specific terms of any offering of rights for which this prospectus is being delivered, including the following:
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the date of determining the stockholders entitled to the rights distribution;
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the number of rights issued or to be issued to each stockholder;
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the exercise price payable for each share of common stock, preferred stock or other securities upon the exercise of the rights;
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the number and terms of the shares of common stock, preferred stock or other securities which may be purchased per each right;
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the extent to which the rights are transferable;
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the date on which the holder’s ability to exercise the rights shall commence, and the date on which the rights shall expire;
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the extent to which the rights may include an over-subscription privilege with respect to unsubscribed securities;
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if applicable, the material terms of any standby underwriting or purchase arrangement entered into by us in connection with the offering of such rights; and
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any other terms of the rights, including the terms, procedures, conditions and limitations relating to the exchange and exercise of the rights.
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The description in the applicable prospectus supplement of any rights that we may offer will not necessarily be complete and will be
qualified in its entirety by reference to the applicable rights certificate, which will be filed with the SEC.
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Description of securities warrants
We may issue securities warrants for the purchase of debt securities, preferred stock, depositary shares or common stock. Securities warrants may be issued
independently or together with debt securities, preferred stock, depositary shares or common stock offered by any prospectus supplement and may be attached to or separate from any such offered securities. Each series of securities warrants will be
issued under a separate warrant agreement to be entered into between us and a bank or trust company, as warrant agent, all as set forth in a prospectus supplement relating to the particular issue of securities warrants. The securities warrant agent
will act solely as our agent in connection with the securities warrants and will not assume any obligation or relationship of agency or trust for or with any holders of securities warrants or beneficial owners of securities warrants.
The following is a summary of certain general terms and provisions of the warrants, but they are not complete and are subject to, and are qualified in their
entirety by reference to, the warrant agreement and the warrant certificate relating to the warrants. Forms of these documents will be filed as exhibits to the registration statement of which this prospectus is a part, either by an amendment to the
registration statement or by a Current Report on Form 8-K.
A prospectus supplement relating to a particular issue of securities warrants will contain
the terms of and information relating to that issue of securities warrants, including, where applicable:
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the designation, aggregate principal amount, currencies, denominations and terms of the series of debt securities purchasable upon exercise of securities
warrants to purchase debt securities and the price at which such debt securities may be purchased upon such exercise;
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the number of shares of common stock purchasable upon the exercise of securities warrants to purchase common stock and the price at which such number of shares
of common stock may be purchased upon such exercise;
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the number of shares and series of preferred stock or depositary shares purchasable upon the exercise of securities warrants to purchase preferred stock or
depositary shares and the price at which such number of shares of such series of preferred stock or depositary shares may be purchased upon such exercise;
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the date on which the right to exercise such securities warrants shall commence and the date on which such right shall expire;
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U.S. federal income tax consequences applicable to such securities warrants;
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the amount of securities warrants outstanding as of the most recent practicable date; and
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any other terms of such securities warrants.
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Securities warrants will be issued in registered form only. The exercise price for securities warrants will be subject to adjustment in accordance with a prospectus
supplement relating to the particular issue of securities warranties.
Each securities warrant will entitle the holder thereof to purchase such principal
amount of debt securities or such number of shares of common stock, preferred stock or depositary shares at such exercise price as shall in each case be set forth in, or calculable from, a prospectus supplement relating to the securities warrants,
which exercise price may be subject to adjustment upon the occurrence of certain events as set forth in such prospectus supplement. After the close of business on the expiration date, or such later date to which such expiration date may be extended
by us, unexercised securities warrants will become void. The place or places where, and the manner in which, securities warrants may be exercised shall be specified in a prospectus supplement relating to such securities warrants.
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Prior to the exercise of any securities warrants to purchase debt securities, common stock, preferred stock or
depositary shares, holders of such securities warrants will not have any of the rights of holders of debt securities, common stock, preferred stock or depositary shares, as the case may be, purchasable upon such exercise, including the right to
receive payments of principal of, premium, if any, or interest, if any, on the debt securities purchasable upon such exercise or to enforce covenants in any applicable indenture, or to receive payments of dividends, if any, on the common stock,
preferred stock or depositary shares purchasable upon such exercise, or to exercise any applicable right to vote.
