Concho Resources Inc. Announces Tender Offer and Consent Solicitation for
Its 8.625% Senior Notes Due 2017
MIDLAND, Texas -- May 20, 2013
Concho Resources Inc. (NYSE: CXO) (“Concho” or the “Company”) announced today
that it has commenced a cash tender offer (the “Offer”) to purchase any and
all of its $300 million in outstanding aggregate principal amount of 8.625%
Senior Notes due 2017 (CUSIP 20605PAA9) (the “8.625% Notes”). In connection
with the Offer, the Company is soliciting consents (the “Consent
Solicitation”) to proposed amendments that would shorten to three business
days the minimum notice period for optional redemptions and would eliminate
most of the restrictive covenants and certain default provisions contained in
the indenture governing the 8.625% Notes (the “Indenture”).
The Offer is scheduled to expire at 11:59 p.m., New York City time, on June
17, 2013, unless extended or earlier terminated (the “Expiration Time”).
Holders who validly tender their 8.625% Notes and provide their consents to
the amendments to the Indenture before 5:00 p.m., New York City time, on June
3, 2013, unless extended (the “Consent Expiration”), will be eligible to
receive the Total Consideration (as defined below). The Offer contemplates an
early settlement option, so that holders whose 8.625% Notes are validly
tendered prior to the Consent Expiration and accepted for purchase could
receive payment on an initial settlement date, which is expected to be as
early as June 4, 2013. Tenders of 8.625% Notes may be validly withdrawn and
consents may be validly revoked until the Withdrawal Time (defined below).
Holders who validly tender their 8.625% Notes after the Consent Expiration and
prior to the Expiration Time will be eligible to receive the Tender Offer
Consideration (defined below) on the final settlement date, which is expected
to be June 18, 2013.
The “Total Consideration” for each $1,000 principal amount of 8.625% Notes
validly tendered and not validly withdrawn prior to the Consent Expiration is
$1,069.22, which includes a consent payment of $30.00 per $1,000 principal
amount of 8.625% Notes. Holders tendering after the Consent Expiration will be
eligible to receive only the “Tender Offer Consideration,” which is $1,039.22
for each $1,000 principal amount of 8.625% Notes, and does not include a
consent payment. Holders whose 8.625% Notes are purchased in the Offer will
also receive accrued and unpaid interest from the most recent interest payment
date for the 8.625% Notes up to, but not including, the applicable payment
In connection with the Offer, the Company is soliciting consents to certain
proposed amendments to the Indenture. Holders may not tender their 8.625%
Notes without delivering consents or deliver consents without tendering their
8.625% Notes. No consent payments will be made in respect of 8.625% Notes
tendered after the Consent Expiration. Following receipt of the consent of
holders of a majority in aggregate principal amount of the 8.625% Notes, the
Company will execute a supplemental indenture to amend the Indenture to
eliminate substantially all of the restrictive covenants and certain events of
default in the Indenture.
Tendered 8.625% Notes may be withdrawn and consents may be revoked before 5:00
p.m., New York City time, on June 3, 2013, unless extended (the “Withdrawal
Time”), but generally not afterwards, unless required by law. Any extension or
termination of the Offer will be followed as promptly as practicable by a
public announcement thereof.
The Offer is subject to the satisfaction of certain conditions including: (1)
receipt of consents to the amendments to the Indenture from holders of a
majority in principal amount of the outstanding 8.625% Notes governed by the
Indenture, (2) execution of a supplemental indenture effecting the amendments,
(3) consummation of the capital markets debt financing announced today raising
proceeds on terms satisfactory to the Company in an amount sufficient to fund
the Offer and (4) certain other customary conditions.
The complete terms and conditions of the Offer are described in the Offer to
Purchase and Consent Solicitation Statement dated May 20, 2013, copies of
which may be obtained from D.F. King & Co., Inc., the tender agent and
information agent for the Offer, by calling (800) 967-4612 (US toll-free) or
(212) 269-5550 (collect) or by emailing firstname.lastname@example.org.
The Company has also retained BofA Merrill Lynch as dealer manager for the
Offer and solicitation agent for the Consent Solicitation. Questions regarding
the terms of the Offer and Consent Solicitation may be directed to BofA
Merrill Lynch, Attention: Liability Management Group at telephone: (888)
292-0070 (US toll-free) or (980) 387-3907 (collect).
This announcement is not an offer to purchase, a solicitation of an offer to
sell or a solicitation of consents with respect to any securities. The Offer
is being made solely by the Offer to Purchase and Consent Solicitation
Statement dated May 20, 2013. The Offer is not being made to holders of 8.625%
Notes in any jurisdiction in which the making or acceptance thereof would not
be in compliance with the securities, blue sky or other laws of such
Forward-Looking Statements and Cautionary Statements
The foregoing contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. All statements, other than statements of historical
facts, included in this press release that address activities, events or
developments that the Company expects, believes or anticipates will or may
occur in the future are forward-looking statements. Without limiting the
generality of the foregoing, forward-looking statements contained in this
press release specifically include statements, estimates and projections
regarding the Company's future financial position, operations, performance,
production growth, returns, divestitures, capital expenditure budget, the
timing and estimated proceeds of the closing of the sale of the non-core
properties, oil and natural gas reserves, number of identified drilling
locations, drilling program, derivative activities, costs and other guidance.
These statements are based on certain assumptions made by the Company based on
management's experience, expectations and perception of historical trends,
current conditions, anticipated future developments and other factors believed
to be appropriate. Forward-looking statements are not guarantees of
performance. Although the Company believes the expectations reflected in its
forward-looking statements are reasonable and are based on reasonable
assumptions, no assurance can be given that these assumptions are accurate or
that any of these expectations will be achieved (in full or at all) or will
prove to have been correct. Moreover, such statements are subject to a number
of assumptions, risks and uncertainties, many of which are beyond the control
of the Company, which may cause actual results to differ materially from those
implied or expressed by the forward-looking statements. These include the
factors discussed or referenced in the “Risk Factors” section of the Company's
most recent Form 10-K and 10-Q filings and risks relating to declines in the
prices Concho receives for the Company's oil and natural gas; uncertainties
about the estimated quantities of reserves; risks related to the integration
of acquired assets; the effects of government regulation, permitting and other
legal requirements, including new legislation or regulation of hydraulic
fracturing; drilling and operating risks; the adequacy of the Company's
capital resources and liquidity; risks related to the concentration of the
Company's operations in the Permian Basin; the results of the Company's
hedging program; weather; litigation; shortages of oilfield equipment,
services and qualified personnel and increases in costs for such equipment,
services and personnel; uncertainties about the Company's ability to replace
reserves and economically develop the Company's current reserves; competition
in the oil and natural gas industry; and other important factors that could
cause actual results to differ materially from those projected.
Any forward-looking statement speaks only as of the date on which such
statement is made, and the Company undertakes no obligation to correct or
update any forward-looking statement, whether as a result of new information,
future events or otherwise, except as required by applicable law.
About Concho Resources Inc.
Concho Resources Inc. is an independent oil and natural gas company engaged in
the acquisition, development and exploration of oil and natural gas
properties. The Company's operations are focused in the Permian Basin of
Southeast New Mexico and West Texas.
Concho Resources Inc.
Price Moncrief, 432-683-7443
Vice President of Capital Markets and Strategy
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