Denbury Resources buys $95.74 million Encore notes in change-of-control tender offers

By Susanna Moon

Chicago, April 13 - Denbury Resources Inc. said it completed the change-of-control offers for the remaining senior subordinated notes of Encore Acquisition Co.

The company said it purchased the following amounts of notes at 101% of par on April 13:

• $40,712,000 principal amount of Encore's 6¼% senior subordinated notes due 2014;

• $30,714,500 principal amount of the 6% senior subordinated notes due 2015;

• $80,000 principal amount of the 9½% senior subordinated notes due 2016; and

• $24,235,000 principal amount of the 7¼% senior subordinated notes due 2017.

The offers were made as a result of the change of control of Encore via the merger of Encore with and into Denbury. As previously reported, Denbury agreed to acquire Encore in a cash-and-stock deal valued at $4.5 billion, including the assumption of debt and the value of the minority interest in Encore Energy Partners LP. The merger closed on March 10.

After the completion of the offers, there is $1,072,000 of the 6¼% notes outstanding, $485,000 of the 6% notes outstanding, $2,250,000 of the 7¼% notes outstanding and $224,920,000 of the 9½% notes outstanding.

Under the company's previous tender offer that ended on March 10, holders tendered $108,216,000, or 72%, of the 6¼% notes; $268,801,000, or 90%, of the 6% notes; and $123,515,000, or 82%, of the 7¼% notes. The company accepted all of the tendered notes.

Denbury previously said it expected to fund the offers using some of the proceeds from an issue of $1 billion of new 8¼% senior subordinated notes due 2020.

The company previously received the needed consents to amend the note indentures to, among other things, eliminate most of the restrictive covenants, eliminate or modify events of default and eliminate or modify related provisions.

According to a prior news release, Denbury will assume Encore's position as obligor on the remainder of all Encore senior subordinated notes.

MacKenzie Partners, Inc. is the information agent (call 800 322-2885 or collect 212 929-5500; or tenderoffer@mackenziepartners.com).

Denbury and Encore are oil and natural gas companies based in Plano, Texas, and Fort Worth, respectively.

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