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Description of stock purchase contracts and stock purchase units
We may issue stock purchase contracts, including contracts obligating holders to purchase from us, and obligating us to sell to holders, a specified number of
shares of common stock or other securities offered hereby at a future date or dates, which we refer to in this prospectus as “stock purchase contracts.” The price per share of the securities and the number of shares of the securities may
be fixed at the time the stock purchase contracts are issued or may be determined by reference to a specific formula set forth in the stock purchase contracts. The stock purchase contracts may be issued separately or as part of units consisting of a
stock purchase contract and debt securities, preferred securities, warrants or other securities that are registered hereunder, securing the holders’ obligations to purchase the securities under the stock purchase contracts, which we refer to
herein as “stock purchase units.” The stock purchase contracts may require holders to secure their obligations under the stock purchase contracts in a specified manner. The stock purchase contracts also may require us to make periodic
payments to the holders of the stock purchase units or vice versa, and those payments may be unsecured or refunded on some basis. The purchase contracts may be convertible into or exercisable for common or preferred stock or other securities of ours
or debt or equity securities of one or more other entities.
An accompanying prospectus supplement will describe the terms of the stock purchase
contracts or stock purchase units and, if applicable, collateral or depositary arrangements relating to the stock purchase contracts or stock purchase units. Material United States federal income tax considerations applicable to the stock purchase
units and the stock purchase contracts will also be discussed in the applicable prospectus supplement.
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Plan of distribution
We may sell the securities from time to time pursuant to underwritten public offerings, negotiated transactions, block trades or a combination of these methods or through underwriters or dealers, through agents,
directly to one or more purchasers or through any other method permitted by law. The securities may be distributed from time to time in one or more transactions:
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at a fixed price or prices, which may be changed;
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at market prices prevailing at the time of sale;
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at prices related to such prevailing market prices; or
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Each time that we sell
securities covered by this prospectus, we will provide a prospectus supplement or supplements that will describe the method of distribution and set forth the terms and conditions of the offering of such securities, including the offering price of
the securities and the proceeds to us.
Offers to purchase the securities being offered by this prospectus may be solicited directly. Agents may also be
designated to solicit offers to purchase the securities from time to time. Any agent involved in the offer or sale of our securities will be identified in a prospectus supplement.
If a dealer is utilized in the sale of the securities being offered by this prospectus, the securities will be sold to the dealer, as principal. The dealer may then resell the securities to the public at varying
prices to be determined by the dealer at the time of resale.
If an underwriter is utilized in the sale of the securities being offered by this
prospectus, an underwriting agreement will be executed with the underwriter at the time of sale and the name of any underwriter will be provided in the prospectus supplement that the underwriter will use to make resales of the securities to the
public. In connection with the sale of the securities, we or the purchasers of securities for whom the underwriter may act as agent, may compensate the underwriter in the form of underwriting discounts or commissions. The underwriter may sell the
securities to or through dealers, and those dealers may receive compensation in the form of discounts, concessions or commissions from the underwriters and/or commissions from the purchasers for which they may act as agent. Unless otherwise
indicated in a prospectus supplement, an agent will be acting on a best efforts basis and a dealer will purchase securities as a principal, and may then resell the securities at varying prices to be determined by the dealer.
Any compensation paid to underwriters, dealers or agents in connection with the offering of the securities, and any discounts, concessions or commissions allowed by
underwriters to participating dealers will be provided in the applicable prospectus supplement. Underwriters, dealers and agents participating in the distribution of the securities may be deemed to be underwriters within the meaning of the
Securities Act, and any discounts and commissions received by them and any profit realized by them on resale of the securities may be deemed to be underwriting discounts and commissions. We may enter into agreements to indemnify underwriters,
dealers and agents against civil liabilities, including liabilities under the Securities Act, or to contribute to payments they may be required to make in respect thereof and to reimburse those persons for certain expenses.
