Filing Details

 

 

	UNITED STATES
	SECURITIES AND EXCHANGE COMMISSION
	Washington, D.C. 20549
	SCHEDULE 13D

 

Under the Securities Exchange Act of 1934
(Amendment No.     )*

 

(Name of Issuer)

 

(Title of Class of Securities)

 

(CUSIP Number)

 

(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)

 

(Date of Event Which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. o

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7 for other parties to whom copies are to be sent.

* The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

 

 

 

(1) Consists of (i) 1,152,882 shares of Class A Common Stock and 246,925 shares of Class B Common Stock beneficially owned by Strategic Value Partners, LLC as the investment manager of Strategic Value Master Fund, Ltd., (ii) 1,096,913 shares of Class A Common Stock and 234,938 shares of Class B Common Stock beneficially owned by SVP Special Situations III LLC as the investment manager of Strategic Value Special Situations Master Fund III, L.P., (iii) 3,205,298 shares of Class A Common Stock and 360,987 shares of Class B Common Stock beneficially owned by SVP Special Situations IV LLC as the investment manager of Strategic Value Special Situations Master Fund IV, L.P., and (iv) 1,315,357 shares of Class A Common Stock and 195,637 shares of Class B Common Stock beneficially owned by SVP Special Situations III-A LLC as the investment manager of Strategic Value Opportunities Fund, L.P., all of which may also be deemed to be beneficially owned by Strategic Value Partners, LLC as the managing member of each such investment manager entity.

 

(2) Based on 38,588,902 shares of Class A Common Stock and 7,871,512 shares of Class B Common Stock of the Issuer outstanding as of August 13, 2018, and assuming the conversion of the Class B Common Stock into shares of Class A Common Stock on a one-for-one basis.

 

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(1) Consists of 1,096,913 shares of Class A Common Stock and 234,938 shares of Class B Common Stock beneficially owned by SVP Special Situations III LLC as the investment manager of Strategic Value Special Situations Master Fund III, L.P.

 

(2) Based on 38,588,902 shares of Class A Common Stock and 7,871,512 shares of Class B Common Stock of the Issuer outstanding as of August 13, 2018, and assuming the conversion of the Class B Common Stock into shares of Class A Common Stock on a one-for-one basis.

 

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(1) Consists of 3,205,298 shares of Class A Common Stock and 360,987 shares of Class B Common Stock beneficially owned by SVP Special Situations IV LLC as the investment manager of Strategic Value Special Situations Master Fund IV, L.P.

 

(2) Based on 38,588,902 shares of Class A Common Stock and 7,871,512 shares of Class B Common Stock of the Issuer outstanding as of August 13, 2018, and assuming the conversion of the Class B Common Stock into shares of Class A Common Stock on a one-for-one basis.

 

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(1) Consists of 1,315,357 shares of Class A Common Stock and 195,637 shares of Class B Common Stock beneficially owned by SVP Special Situations III-A LLC as the investment manager of Strategic Value Opportunities Fund, L.P.

 

(2) Based on 38,588,902 shares of Class A Common Stock and 7,871,512 shares of Class B Common Stock of the Issuer outstanding as of August 13, 2018, and assuming the conversion of the Class B Common Stock into shares of Class A Common Stock on a one-for-one basis.

 

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(1) Consists of (i) 1,152,882 shares of Class A Common Stock and 246,925 shares of Class B Common Stock beneficially owned by Strategic Value Partners, LLC as the investment manager of Strategic Value Master Fund, Ltd., (ii) 1,096,913 shares of Class A Common Stock and 234,938 shares of Class B Common Stock beneficially owned by SVP Special Situations III LLC as the investment manager of Strategic Value Special Situations Master Fund III, L.P., (iii) 3,205,298 shares of Class A Common Stock and 360,987 shares of Class B Common Stock beneficially owned by SVP Special Situations IV LLC as the investment manager of Strategic Value Special Situations Master Fund IV, L.P., and (iv) 1,315,357 shares of Class A Common Stock and 195,637 shares of Class B Common Stock beneficially owned by SVP Special Situations III-A LLC as the investment manager of Strategic Value Opportunities Fund, L.P., all of which may also be deemed to be beneficially owned by Strategic Value Partners, LLC as the managing member of each such investment manager entity, and which is indirectly majority owned and controlled by the Reporting Person.

