Quarterly report pursuant to Section 13 or 15(d)

COMMON AND PREFERRED STOCK

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COMMON AND PREFERRED STOCK
6 Months Ended
Jun. 30, 2018
Equity [Abstract]  
COMMON AND PREFERRED STOCK
COMMON AND PREFERRED STOCK

The Company’s Certificate of Incorporation authorizes the issuance of up to 455,000,000 shares.  The shares are classified in two classes, consisting of 450,000,000 shares of common stock, par value $0.001 per share, and 5,000,000 shares of preferred stock, par value $0.001 per share.  The board of directors is authorized to establish one or more series of preferred stock, setting forth the designation of each such series, and fixing the relative rights and preferences of each such series.  The Company has neither designated nor issued any shares of preferred stock.

Common Stock

The following is a schedule of changes in the number of shares of common stock outstanding during the six months ended June 30, 2018 and the year ended December 31, 2017:

 
Six Months Ended June 30, 2018
 
Year Ended December 31, 2017
Beginning Balance
66,791,633

 
63,259,781

Restricted Stock Grants
3,153,302

 
911,355

Debt Exchanges
121,774,822

 

Equity Offerings and Acquisitions
102,926,019

 

Legal Settlement

 
3,000,000

Other Surrenders - Tax Obligations
(153,421
)
 
(270,510
)
Other Forfeitures
(892,086
)
 
(108,993
)
Ending Balance
293,600,269

 
66,791,633



2018 Activity

During the six months ended June 30, 2018, 0.2 million shares of common stock were surrendered by certain employees of the Company to cover tax obligations in connection with their restricted stock awards.  The total value of these shares was approximately $0.3 million, which is based on the market prices on the dates the shares were surrendered.

During January 2018, 0.9 million shares of common stock were forfeited in connection with the resignation of the Company’s former interim chief executive officer and chief financial officer. The total amount of share-based compensation expense that was reversed in connection with his resignation was approximately $1.2 million.

Exchange Transactions
On May 15, 2018, as a part of closing the Exchange Agreement (see Note 4), the Company issued 103.2 million shares of the Company’s common stock to the Supporting Noteholders as partial consideration for their exchange of the Outstanding Notes.
In June 2018, the Company issued 18.5 million shares of the Company’s common stock to various noteholders, through privately negotiated exchange transactions, as consideration for the exchange of the Outstanding Notes (See Note 4).
Equity Offerings
On April 10, 2018, the Company completed an underwritten public offering of common stock (the “Public Offering”) pursuant to which it issued 58.7 million shares of common stock and received net proceeds of $84.5 million after underwriting discounts, commissions, and offering expenses. On April 16, 2018, the underwriters exercised their option to purchase an additional 3.6 million shares and the Company received additional net proceeds of $5.2 million after underwriting discounts.
On May 15, 2018, in connection with the closing of the Exchange Agreement, the Company issued 34.7 million shares to various investors through subscription agreements for net proceeds of $52.0 million.

Acquisition Agreement

On June 4, 2018, the Company issued 6.0 million shares of common stock as a part of the purchase price for the purchase of oil and gas properties under the purchase and sale agreement with Salt Creek Oil and Gas, LLC (See Note 3).

Stock Repurchase Program

In May 2011, the Company’s board of directors approved a stock repurchase program to acquire up to $150.0 million of the Company’s outstanding common stock.  The stock repurchase program allows the Company to repurchase its shares from time to time in the open market, block transactions and in negotiated transactions.

During the three and six months ended June 30, 2018 and June 30, 2017, the Company did not repurchase shares of its common stock under the stock repurchase program.  The Company’s accounting policy upon the repurchase of shares is to deduct its par value from Common Stock and to reflect any excess of cost over par value as a deduction from Additional Paid-in Capital.