The maximum aggregate principal amount of Third Lien Notes that may be issued in the Exchange Offer is equal to $90.0 million (the “Maximum Exchange Amount”). Subject to the conditions of the Exchange Offer set forth in the Offering Documents, Ultra Resources will accept 2025 Notes validly tendered (and not validly withdrawn) such that the aggregate amount of Third Lien Notes to be issued in exchange for such 2025 Notes is no greater than the Maximum Exchange Amount.
If the acceptance for exchange of all of the 2025 Notes tendered for exchange in the Exchange Offer at or prior to the Early Participation Date would result in the issuance of Third Lien Notes in an amount that (i) is greater than the Maximum Exchange Amount, then such 2025 Notes validly tendered (and not validly withdrawn) at or prior to the Early Participation Date will be prorated as set forth in the Offering Documents and (ii) is equal to or greater than the Maximum Exchange Amount, then no 2025 Notes tendered after the Early Participation Date will be accepted for exchange. Accordingly, 2025 Notes validly tendered after the Early Participation Date but on or prior to the Expiration Date will be eligible for exchange only if and to the extent that the aggregate principal amount of 2025 Notes validly tendered (and not validly withdrawn) on or prior to the Early Participation Date would result in the issuance of an aggregate principal amount of the Third Lien Notes that is less than the Maximum Exchange Amount. Furthermore, if the acceptance for exchange of all of the 2025 Notes tendered for exchange in the Exchange Offer at or prior to the Early Participation Date would result in the issuance of Third Lien Notes in an amount that is less than the Maximum Exchange Amount but the acceptance for exchange of all of the 2025 Notes validly tendered (and not validly withdrawn) prior to the Expiration Date would result in the issuance of Third Lien Notes in an amount that is greater than the Maximum Exchange Amount, the 2025 Notes validly tendered (and not validly withdrawn) at or prior to the Early Participation Date will be accepted for exchange without proration in priority to the 2025 Notes tendered after the Early Participation Date, and the 2025 Notes validly tendered after the Early Participation Date will be prorated as set forth in the Offering Documents.
Assuming the Maximum Exchange Amount is issued in exchange for 2025 Notes in the Exchange Offer and that all such 2025 Notes tender on or prior to the Early Participation Date, approximately $171 million aggregate principal amount, or approximately 76%, of the 2025 Notes outstanding as of May 8, 2019 would be exchanged in the Exchange Offer, resulting in approximately $54 million aggregate principal amount, or approximately 24%, of the 2025 Notes remaining outstanding.
The Exchange Offer will expire at 5:00 p.m., New York City time, on June 10, 2019, unless extended (as it may be extended, the “Expiration Date”). Tenders of 2025 Notes in the Exchange Offer may be validly withdrawn at any time prior to 5:00 p.m., New York City time, on May 23, 2019, unless extended (as it may be extended, the “Withdrawal Deadline”), but will thereafter be irrevocable, even if Ultra Resources otherwise extends the Early Participation Date or extends the Exchange Offer beyond the Expiration Date, except in certain limited circumstances where additional withdrawal rights are required by law.
The Exchange Offer is conditioned on the satisfaction or waiver of certain conditions as described in the Offering Documents. The Third Lien Notes will be secured by third-priority liens on substantially all of Ultra Resources’, the Company’s and the subsidiary guarantors’ assets. The Exchange Offer for the 2025 Notes may be amended, extended or terminated by Ultra Resources at its sole option.
The Exchange Offer is only being made, and copies of the Offering Documents will only be made available, to beneficial holders of the 2025 Notes that have properly completed and returned an eligibility form confirming that they are (1) a “qualified institutional buyer” within the meaning of Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”), or (2) not a “U.S. person” and are outside of the United States within the meaning of Regulation S under the Securities Act and, if resident in Canada, (x) an “accredited investor,” as defined inNational Instrument45-106 — Prospectus Exemptions or subsection 73.3(1) of theSecurities Act (Ontario), that either would acquire the Third Lien Notes for its own account or would be deemed to be acquiring the Third Lien Notes as principal by applicable law, (y) a “permitted client” within the meaning of NI31-103 –Registration Requirements, Exemptions and Ongoing Registrant Obligations, and (z) a resident of the province of Alberta, British Columbia, Manitoba, Ontario, Québec or Saskatchewan (such persons, “eligible holders”). Holders of the 2025 Notes who desire to obtain and complete an eligibility form should contact the information agent and exchange agent, D.F. King & Co., Inc., at (800)967-5074 (toll-free) or(212) 269-5550 (for banks and brokers), or via the following website:www.dfking.com/UPLor email upl@dfking.com.