 

(2) Based on 38,588,902 shares of Class A Common Stock and 7,871,512 shares of Class B Common Stock of the Issuer outstanding as of August 13, 2018, and assuming the conversion of the Class B Common Stock into shares of Class A Common Stock on a one-for-one basis.

 

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Item 1. Security and Issuer.

 

This statement on Schedule 13D relates to the Class A Common Stock, par value $0.01 per share (the Class A Common Stock), of Chaparral Energy, Inc. (the Issuer). The address of the principal executive offices of the Issuer is 701 Cedar Lake Boulevard, Oklahoma City, OK, 73114.

 

Item 2. Identity and Background.

 

(a) This Schedule 13D is being filed by and on behalf of Strategic Value Partners, LLC, a Delaware limited liability company (SVP), SVP Special Situations III LLC, a Delaware limited liability company (Special Situations III), SVP Special Situations IV LLC, a Delaware limited liability company (Special Situations IV), SVP Special Situations III-A LLC, a Delaware limited liability company (Special Situations III-A), and Victor Khosla (each, a Reporting Person and collectively, the Reporting Persons). The Reporting Persons are making this single, joint filing because they may be deemed to be a group within the meaning of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended (the Act), however this filing shall not be deemed an affirmation that such a group exists for the purposes of the Act or for any other purpose, and each Reporting Person expressly disclaims beneficial ownership of any securities beneficially owned or directly held by any other person. The agreement among the Reporting Persons to file jointly is attached hereto as Exhibit 99.1.

 

The securities reported herein as beneficially owned by SVP include securities directly held by Strategic Value Master Fund, Ltd., a Cayman Islands exempted company. SVP is the investment manager of, and exercises investment discretion over, Strategic Value Master Fund, Ltd. SVP beneficially owns shares beneficially owned by Special Situations III, Special Situations IV and Special Situations III-A, as managing member of each such investment manager entity. SVP is indirectly majority owned and controlled by Mr. Khosla.

 

The securities reported herein as beneficially owned by Special Situations III are directly held by Strategic Value Special Situations Master Fund III, L.P., a Cayman Islands exempted limited partnership. Each of Strategic Value Special Situations Fund III, L.P., a Delaware limited partnership, and Strategic Value Special Situations Offshore Fund III, L.P., a Cayman Islands exempted limited partnership, holds limited partnership interests in Strategic Value Special Situations Master Fund III, L.P. Special Situations III is the investment manager of, and exercises investment discretion over each of Strategic Value Special Situations Master Fund III, L.P., Strategic Value Special Situations Fund III, L.P. and Strategic Value Special Situations Offshore Fund III, L.P. SVP is the managing member of Special Situations III. Special Situations III is indirectly majority owned and controlled by Mr. Khosla.

 

The securities reported herein as beneficially owned by Special Situations IV are directly held by Strategic Value Special Situations Master Fund IV, L.P., a Cayman Islands exempted limited partnership. Each of Strategic Value Special Situations Fund IV, L.P., a Delaware limited partnership, and Strategic Value Special Situations Offshore Fund IV, L.P., a Cayman Islands exempted limited partnership, holds limited partnership interests in Strategic Value Special Situations Master Fund IV, L.P. Special Situations IV is the investment manager of, and exercises investment discretion over each of Strategic Value Special Situations Master Fund IV, L.P., Strategic Value Special Situations Fund IV, L.P. and Strategic Value Special Situations Offshore Fund IV, L.P. SVP is the managing member of Special Situations IV. Special Situations IV is indirectly majority owned and controlled by Mr. Khosla.

 

The securities reported herein as beneficially owned by Special Situations III-A are directly held by Strategic Value Opportunities Fund, L.P., a Cayman Islands exempted limited partnership. Special Situations III-A is the investment manager of, and exercises investment discretion over, Strategic Value Opportunities Fund, L.P. SVP is the managing member of Special Situations III-A. Special Situations III-A is indirectly majority owned and controlled by Mr. Khosla.

 

Strategic Value Master Fund, Ltd., Strategic Value Special Situations Master Fund III, L.P., Strategic Value Special Situations Master Fund IV, L.P., and Strategic Value Opportunities Fund, L.P. are referred to collectively as the Funds in this Schedule 13D.

 

(b) The principal business address of each Reporting Person is c/o Strategic Value Partners, LLC, 100 West Putnam Avenue, Greenwich, CT 06830.

