Gastar Exploration (GST)

9. Warrants

The following table summarizes warrant information to purchase common shares as of March 31, 2009:

 

		Number of Warrants		Fair Value of Warrant (in thousands)			Warrant Price per Share Range				Weighted Average Remaining Life in Years		Weighted Average Exercise Price in US$
Warrants issued in connection with $3.25 million subordinated unsecured notes payable		232,521		$	235		$	2.76-3.03			0.1		$	2.80
Warrant issued in connection with litigation settlement		10,000,000		$	5,388			(1	)		2.7		$	(1	)

 

(1)

The warrant is exercisable for $2.75 per share in the event that, on or before June 11, 2011, the Company sells all or substantially all of its present oil and gas interests located in Leon and Robertson Counties in East Texas for net proceeds exceeding $500.0 million. A sale, or a series of sales, of all or substantially all of the Company’s present East Texas properties prior to June 11, 2011 for $500.0 million or less will terminate the warrant. If the Company does not sell all or substantially all of these properties by June 11, 2011, the warrant will be exercisable for a six-month period commencing on that date at $3.00 per share. The Company is not obligated to sell any of its East Texas properties.

11. Warrants

The following table summarizes warrant information to purchase common shares as of December 31, 2008:

 

		Number of Warrants		Fair Value of Warrant (in thousands)			Warrant Price per Share Range				Weighted Average Remaining Life in Years		Weighted Average Exercise Price in US$
Warrants issued in connection with $3.25 million subordinated unsecured notes payable		232,521		$	235		$	2.76-3.03			0.3		$	2.80
Warrant issued in connection with the GeoStar litigation settlement		10,000,000		$	5,388			(1	)		2.9		$	(1	)

 

(1)

The warrant is exercisable for $2.75 per share in the event that, on or before June 11, 2011, the Company sells all or substantially all of its present oil and gas interests located in Leon and Robertson Counties in East Texas for net proceeds exceeding $500.0 million. A sale, or a series of sales, of all or substantially all of the Company’s present East Texas properties prior to June 11, 2011 for $500.0 million or less will terminate the warrant. If the Company does not sell all or substantially all of these properties by June 11, 2011, the warrant will be exercisable for a six-month period commencing on that date at $3.00 per share. The Company is not obligated to sell any of its East Texas properties.

11. Warrants

FACE="Times New Roman" SIZE="2">The following table summarizes warrant information to purchase common shares as of December 31, 2008:

 

		Number of Warrants		Fair Value of Warrant (in thousands)			Warrant Price per Share Range				Weighted Average Remaining Life in Years		Weighted Average Exercise Price in US$
Warrants issued in connection with $3.25 million subordinated unsecured notes payable		232,521		$	235		$	2.76-3.03			0.3		$	2.80
Warrant issued in connection with the GeoStar litigation settlement		10,000,000		$	5,388			(1	)		2.9		$	(1	)

 

(1)

The warrant is exercisable for $2.75 per share in the event that, on or before June 11, 2011, the Company sells all or substantially all of its present oil and gas interests located in Leon and Robertson Counties in East Texas for net proceeds exceeding $500.0 million. A sale, or a series of sales, of all or substantially all of the Company’s present East Texas properties prior to June 11, 2011 for $500.0 million or less will terminate the warrant. If the Company does not sell all or substantially all of these properties by June 11, 2011, the warrant will be exercisable for a six-month period commencing on that date at $3.00 per share. The Company is not obligated to sell any of its East Texas properties.

7. Warrants

The following table summarizes warrant information to purchase common shares as of September 30, 2008:

 

		Number of Warrants		Fair Value of Warrants (in thousands)			Weighted Average Warrant Price				Weighted Average Remaining Life in Years		Weighted Average Exercise Price
Warrants issued in connection with $3.25 million subordinated unsecured notes payable		232,521		$	235		$	2.80			0.6		$	2.80
Warrant issued in connection with the GeoStar litigation settlement		10,000,000		$	5,388			(1	)		3.2			(1	)

 

(1)

The warrant is exercisable for $2.75 per share in the event that, on or before June 11, 2011, the Company sells all or substantially all of its present oil and gas interests located in Leon and Robertson Counties in East Texas for net proceeds exceeding $500 million. A sale, or a series of sales, of all or substantially all of the Company’s present East Texas properties prior to June 11, 2011 for $500 million or less will terminate the warrant. If the Company does not sell all or substantially all of these properties by June 11, 2011, the warrant will be exercisable for a six-month period commencing on that date at $3.00 per share. The Company is not obligated to sell any of its East Texas properties.

 

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Table of Contents

GASTAR EXPLORATION LTD. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

(Unaudited)

 

7. Warrants

The following table summarizes warrant information to purchase common shares as of June 30, 2008:

 

		Number of Warrants		Fair Value of Warrants (in thousands)			Weighted Average Warrant Price				Weighted Average Remaining Life in Years		Weighted Average Exercise Price
Warrants issued in connection with $3.25 million subordinated unsecured notes payable		232,521		$	235		$	2.80			0.8		$	2.80
Warrant issued in connection with the GeoStar litigation settlement		10,000,000			5,388			(1	)		3.4			(1	)

 

(1)

The warrant is exercisable for $2.75 per share in the event that on or before June 11, 2011, the Company sells all or substantially all of its present oil and gas interests located in Leon and Robertson Counties in East Texas for net proceeds exceeding $500 million. A sale, or a series of sales, of all or substantially all of the Company’s present East Texas properties prior to June 11, 2011 for $500 million or less will terminate the warrant. If the Company does not sell all or substantially all of these properties by June 11, 2011, the warrant will be exercisable for a six-month period commencing on that date at $3.00 per share. The Company is not obligated to sell any of its East Texas properties and is not currently pursuing any sale of its East Texas assets.

Warrants. Subject to the approval of the Toronto Stock Exchange and the American Stock Exchange (to the extent required by the rules and procedures of those exchanges), Gastar Ltd. shall grant or issue to GeoStar a warrant in the form attached hereto as Exhibit F (the "Gastar Warrant"), which shall be exercisable only on the terms and conditions set forth therein. Notwithstanding anything to the contrary therein or in the Settlement Agreement, the Parties expressly acknowledge and agree that the Gastar Parties are not obligated, by this Settlement Agreement, the Gastar Warrant, or otherwise, to pursue or consummate the sale of their oil and gas interests in Leon and Robertson Counties, Texas, or to cause the conditions for the exercise of warrants to occur. To the extent the approvals of the Toronto Stock Exchange and/or the American Stock Exchange are required to issue the Gastar Warrant, Gastar Ltd. will use its best efforts to obtain those approvals as soon as possible, but obtaining such approval is not a precondition to closing. Within ninety (90) days of the Closing Date, Gastar shall also issue a Registration Rights Agreement for the benefit of the holders of the Gastar Warrant in substantially the same form as that certain Registration Rights Agreement issued as Exhibit 6 to the PSAs, provided that the Registration Rights Agreement issued for the benefit of the holders of the Gastar Warrant shall not include piggy-back registration rights.