Endeavour Announces Settlement of SM Energy Litigation
HOUSTON, April 16, 2014 /PRNewswire/ -- Endeavour International Corporation (NYSE: END) (LSE: ENDV) today announced that a settlement has been reached with SM Energy regarding litigation filed against Endeavour Operating Corporation in December 2011.
In July 2011, Endeavour entered into agreements with SM Energy for the purchase of oil and gas leases, producing properties, geophysical data, a pipeline and related assets in the Marcellus shale play in Pennsylvania for an aggregate consideration of approximately $110 million. In December 2011, Endeavour terminated the agreements based upon its conclusion that title defects to the properties exceeded contractual thresholds and the pipeline was not in compliance with regulatory standards. Late that month, SM Energy filed a lawsuit against the Company and a counter claim was made in January 2012 by Endeavour. On April 16, 2014 the parties reached an agreement to settle the outstanding litigation.
In accordance with the settlement agreement, Endeavour will pay SM Energy $5 million and issue a note for $4.5 million. The note will be paid in three graduated payments beginning in twelve months. Endeavour has also agreed to issue warrants valued at $3.75 million (approximately 2.13 million shares with a strike price of $5.29.) The total settlement expense to be recorded will be $19.25 million, which includes deposits of $6 million paid prior to the execution of the agreements.
Endeavour International Corporation is an oil and gas exploration and production company focused on the acquisition, exploration and development of oil and natural gas in the North Sea and the United States. For more information, visit www.endeavourcorp.com .
SOURCE Endeavour International Corporation