The Meridian Resource Corp. Conversts All Its Series 'C' Preferred Stock
The Meridian Resource Corporation (NYSE: TMR) expects to complete the conversion of all of the issued and outstanding Series "C" Redeemable Convertible Preferred Stock (the "Series "C" Preferred Stock"). Pursuant to the Amended and Restated Certificate of Designation for the Series "C" Preferred Stock, the Company, at its option at any time following the third anniversary of the date of initial issuance, or March 28, 2005, could redeem all shares of the Series C Preferred Stock, in whole or in part, from time to time at the redemption price of $100 per share, plus an amount in cash equal to any and all accumulated dividends that are accrued and unpaid thereon to and including the date fixed for redemption. In lieu of having their shares of Series "C" Preferred Stock redeemed by the Company, the holders of the Series "C" Preferred Stock called for redemption could elect to convert the Series "C" Preferred Stock into shares of the Company's Common Stock at the contractual conversion price of $4.45 per share.
As of December 31, 2004, there were 315,890 shares of Series "C" Preferred Stock issued and outstanding representing approximately $31.6 million of stated value. In a series of stages beginning March 30, 2005, the Company called all of such shares for redemption. As of April 20, 2005, the Company had received notification from holders of all of such shares of their election to convert their holdings into shares of the Company's Common Stock. Accordingly, the Company will issue approximately 7.1 million shares of its Common Stock for the shares of Series "C" Preferred Stock converted during 2005. In addition, a subsequent cash payment representing accrued and unpaid dividends on the converted Series "C" Preferred Stock will be remitted by the Company following surrender of the shares.
As a result of the conversions, the Company's capital structure
has been further simplified and the Company will realize an annual
cash savings of approximately $2.6 million on the Series "C" Preferred
Stock dividends, based on the number of such shares outstanding at
December 31, 2004.
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