LINN Energy Board of Directors Approves Spin-Off of Riviera Resources; Sets Record and Distribution Date for Spin-Off
Following the Spin-Off and the transactions contemplated thereby, for each share of LINN common stock held on the record date (as defined below), LINN stockholders will own one share each of:
- LINN (OTC:LNGG), which will own a 50% equity interest in
Roan Resources LLC, which is focused on the accelerated development of the Merge/SCOOP/STACK play in Oklahoma; and
- Riviera (OTC:RVRA), which will be an independent oil and gas company with a strategic focus on efficiently operating its mature low-decline assets, developing its growth-oriented assets, and returning capital to shareholders. Riviera’s assets will initially consist of:
- LINN’s legacy properties located in the
Hugoton Basin, East Texas, North Louisiana, Michigan/ Illinois, the Uinta Basinand Mid-Continent regions; and Blue Mountain Midstream LLC, a midstream company centered in the core of the Merge play in the Anadarko Basin.
- LINN’s legacy properties located in the
The Spin-Off is expected to occur after the market close on
Following the Spin-Off, LINN will continue to trade on the OTCQB Market under the symbol "LNGG”, and Riviera is expected to be quoted to trade on the OTCQX Market under the symbol "RVRA".
Additional Details on the Spin-Off
The Spin-Off will be effected through a pro rata distribution of all of the outstanding shares of Riviera’s common stock to LINN stockholders of record as of
As previously disclosed, Riviera has filed with the
LINN stockholders will not be required to pay any consideration for the shares of Riviera common stock they receive in the Spin-Off, and they will not be required to surrender or exchange their shares of LINN common stock or take any other action, other than to provide any documentation that may be required as discussed under “Material U.S. Federal Income Tax Consequences of the Spin-Off” in the Registration Statement, including with respect to certain Foreign Investment in Real Property Tax Act (“FIRPTA”) documentation that may be required by the applicable withholding agent, to receive their shares of Riviera common stock.
Trading of LINN Shares and Riviera Shares
Trading of shares of Riviera common stock is expected to begin on a date to be determined after
Stockholders are encouraged to consult with their brokers or financial advisors regarding the specific implications of buying or selling
Taxable Distribution and Potential Tax Withholding
The Spin-Off will be a taxable distribution. The material U.S. federal income tax consequences of the distribution are described in detail in the Registration Statement under “Material U.S. Federal Income Tax Consequences of the Spin-Off.” Information regarding tax matters in this press release is for general information purposes only and does not constitute tax advice. STOCKHOLDERS ARE ENCOURAGED TO CONSULT THEIR OWN TAX ADVISORS REGARDING THE PARTICULAR TAX CONSEQUENCES OF THE SPIN-OFF TO THEM.
With respect to the portion of the distribution treated as a return of capital,
To the extent withholding is necessary,
The distribution agent, transfer agent and registrar for Riviera’s shares will be
The completion of the Spin-Off is subject to the satisfaction or waiver of certain customary conditions, including the Registration Statement being declared effective by the Commission and other conditions described in the Registration Statement.
Statements made in this press release that are not historical facts are “forward-looking statements.” These statements are based on certain assumptions and expectations made by the Company, which reflect management’s experience, estimates and perception of historical trends, current conditions and anticipated future developments. 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 anticipated in the forward-looking statements. These include risks relating to uncertainties that may delay or negatively impact the Spin-Off or cause the Spin-Off to be delayed or to not occur at all, uncertainties related to the Company’s and Riviera' ability to realize the anticipated benefits of the Spin-Off, the potential negative effects of the Spin-Off, the availability of sufficient cash flow to execute our business plan, continued low or further declining commodity prices and demand for oil, natural gas and natural gas liquids, ability to hedge future production, ability to replace reserves and efficiently develop current reserves, the capacity and utilization of midstream facilities and the regulatory environment. These and other important factors could cause actual results to differ materially from those anticipated or implied in the forward-looking statements. Please read “Risk Factors” in the Company’s Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and other public filings as well as the risk factors in Riviera’s Registration Statement on Form S-1. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information or future events.
Source: Linn Energy, Inc.