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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event) June 29, 2001
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BELDEN & BLAKE CORPORATION
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(Exact name of registrant as specified in its charter)
Ohio 0-20100 34-1686642
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(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
5200 Stoneham Road, North Canton, Ohio 44720
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(Address of principal executive offices) (Zip Code)
(330) 499-1660
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Registrant's telephone number, including area code
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Item 5. Other Events
On June 29, 2001, Belden & Blake Corporation ("Belden & Blake" or the
"Company") amended its $100 million revolving credit facility ("the Revolver")
from Ableco Finance LLC and Foothill Capital Corporation. The amendment extended
the Revolver's final maturity date to April 22, 2004, from August 23, 2002,
increased the letter of credit sub-limit from $20 million to $30 million and
eliminated the effects of Statement of Financial Accounting Standards No. 133,
"Accounting for Derivative Instruments and Hedging Activities," from covenant
calculations. The Company paid approximately $200,000 in fees and expenses
related to the amendment.
The amendment extended the financial covenant for senior
interest coverage ratio of 3.2 to 1 for the quarters ending September 30, 2002,
through March 31, 2004; and a senior debt leverage ratio of 2.7 to 1 was
extended for the quarters ending September 30, 2002, through March 31, 2004.
These ratios will be calculated quarterly based on the financial results of the
previous four quarters.
The amendment added an early termination fee equal to .25% of
the facility if terminated between the effective date and May 31, 2002. If
termination is after May 31, 2002 but before May 31, 2003, the termination fee
is .125% of the facility. There is no termination fee after May 31, 2003. The
Company is required to hedge at least 20% but not more than 80% of its estimated
hydrocarbon production, on an Mcfe (Million cubic feet of natural gas
equivalent) basis, for the succeeding 12 months on a rolling 12 month basis.
Based on the Company's hedges currently in place and its expected production
levels the Company is in compliance with this hedging requirement through March
2003.
Item 9. Regulation FD Disclosure
Belden & Blake is furnishing the following information under Item 9 of
this Current Report on Form 8-K.
The information in this report is furnished pursuant to Item 9 and
shall not be deemed to be "filed" for purposes of Section 18 of the Exchange Act
or otherwise subject to the liabilities of that section, except if the Company
specifically states that the information is to be considered "filed" under the
Exchange Act or incorporates it by reference into a filing under the Securities
Act of the Exchange Act. This report will not be deemed an admission as to the
materiality of any information in the report that is required to be disclosed
solely by Regulation FD.
The information in this document includes forward-looking statements
that are made pursuant to Safe Harbor Provisions of the Private Securities
Litigation Reform Act of 1995. Forward-looking statements, and the business
prospects of Belden & Blake are subject to a number of risks and uncertainties
which may cause the Company's actual results in future periods to differ
materially from the forward-looking statements contained herein. These risks and
uncertainties include, but are not limited to, the Company's access to capital,
the market demand for and prices of oil and natural gas, the Company's oil and
gas production and costs of operation, results of the Company's future drilling
activities, the uncertainties of reserve estimates and environmental risks.
These and other risks are described in the Company's 10-K and 10-Q reports and
other filings with the Securities and Exchange Commission.
To manage its exposure to natural gas price volatility, the Company may
partially hedge its physical gas sales prices by selling futures contracts on
the New York Mercantile Exchange ("NYMEX") or by selling NYMEX based commodity
derivative contracts which are placed with major financial institutions that the
Company believes are minimal credit risks. The contracts may take the form of
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futures contracts, swaps, collars or options. The Company's financial results
and cash flows can be significantly impacted as commodity prices fluctuate
widely in response to changing market conditions. Accordingly, the Company may
modify its fixed price contract and financial hedging positions by entering into
new transactions or terminating existing contracts. The following table reflects
the natural gas volumes and the weighted average prices under financial hedges
and fixed price contracts (including settled hedges) at June 29, 2001:
NATURAL GAS SWAPS FIXED PRICE CONTRACTS
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ESTIMATED ESTIMATED
NYMEX WELLHEAD WELLHEAD
PRICE PRICE ESTIMATED PRICE
QUARTER ENDING Bbtu PER Mmbtu PER Mcf Mmcf PER Mcf
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September 30, 2001 1,950 $ 4.50 $ 4.65 1,250 $ 3.85
December 31, 2001 2,400 4.77 4.99 900 4.40
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4,350 $ 4.65 $ 4.84 2,150 $ 4.08
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March 31, 2002 2,550 $ 4.95 $ 5.20 970 $ 4.65
June 30, 2002 2,550 4.61 4.76 700 4.30
September 30, 2002 2,550 4.61 4.76 620 4.30
December 31, 2002 2,550 4.63 4.84 560 4.45
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10,200 $ 4.70 $ 4.89 2,850 $ 4.45
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NATURAL GAS COLLARS
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NYMEX PRICE ESTIMATED
PER Mmbtu WELLHEAD PRICE
QUARTER ENDING Bbtu FLOOR/CAP PER Mcf
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March 31, 2003 1,650 $ 3.40 - 5.23 $ 3.60 - 5.43
June 30, 2003 1,650 3.40 - 5.23 3.60 - 5.43
September 30, 2003 1,650 3.40 - 5.23 3.60 - 5.43
December 31, 2003 1,650 3.40 - 5.23 3.60 - 5.43
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6,600 $ 3.40 - 5.23 $ 3.60 - 5.43
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Bbtu - BILLION BRITISH THERMAL UNITS Mmcf - MILLION CUBIC FEET
Mmbtu - MILLION BRITISH THERMAL UNITS Mcf - THOUSAND CUBIC FEET
At June 29, 2001, the natural gas swaps and collars above
represented approximately $17.1 million in unrealized gains.
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Signatures
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Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: July 3, 2001 BELDEN & BLAKE CORPORATION
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By: /s/ Robert W. Peshek
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Robert W. Peshek, Vice President
and Chief Financial Officer