Any shares of common stock will be listed on the NYSE or another national stock exchange, but any other securities may or may not be listed on a national securities
exchange. To facilitate the offering of securities, certain persons participating in the offering may engage in transactions that stabilize, maintain or otherwise affect the price of the securities. This may include over-allotments or short sales of
the securities, which involve the sale by persons participating in the offering of more securities than were sold to them. In these circumstances, these persons would cover such over-allotments or short positions by making purchases in the open
market or by exercising their over-allotment option, if any. In addition, these persons may stabilize or
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maintain the price of the securities by bidding for or purchasing securities in the open market or by imposing penalty bids, whereby selling concessions allowed to dealers participating in the
offering may be reclaimed if securities sold by them are repurchased in connection with stabilization transactions. The effect of these transactions may be to stabilize or maintain the market price of the securities at a level above that which might
otherwise prevail in the open market. These transactions may be discontinued at any time.
If indicated in the applicable prospectus supplement,
underwriters or other persons acting as agents may be authorized to solicit offers by institutions or other suitable purchasers to purchase the securities at the public offering price set forth in the prospectus supplement, pursuant to delayed
delivery contracts providing for payment and delivery on the date or dates stated in the prospectus supplement. These purchasers may include, among others, commercial and savings banks, insurance companies, pension funds, investment companies and
educational and charitable institutions. Delayed delivery contracts will be subject to the condition that the purchase of the securities covered by the delayed delivery contracts will not at the time of delivery be prohibited under the laws of any
jurisdiction in the United States to which the purchaser is subject. The underwriters and agents will not have any responsibility with respect to the validity or performance of these contracts.
We may engage in at-the-market offerings into an existing trading market in accordance with Rule 415(a)(4) under the Securities Act. In addition, we may enter into
derivative transactions with third parties, or sell securities not covered by this prospectus to third parties in privately negotiated transactions. If the applicable prospectus supplement so indicates, in connection with those derivatives, the
third parties may sell securities covered by this prospectus and the applicable prospectus supplement, including in short sale transactions. If so, the third party may use securities pledged by us or borrowed from us or others to settle those sales
or to close out any related open borrowings of securities, and may use securities received from us in settlement of those derivatives to close out any related open borrowings of securities. The third party in such sale transactions will be an
underwriter and, if not identified in this prospectus, will be named in the applicable prospectus supplement (or a post-effective amendment). In addition, we may otherwise loan or pledge securities to a financial institution or other third party
that in turn may sell the securities short using this prospectus and an applicable prospectus supplement. Such financial institution or other third party may transfer its economic short position to investors in our securities or in connection with a
concurrent offering of other securities.
We may also make direct sales through subscription rights distributed to our existing stockholders on a pro
rata basis, which may or may not be transferable. In any distribution of subscription rights to our stockholders, if all of the underlying securities are not subscribed for, we may then sell the unsubscribed securities directly to third parties or
may engage the services of one or more underwriters, dealers or agents, including standby underwriters, to sell the unsubscribed securities to third parties.
The specific terms of any lock-up provisions in respect of any given offering will be described in the applicable prospectus supplement.
The underwriters, dealers and agents may engage in transactions with us, or perform services for us, in the ordinary course of business for which they receive compensation.
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Legal matters
The validity of the securities in respect of which this prospectus is being delivered will be passed on for us by Akin Gump Strauss Hauer & Feld, LLP. The validity of certain of the offered securities and other
matters arising under Colorado law will be passed on for us by Kenneth A. Wonstolen, our Senior Vice President—General Counsel. Mr. Wonstolen beneficially owns 13,630 shares of our common stock as of June 24, 2015. Additional legal matters may
be passed on for us, or for any underwriters, dealers or agents, by counsel we will name in the applicable prospectus supplement.
Experts
The financial statements incorporated in this prospectus by reference from the Company’s Annual Report on Form 10-K and the
effectiveness of the Company’s internal control over financial reporting have been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their reports, which are incorporated herein by reference.
Such financial statements have been so incorporated in reliance upon the reports of such firm given upon their authority as experts in accounting and auditing.
Certain information regarding our estimates of the oil and gas reserves associated with our oil and gas prospects incorporated by reference in this prospectus is reviewed by Netherland, Sewell &
Associates, Inc., an independent petroleum engineering firm. The description of the review of such estimates is incorporated by reference into this prospectus upon the authority of said firm as an expert in these matters.
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21,000,000 shares
Common stock
Prospectus supplement
Sole Bookrunner
J.P. Morgan
Co-managers
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BofA Merrill Lynch
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BMO Capital Markets
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Citigroup
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Deutsche Bank Securities
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Scotia Howard Weil
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Wells Fargo Securities
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December 5, 2017