01—Abstract
Summary
Summary of the 8-K filed June 18, 2024. Cited figures are marked; the original filing is the authoritative source.
On June 18, 2024, Permian Resources Corporation entered into an amended and restated registration rights agreement (A&R RRA), effective July 1, 2024, with its stockholders.
The agreement extends provisions covering organized offerings, piggy-back rights and shelf registration rights through June 30, 2029, clarifies how holders may exercise those rights, and makes administrative updates to provisions that no longer apply. The filing describes the agreement as providing for continued partnership with certain stockholders as they monetize their ownership of the Company's securities. Concurrently, funds affiliated with Pearl Energy Investments will distribute approximately 23 million shares of Class A common stock, issuable upon redemption of common units in Permian Resources Operating, LLC, along with cancellation of a corresponding number of Class C shares, to certain equity holders, including limited partners of those funds.
The press release furnished as Exhibit 99.1 states that the Private Equity Stockholders, which include EnCap Investments, Pearl Energy Investments and Riverstone Investment Group, have monetized approximately 200 million shares since the Company's formation and reduced combined sponsor ownership from over 50%a in 2022 to approximately 16% today. After the Member Distribution, the Private Equity Stockholders will own approximately 16% of total shares outstanding, with no party owning more than 7% and only Pearl holding a Board seat. The release states management owns approximately 7% of total shares outstanding, including unvested shares.
02—Key points
Key Highlights
- Entered an amended and restated registration rights agreement on June 18, 2024, effective July 1, 2024, extending key rights through June 30, 2029
- Pearl Energy Investments-affiliated funds will distribute approximately 23 million Class A shares to certain equity holders, including limited partners
- Private Equity Stockholders have monetized approximately 200 million shares since the Company's formation
- Combined sponsor ownership reduced from over 50% in 2022 to approximately 16% today
- After the Member Distribution, no party will own more than 7% and only Pearl will hold a Board seat
- Management owns approximately 7% of total shares outstanding, including unvested shares, with 100% of the Co-CEO's compensation from long-term equity
- No other Private Equity Stockholder elected to distribute common stock at this time
03—Questions
Frequently Asked Questions
What did Permian Resources agree to in the amended and restated registration rights agreement?
The agreement extends provisions on organized offerings, piggy-back rights and shelf registration rights through June 30, 2029, unless earlier terminated for a party. It also clarifies how holders may exercise organized offering rights and the Company's assistance, and updates provisions that no longer apply.
What is the Member Distribution?
Funds affiliated with Pearl Energy Investments will convert and distribute approximately 23 million shares of Class A common stock to certain equity holders, including limited partners of those funds. A corresponding number of Class C shares will be cancelled. The release describes these holders as primarily large, accredited institutional investors who have invested in the Company and its predecessors since 2015.
How much has sponsor ownership declined?
The release states that combined sponsor ownership fell from over 50% in 2022 to approximately 16% today, and that the Private Equity Stockholders have monetized approximately 200 million shares since the Company's formation.
Will the Member Distribution change board representation or large holder concentration?
The release states that after the Member Distribution, the Private Equity Stockholders will own approximately 16% of total shares outstanding, with no party owning more than 7%, and only Pearl will hold a Board seat.
What did the filing say about management ownership?
The release states management owns approximately 7% of total shares outstanding, including unvested shares, and that 100% of the Co-CEO's compensation comes from long-term equity.
04—Continue