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| PLLL > SEC Filings for PLLL > Form 8-K on 15-Oct-2009 | All Recent SEC Filings |
15-Oct-2009
Entry into a Material Definitive Agreement, Other Events, Financial State
On October 13, 2009, Parallel Petroleum Corporation, a Delaware corporation (the "Company"), entered into Amendment No. 1 to Agreement and Plan of Merger (the "Merger Amendment") with PLLL Holdings, LLC, a Delaware limited liability company ("Parent"), and PLLL Acquisition Co., a Delaware corporation and a wholly owned subsidiary of Parent ("Merger Subsidiary"), pursuant to which the parties to the Merger Amendment agreed to reduce the $5.5 million termination fee payable by the Company to Parent in the event of certain termination events under the Agreement and Plan of Merger, dated as of September 15, 2009 (the "Merger Agreement"), to $4.0 million plus the payment of certain expenses not to exceed $1,000,000 in the aggregate. In addition, the parties to the Merger Amendment agreed to decrease the period in which the Company is required to pay the termination fee to Parent if, after the termination of the Merger Agreement, the Company consummates a merger, acquisition, recapitalization or similar transaction as described in the Merger Agreement. The period has been reduced from twelve months to nine months.
The foregoing summary of the Merger Amendment and the terms set forth therein does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Merger Amendment attached as Exhibit 2.1 hereto and incorporated herein by reference.
On October 13, 2009, the defendants and the plaintiffs in the lawsuits set forth
below entered into a Memorandum of Understanding (the "Memorandum") providing
for a settlement of each of the following lawsuits: In re Parallel Petroleum
Shareholder Litigation, Consolidated Civil Action No. 4922, pending in the
Chancery Court of Delaware (which action consolidates three individual suits:
Hollinger v. Parallel Petroleum Corporation, Civil Action No. 4922, Bernstein v.
Parallel Petroleum Corporation, Civil Action No. 4938, and Harris v. Parallel
Petroleum Corporation, Civil Action No. 4942); Passerella v. Oldham, et al., No.
CV47099, pending in the District Court of Midland County, Texas, 385th Judicial
District; and Stratton v. Parallel Petroleum Corporation, et al., pending in the
District Court of Harris County, Texas, 127th Judicial District. As part of the
settlement, the Company agreed to make certain supplemental disclosures to its
solicitation/recommendation statement on Schedule 14D-9, which disclosures are
included in an amendment to the solicitation/recommendation statement on
Schedule 14D-9 filed by the Company with the SEC on October 13, 2009. The
Memorandum contains no admission of wrongdoing.
The Memorandum provides, among other things, that: (i) the defendants agree
to execute the Merger Amendment as described in Item 1.01 above; (ii) the
Company file an amendment to its solicitation/recommendation statement on
Schedule 14D-9 that provides enhanced disclosure in form and substance similar
to the disclosure recommendations set forth in an attachment to the Memorandum;
(iii) the plaintiffs agree to dismiss all claims against the defendants in the
lawsuits; (iv) the defendants and the plaintiffs agree upon and execute a
stipulation of settlement (the "Stipulation"), which will replace the
Memorandum, and will submit the Stipulation to the appropriate courts for
review; (v) the Stipulation include a general release to the defendants and
others of all claims; (vi) the defendants and the plaintiffs negotiate in good
faith regarding an agreed to fee in connection with the lawsuits and the
settlement thereof; (vii) the Memorandum and the Stipulation be conditioned upon
class certification and final approval by the appropriate court or courts; and
(viii) neither the Memorandum nor any of the terms of the Stipulation constitute
an admission of the validity of any claim against the defendants, or the
liability of any defendant, and the Memorandum and the Stipulation may not be
used in any proceeding for any purpose (other than to enforce the terms set
forth therein). In addition, the Memorandum provides that if for any reason the
settlement outlined therein is not approved by the appropriate court or courts,
is terminated or otherwise does not become effective then: (a) the attempted
settlement will have been without prejudice, and none of its terms will be
effective or enforceable; (b) the parties to the Memorandum will revert to their
litigation positions immediately prior to the execution of the Memorandum; and
(c) the facts and terms of the Memorandum will not be referred to or offered
into evidence in any trial relating to the lawsuits. The foregoing summary of
the material terms of the
On October 13, 2009, the Company issued a press release announcing the execution of the Memorandum and the Merger Amendment. A copy of the press release is attached hereto as Exhibit 99.2 and incorporated herein by reference.
(d) Exhibits
2.1 Amendment No. 1 to Agreement and Plan of Merger, dated as of October 13, 2009, by and among Parent, Merger Subsidiary and the Company (incorporated by reference to Exhibit (a)(13) to Amendment No. 2 to the Solicitation/Recommendation Statement on Schedule 14D-9 filed by the Company on October 13, 2009).
99.1 Memorandum of Understanding, dated as of October 13, 2009 (incorporated by reference to Exhibit (a)(16) to Amendment No. 2 to the Solicitation/Recommendation Statement on Schedule 14D-9 filed by the Company on October 13, 2009).
99.2 Press Release, dated October 13, 2009 (incorporated by reference to Exhibit (a)(18) to Amendment No. 2 to the Solicitation/Recommendation Statement on Schedule 14D-9 filed by the Company on October 13, 2009).
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