MID-CON ENERGY PARTNERS, LP Mid-Con Energy Partners, LP (NasdaqGS:MCEP) announced that it has entered into a purchase agreement for a private placement of 9,302,325 class A convertible preferred units at a price of $2.15 per preferred units for gross proceeds of $20,000,000 on July 31, 2016. At the time of closing, the company may further issue additional units to purchasers for additional proceeds of $5,000,000. The transaction will include participation from new investors, Goff MCEP Holdings, LLC, Goff REN Holdings, LLC, and GAINSCO, Inc. (OTCPK:GANS) for 2,046,512 shares, 2,139,535 shares, and 1,395,349 shares respectively.
The transaction will also include participation from other investors. The preferred units will convertible into common units on a one-for-one basis. Each holder of preferred units will be entitled to receive a cumulative, quarterly distribution in arrears on each preferred unit then held by such preferred unit holder in cash at an annual rate of 8% or in the event that the company's existing secured indebtedness prevents the payment of a cash distribution to all preferred unit holders, in kind at an annual rate of 10%.
In addition, the partnership may, without further action of any party, issue and sell on the closing date, subject to the same terms and conditions, additional preferred units to one or more additional purchaser with an aggregate purchase price not to exceed $5,000,000. The transaction is anticipated to be completed prior to or on August 12, 2016. The closing is subject to customary closing conditions.
At any time after the sixth-month anniversary of the initial closing date, each preferred unit holder shall have the right to convert the preferred units then held by such preferred unit holder, in full or in part, on a one-for-one basis, subject to certain adjustments and conditions. At any time after the fifth anniversary of the closing date, each preferred unit holder shall have the right to cause the company to redeem all or any portion of the outstanding preferred units at a price per preferred unit equal to the unit purchase price.