 

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(c) Each of the Reporting Persons is engaged in the business of investing. Set forth in Schedule A hereto are the names, business addresses, present principal occupations and citizenships of the executive officers, directors and control persons, as applicable, of each of the Reporting Persons.

 

(d) During the last five years, none of the Reporting Persons or any of their executive officers, directors or control persons has been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors).

 

(e) During the last five years, none of the Reporting Persons, or any of their executive officers, directors or control persons was a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.

 

(f) The state of organization for each of the Reporting Persons other than Mr. Khosla is Delaware. Mr. Khosla and the persons set forth in Schedule A are citizens of the United States.

 

Item 3. Source and Amount of Funds or Other Consideration.

 

On May 9, 2016, the Issuer and certain of its subsidiaries filed voluntary petitions seeking relief under Chapter 11 of Title 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware.  On March 10, 2017, the Bankruptcy Court confirmed the Issuers Reorganization Plan and on March 21, 2017, the Reorganization Plan became effective and the Issuer emerged from bankruptcy. Upon the Issuers emergence from bankruptcy, all of its existing equity was cancelled and the Issuer issued shares of Class A Common Stock and Class B Common Stock, par value $0.01 per share (the Class B Common Stock, and together with the Class A Common Stock the Common Stock) to the previous holders of the Issuers senior notes and certain general unsecured creditors whose claims were impaired as a result of the Issuers bankruptcy, including to the Funds. The Issuer also issued shares of Class A Common Stock to the Funds in connection with a rights offering entered into in connection with the Issuers Reorganization Plan. The Funds acquired additional shares of Class A Common Stock in open market purchases.

 

The source of funds for the shares of Class A Common Stock which were acquired pursuant to the Issuers rights offering and pursuant to open market purchases was the working capital, or funds available for investment, of the Funds.

 

Item 4. Purpose of Transaction.

 

The Funds received shares of Class A Common Stock and Class B Common Stock (i) in connection with the Issuers Reorganization Plan, (ii) pursuant to the Issuers rights offering conducted in connection with the Issuers Reorganization Plan, and (iii) in open market purchases.

 

The Reporting Persons intend to review their investment in the Issuer on a continuing basis.  Depending on various factors, including but not limited to the Issuers financial position and strategic direction, price levels of its Common Stock, conditions in the securities markets, and general economic and industry conditions, the Reporting Persons may take actions with respect to their investment in the Issuer.  These actions include changing their current investment purpose and/or, from time to time, (i) acquiring or causing affiliates to acquire additional shares of Common Stock in open market transactions, in privately negotiated transactions or through other methods; (ii) disposing or causing affiliates to dispose of some or all of the shares of Common Stock in open market transactions, in privately negotiated transactions or through other methods; or (iii) continuing to hold or causing affiliates to hold the shares of Common Stock (or any derivative thereof).  In addition, the Reporting Persons may engage in further discussions with the Issuers management, members of its board of directors, stockholders and other relevant parties or take other actions concerning the Issuers operations, capital expenditures, financings, executive compensation practices, capital structure, and the composition of the Issuers Board of Directors, and any matter set forth in paragraphs (a) through (j) of Item 4 of Schedule 13D.

 

The disclosure below in Item 6 of this Schedule 13D is incorporated by reference into this Item 4.

 

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Item 5. Interest in Securities of the Issuer

 

(a)  (b) The information requested by these subsections is incorporated herein by reference to the information provided on the cover pages to this Schedule 13D.

 

(c)  Pursuant to the Issuers certificate of incorporation, the Issuers outstanding shares of Class B Common Stock, including the 1,038,487 shares of Class B Common Stock held by Funds and reported as beneficially owned on the cover pages of this Schedule 13D, will automatically convert into shares of Class A Common Stock on a one-for-one basis on December 15, 2018, which is sixty days after October 16, 2018.

 

(d) Except as described in this statement, no other person is known by any Reporting Person to have the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of, the securities beneficially owned by any Reporting Person.

 

(e) Not applicable.

 

Item 6. Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer.

 

On June 6, 2018, SVP and the Funds entered into a support agreement (the Support Agreement) with the Issuer.

 

Pursuant to the Support Agreement, the Issuer (i) increased the number of directors on the Issuers Board of Directors (the Board) such that there would be one vacancy on the Board, and (ii) elected David Geenberg, Co-Head of the U.S. Investment Team of SVP, to fill the newly created vacancy effective June 6, 2018. Subject to SVPs compliance with certain standstill and voting obligations, if Mr. Geenberg agrees to serve, Mr. Geenberg will be included in the Issuers slate of director nominees for election at the Issuers 2019 annual meeting of stockholders.

