8-K 1 cpr8krbc06022014.htm 8-K CPR 8K RBC 06022014


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 8-K
 
CURRENT REPORT
Pursuant to Section 13 or Section 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): June 2, 2014
  
CHAPARRAL ENERGY, INC.
(Exact name of registrant as specified in its charter)
 
 
 
 
 
 
Delaware
 
333-134748
 
73-1590941
(State or other jurisdiction
of incorporation)
 
(Commission
File Number)
 
(IRS Employer
Identification No.)
 
 
 
701 Cedar Lake Boulevard
Oklahoma City, OK
 
73114
(Address of principal executive offices)
 
(Zip Code)
Registrant's telephone number, including area code: (405) 478-8770
Not Applicable
(Former name or former address, if changed since last report)
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
o
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
o
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
o
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
o
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))



Item 7.01.
Regulation FD Disclosure.
On June 2, 2014, Chaparral Energy, Inc. (referred to herein as “we”, “us,” and “our”) presented the slide show, attached hereto as Exhibit 99.1 and incorporated herein by reference, at the 2014 RBC Capital Markets' Global Energy Conference in New York, New York.
Note Regarding Non-GAAP Financial Measures
The investor presentation attached as an exhibit hereto contains certain references to adjusted EBITDA value, which is a non-GAAP financial measure, as defined under Regulation G of the rules and regulations of the SEC.
Adjusted EBITDA
Management uses adjusted EBITDA as a supplemental financial measurement to evaluate our operational trends. Items excluded generally represent non-cash adjustments, the timing and amount of which cannot be reasonably estimated and are not considered by management when measuring our overall operating performance. In addition, adjusted EBITDA is generally consistent with the Consolidated EBITDAX calculation that is used in the covenant ratio required under our senior secured revolving credit facility as described in the Management’s Discussion and Analysis of Financial Condition and Results of Operations section in our Quarterly Report on Form 10-Q for the three months ended March 31, 2014. We consider compliance with this covenant to be material. The calculation of Consolidated EBITDAX includes pro forma adjustments for property acquisitions and dispositions, and as a result of these adjustments, our Consolidated EBITDAX as calculated for covenant compliance purposes is higher than our adjusted EBITDA for the year ended December 31, 2013 and for the four consecutive fiscal quarters ending ending March 31, 2014.
Adjusted EBITDA is used as a supplemental financial measurement in the evaluation of our business and should not be considered as an alternative to net income, as an indicator of our operating performance, as an alternative to cash flows from operating activities, or as a measure of liquidity. Adjusted EBITDA is not defined under GAAP and, accordingly, it may not be a comparable measurement to those used by other companies.
We define adjusted EBITDA as net income (loss), adjusted to exclude (1) interest and other financing costs, net of capitalized interest, (2) income taxes, (3) depreciation, depletion and amortization, (4) unrealized (gain) loss on ineffective portion of hedge reclassification adjustments, (5) non-cash change in fair value of non-hedge derivative instruments, (6) interest income, (7) stock-based compensation expense, (8) gain or loss on disposed assets, and (9) impairment charges and other significant, unusual non-cash charges.


 

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The following table provides a reconciliation of our net income (loss) to adjusted EBITDA for the specified periods:

 
 
Three months ended March 31,
 
Year ended December 31,
(in thousands)
 
2014
 
2013
 
2012
 
2011
 
2010
 
2009
Net income (loss)
 
$
4,405

 
$
55,687

 
$
64,403

 
$
42,048

 
$
33,713

 
$
(144,318
)
Interest expense
 
26,459

 
96,876

 
98,402

 
96,720

 
81,370

 
90,102

Income tax expense (benefit)
 
2,635

 
32,849

 
37,837

 
35,924

 
23,803

 
(85,936
)
Depreciation, depletion, and amortization
 
55,750

 
192,426

 
169,307

 
146,083

 
109,503

 
104,734

Reclassification adjustment for hedge (gains) losses
 
—

 
(37,134
)
 
(46,746
)
 
27,452

 
23,889

 
(21,752
)
Non-cash change in fair value of non-hedge derivative instruments
 
20,278

 
40,748

 
(12,411
)
 
(57,899
)
 
(2,523
)
 
149,106

Proceeds from monetization of derivatives with a scheduled maturity date more than 12 months from the monetization date included in EBITDA (1)
 
—

 
—

 
—

 
—

 
9,418

 
—

Proceeds from monetization of derivatives with a scheduled maturity date more than 12 months from the monetization date excluded from EBITDA (1)
 
—

 
—

 
—

 
—

 
—

 
(102,352
)
Amortization of put premium
 
166

 
—

 
—

 
—

 
—

 
—

Interest income
 
(15
)
 
(254
)
 
(225
)
 
(165
)
 
(144
)
 
(283
)
Stock-based compensation expense
 
1,238

 
4,933

 
3,065

 
3,747

 
2,600

 
1,145

Gain on disposed assets
 
(84
)
 
(670
)
 
(149
)
 
(1,284
)
 
(184
)
 
(10,463
)
Loss on extinguishment of debt
 
—

 
—

 
21,714

 
20,592

 
2,241

 
—

Loss on impairment of other assets
 
—

 
3,490

 
2,000

 
—

 
—

 
240,790

Other non-cash charges
 
—

 
—

 
—

 
—

 
4,150

 
2,928

Adjusted EBITDA
 
$
110,832

 
$
388,951

 
$
337,197

 
$
313,218

 
$
287,836

 
$
223,701

________________
(1)  Through March 31, 2010, our calculation of adjusted EBITDA excluded any cash proceeds received from the monetization of derivatives with a scheduled maturity date more than 12 months following the date of such monetization.


Item 9.01.
Financial Statements and Exhibits.
 
 
(d)
Exhibits.
 
 
 
 
Exhibit
Number
 
Description
 
 
 
99.1
 
Investor Presentation


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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 

 
 
 
 
 
 
 
 
June 2, 2014
 
 
 
 
 
 
 
 
 
 
 
By:
 
/s/    JOSEPH O. EVANS        
 
 
 
 
 
Name:
 
Joseph O. Evans
 
 
 
 
 
Title:
 
Chief Financial Officer and Executive Vice President
 

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Exhibit Index
 

 
 
 
Exhibit
Number
 
Description
 
 
 
99.1
 
Investor Presentation



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