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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
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DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): JULY 29, 2003
THE MERIDIAN RESOURCE CORPORATION
(Exact Name of Registrant As Specified In Its Charter)
TEXAS 1-10671 76-0319553
(State or Other Jurisdiction (Commission File No.) (I.R.S. Employer
of Incorporation) Identification No.)
1401 ENCLAVE PARKWAY, SUITE 300
HOUSTON, TEXAS 77077
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
281-597-7000
(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)
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ITEM 5. OTHER EVENTS
The Meridian Resource Corporation ("we", "our" or the "Company") is a
party to the Credit Agreement, dated August 13, 2002, as amended by Amendment
No. 1, dated March 28, 2003 (as amended, the "Credit Agreement"), among the
Company and Societe Generale and Fortis Capital Corp. (collectively, the
"Lenders").
As previously reported, the Lenders notified the Company that they had
determined that a $26.5 million borrowing base deficiency existed at April 30,
2003. Accordingly, they notified the Company that the deficiency would be
required to be satisfied by either sufficient additions to our proved reserves
or repayment on or before July 29, 2003 to avoid an event of default. An event
of default which is not cured results in the entire debt outstanding becoming
due and payable, unless it is waived by the senior lenders, or the Credit
Agreement is otherwise amended.
On July 29, 2003, the Lenders agreed to extend by 45 days or until
September 12, 2003 our compliance date with respect to the notice on April 30,
2003 related to the borrowing base redetermination. Any deficiency can be
remedied through the addition of reserves or value to our current reserve base,
payment to the senior lenders or an amendment to the Credit Agreement on or
before September 12, 2003. Though no assurances can be made that sufficient
funds will be available to pay this deficiency, management believes that the
Company can satisfy this deficiency through a combination of the addition of
reserves, third-party debt or equity financing and cash flow. In order to
address this liquidity issue and address the broader issue of aligning our
capital structure with our long-term business strategy, we have been exploring,
and will continue to explore, various options to provide a means to satisfy the
borrowing base deficiency.
As previously reported, since March 15, 2003, the Company has announced
four exploration discoveries at its Biloxi Marshlands project area along with
the successful recompletion of its Thibodaux No. 1 well which has resulted in
the addition of approximately 42 million cubic feet of gas equivalent per day
("mmcfe/d") or an increase of the Company's daily net production to
approximately 100 mmcfe/d. We cannot assure you as to what effect, if any, that
the resulting increase in revenue and reserves will have on our ongoing
negotiations with the Lenders to resolve the borrowing base issues under the
Credit Agreement.
FORWARD-LOOKING STATEMENTS
We believe that some statements contained in this report relate to
results or developments that we anticipate will or may occur in the future and
are not statements of historical fact. Those statements are "forward-looking
statements" within the meaning of Section 27A of the Securities Act and Section
21E of the Securities Exchange Act of 1934 (the "Exchange Act"). Words such as
"anticipate", "believe", "could", "estimate", "expect", "intend", "may", "plan",
"predict", "project", "will" and similar expressions identify forward-looking
statements. Examples of forward looking statements include statements about our
future operating results; our repayment of debt; our future capital
expenditures; our expansion and growth of operations; and our future investments
in and acquisitions of oil and natural gas properties.
We have based these forward-looking statements on assumptions and
analyses made in light of our experience and our perception of historical
trends, current conditions, and expected future developments. However, you
should be aware that these forward-looking statements are only our predictions
and we cannot guarantee any such outcomes. Future events and actual results
may differ
materially from the results set forth in or implied in the forward-looking
statements. Factors that might cause such a difference include general economic
and business conditions; exposure to market risks in our financial instruments;
fluctuations in worldwide prices and demand for oil and natural gas; the direct
or indirect effects on our business resulting from recent terrorist incidents;
fluctuations in the levels of our oil and natural gas exploration and
development activities; risks associated with oil and natural gas exploration
and development activities; competition for raw materials and customers in the
oil and natural gas industry; technological changes and developments in the oil
and natural gas industry; regulatory uncertainties and potential environmental
liabilities; and potential for and uncertainty of the outcome of pending or
threatened litigation.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) EXHIBITS
EXHIBIT NO. DESCRIPTION
10.1 Credit Agreement, dated August 13, 2002, among the Company,
Societe Generale, as Administrative Agent, Lead Arranger and
Bookrunner, Fortis Capital Corp., as Co-Lead Arranger and
Documentation Agent, and the several lenders from time to
time parties thereto (incorporated by reference to Exhibit
10.1 to the Company's Current Report on Form 8-K, dated
August 13, 2002).
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
THE MERIDIAN RESOURCE CORPORATION
(Registrant)
/s/ Joseph A. Reeves, Jr.
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Joseph A. Reeves, Jr., Chairman of the Board
and Chief Executive Officer
Date: July 29, 2003
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION
10.1 Credit Agreement, dated August 13, 2002, among the Company,
Societe Generale, as Administrative Agent, Lead Arranger and
Bookrunner, Fortis Capital Corp., as Co-Lead Arranger and
Documentation Agent, and the several lenders from time to
time parties thereto (incorporated by reference to Exhibit
10.1 to the Company's Current Report on Form 8-K, dated
August 13, 2002).