 

The Issuer also agreed that SVP may replace Mr. Geenberg if he is unable or unwilling to serve on the Board at any time during the standstill period (as discussed below), subject to such replacement director meeting certain criteria as set forth in the Support Agreement.

 

The Support Agreement also includes, among other provisions, certain standstill and voting commitments by SVP, including a voting commitment that SVP will vote in favor of (i) any director nominees recommended by the Board to the stockholders for election and (ii) other routine matters submitted by the Board to the stockholders for a vote. The standstill period shall, subject to the Issuers compliance with the terms of the Support Agreement, extend until the date that is the earlier of (i) 30 days prior to the expiration of the Issuers advance notice period for (A) the Issuers 2020 annual meeting of stockholders or (B) any subsequent annual meeting of stockholders, should Mr. Geenberg or his replacement not be included on the Issuers slate of director nominees for such subsequent annual meeting and (ii) 120 days after Mr. Geenberg or his replacement ceases to serve on the Board. If SVP and its affiliate entities cease collectively to beneficially own the lesser of an aggregate of (i) at least 8% of the Issuers then outstanding shares of Class A Common Stock and (ii) 3,719,850 shares of the Issuers Class A Common Stock, Mr. Geenberg has agreed to resign from the Board. In addition, if SVP or any of its affiliates materially breaches the Support Agreement and fails to cure such breach, Mr. Geenberg has agreed to resign from the Board.

 

This description of the Support Agreement is qualified in its entirety by reference to the full text of the Support Agreement, which is attached hereto as Exhibit A and incorporated by reference herein.

 

Item 7. Materials to be Filed as Exhibits.

 

Exhibit A                                             Support Agreement, dated June 6, 2018 (incorporated by reference to Exhibit 10.1 to the Issuers Current Report on Form 8-K, filed on June 7, 2018)

 

Exhibit 99.1                              Joint Filing Agreement

 

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SIGNATURE

 

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

 

Dated: October 26, 2018

 

	STRATEGIC VALUE PARTNERS, LLC
	By:	/s/ James Dougherty
		Name:	James Dougherty
		Title:	Chief Financial Officer
	SVP SPECIAL SITUATIONS III LLC
	By:	/s/ James Dougherty
		Name:	James Dougherty
		Title:	Chief Financial Officer
	SVP SPECIAL SITUATIONS IV LLC
	By:	/s/ James Dougherty
		Name:	James Dougherty
		Title:	Chief Financial Officer
	SVP SPECIAL SITUATIONS III-A LLC
	By:	/s/ James Dougherty
		Name:	James Dougherty
		Title:	Chief Financial Officer
	By:	/s/ Victor Khosla
		Victor Khosla

 

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SCHEDULE A

 

EXECUTIVE OFFICERS, DIRECTORS AND
CONTROL PERSONS OF THE REPORTING PERSONS

 

Name and Address		Present Principal Occupation and Employment
Victor Khosla Chief Investment Officer c/o Strategic Value Partners, LLC 100 West Putnam Avenue Greenwich, CT 06830		Chief Investment Officer of Strategic Value Partners,LLC, SVP Special Situations III LLC, SVP Special Situations IV LLC and SVP Special Situations III-A LLC
James Dougherty Fund Chief Financial Officer c/o Strategic Value Partners, LLC 100 West Putnam Avenue Greenwich, CT 06830		Chief Financial Officer of Strategic Value Partners, LLC, SVP Special Situations III LLC, SVP Special Situations IV LLC and SVP Special Situations III-A LLC
Edward Kelly Chief Operating Officer c/o Strategic Value Partners, LLC 100 West Putnam Avenue Greenwich, CT 06830		Chief Operating Officer of Strategic Value Partners, LLC, SVP Special Situations III LLC, SVP Special Situations IV LLC and SVP Special Situations III-A LLC
David Charnin General Counsel and Chief Compliance Officer c/o Strategic Value Partners, LLC 100 West Putnam Avenue Greenwich, CT 06830		General Counsel and Chief Compliance Officer of Strategic Value Partners, LLC, SVP Special Situations III LLC, SVP Special Situations IV LLC and SVP Special Situations III-A LLC

 

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