Goodrich Enters into Share Lending Deal
Goodrich Petroleum Corporation said that it has entered into a 20-year share lending agreement with Bear, Stearns International Limited ("BSIL"), as principal, and Bear, Stearns & Co. Inc. ("Bear Stearns"), as agent for BSIL, under which it has agreed to loan to BSIL up to 3.3 million shares of its common stock. Goodrich Petroleum also intends to enter into an underwriting agreement with Bear Stearns, pursuant to which BSIL intends to sell the shares of the Company's common stock that BSIL will be entitled to borrow from the Company under the share lending agreement. These shares will be offered in an underwritten offering registered under the Securities Act of 1933, as amended, pursuant to the Company's shelf registration statement in order to facilitate hedging transactions undertaken by purchasers of the Company's convertible notes in our separately announced offering. The Company will not receive any proceeds from the sale of the common stock. BSIL generally will be required to return the borrowed shares as the notes are converted, upon redemption of the notes and upon the occurrence of certain other events. The completion of the share lending arrangement and the common stock offering are conditioned on completion of the convertible notes offering.
While the borrowed shares will be considered as issued and outstanding for corporate law purposes, the Company does not expect the borrowed shares offered and sold by BSIL to be dilutive to the company's earnings per share calculation because of the requirements for BSIL to return those shares to the Company.
Goodrich Petroleum has filed a registration statement (including a prospectus and prospectus supplement) with the SEC for the offering to which this communication relates.
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