Oasis Petroleum tenders for $275 million of notes from four series

By Marisa Wong

Morgantown, W.Va., Sept. 13 – Oasis Petroleum Inc. announced it has begun tender offers to purchase four series of its outstanding senior notes for an aggregate cash consideration of up to $275 million, exclusive of accrued interest on all purchased notes.

The outstanding notes are Oasis’ $399 million of 7¼% senior notes due 2019, $397,697,000 of 6½% senior notes due 2021, $940.5 million of 6 7/8% senior notes due 2022 and $378.2 million of 6 7/8% senior notes due 2023.

The tender offers consist of a fixed-price tender offer to purchase the 2019 notes and a modified Dutch auction offer to purchase the 2021, 2022 and 2023 notes.

The amount of 2019 notes to be purchased in the fixed-price offer will be based on the $275 million maximum tender cap.

The maximum aggregate cash consideration for the Dutch auction offer will be the maximum tender cap less the aggregate purchase price of the 2019 notes purchased in the fixed-price offer.

The amount of notes to be purchased under either offer may be subject to proration.

The offers will expire at 11:59 p.m. ET on Oct. 11.

Notes tendered by 5 p.m. ET on Sept. 26, the early participation date, will have priority in acceptance over notes of any series tendered after the early participation date. Holders who tender their notes prior to the early participation date will be eligible to receive the total consideration, which includes an early participation amount of $30 per $1,000 principal amount of notes accepted for purchase.

The total consideration for each $1,000 principal amount of 2019 notes is $1,016.25. The bid range for each $1,000 principal amount of the other three series is $932.50 to $962.50 for the 2021 notes, $920.00 to $950.00 for the 2022 notes and $932.50 to $962.50 for the 2023 notes.

Holders who tender their notes after the early participation date and prior to the expiration date will only be eligible to receive the total consideration less the early participation amount.

In addition, holders whose notes are accepted for purchase will receive a cash payment for any accrued interest up to, but not including, the applicable payment date. The final payment date will occur right after the expiration date.

Following the early participation date, Oasis may choose to accept for purchase early any notes tendered prior to the early participation date, subject to the maximum tender cap and the Dutch auction tender cap. The early payment date is expected to occur on Sept. 27.

If, on the early payment date, the aggregate principal amount of 2019 notes accepted for purchase would result in an aggregate payment amount equal to the maximum tender cap, Oasis will not accept any 2021, 2022 or 2023 notes tendered prior to the early participation date or any notes of any series tendered after that.

Tendered notes may be withdrawn at any time prior to 5 p.m. ET on Sept. 26.

The tender offers are conditioned on Oasis receiving sufficient proceeds from an offering of new notes, together with cash on hand and, if necessary, available borrowings under its revolving credit facility, to fund the offers. Oasis announced an offering of convertible senior notes on Tuesday.

RBC Capital Markets, LLC (877 381-2099 or 212 618-7822) is the dealer manager for the tender offers, and D.F. King & Co., Inc. (877 871-1741 or 212 269-5550 or oasispetroleum@dfking.com) is the information agent.

Oasis is a Houston-based oil and natural gas company.

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