Business Context and Reporting Period
This Form 8-K is filed by Midstates Petroleum Company, Inc. (not Amplify Energy Corp.) for the period ending February 3, 2016. The filing reports two material events: the full utilization of the company's credit facility and the delisting of its common stock from the New York Stock Exchange (NYSE).
Key Financial Metrics
- Debt: On February 4, 2016, the company borrowed approximately $249.2 million, representing the remaining undrawn amount of its Credit Facility. As of February 9, 2016, total borrowings under the facility were approximately $252.0 million, including $2.8 million in outstanding letters of credit.
- Liquidity: Following the funding of the new borrowing, the company's cash balance was approximately $335.7 million as of February 9, 2016.
- Interest Rates: Borrowings bear interest at the alternative base rate plus a margin of 1.0% to 2.0%, or LIBOR plus a margin of 2.0% to 3.0%, depending on borrowing base utilization.
- Revenue and Profit: The filing text does not provide a clear value for revenue, profit, or cash flow metrics.
Material Changes
- Capital Structure: The company moved from having available credit capacity to fully utilizing its $252.0 million Credit Facility for general corporate purposes.
- Listing Status: The company was notified by the NYSE on February 3, 2016, that its average global market capitalization fell below the $15 million threshold required for continued listing. Trading on the NYSE was suspended, and the company elected not to appeal the delisting.
- Trading Venue: Effective February 4, 2016, the company's common stock began trading on the OTC Pink marketplace under the symbol "MPOY."
Outlook, Risks, and Management Commentary
- Market Liquidity Risk: Management provided no assurance that the stock will continue to trade on the OTC Pink marketplace, that broker-dealers will provide public quotes, or that trading volume will be sufficient for an efficient market.
- Quote Blocking Risk: There is a risk that quotes for the common stock may be blocked by OTC Markets Group in the future.
- Management Action: The company explicitly stated it does not intend to appeal the NYSE delisting determination.
Investor Verification Checklist
- Verify the current trading status and liquidity of the stock on the OTC Pink marketplace under symbol "MPOY."
- Confirm the company's current borrowing base utilization and any potential restrictions on further borrowing.
- Review subsequent filings for updates on the company's market capitalization and efforts to regain a national exchange listing.
- Assess the impact of the delisting on the company's ability to raise additional capital or meet debt covenants.