false0000945764 0000945764 2020-05-07
2020-05-07
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
DC 20549
FORM
8-K
CURRENT
REPORT PURSUANT
TO SECTION
13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
Date of
Report (Date of earliest event reported):
May 7, 2020
DENBURY
RESOURCES INC.
(Exact name
of registrant as specified in its charter)
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Delaware
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1-12935
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20-0467835
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(State or
other jurisdiction of incorporation)
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(Commission
File Number)
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(IRS
Employer Identification
No.)
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5320
Legacy Drive
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Plano,
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Texas
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75024
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(972)
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673-2000
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(Address of
principal executive offices)
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(Zip
code)
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(Registrant’s
telephone number, including area code)
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Not
Applicable
(Former
name or former address, if changed since last report)
Check the
appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant
under any of the following provisions (see
General
Instruction A.2. below):
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☐
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Written communications
pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
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☐
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Soliciting material pursuant
to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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☐
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
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☐
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
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Securities
registered pursuant to Section 12(b) of the Exchange
Act:
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Title of
each class
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Trading
Symbol
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Name of each
exchange on which registered
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Common Stock, par value
$.001 per share
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DNR
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New York Stock
Exchange
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Indicate by check mark
whether the registrant is an emerging growth company as defined in
Rule 405 of the Securities Act of 1933 (§230.405 of this chapter)
or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of
this chapter).
Emerging growth
company ☐
If an emerging
growth company, indicate by check mark if the registrant has
elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided
pursuant to Section 13(a) of the Exchange Act. ☐
Section 8 –
Other Events
Item 8.01 –
Other Events
Denbury Resources
Inc. (the “Company” or “Denbury”) will be delaying the filing of
its Quarterly Report on Form 10-Q for the quarterly period ended
March 31, 2020 (the “Quarterly Report”), relying on the order
issued by the U.S. Securities and Exchange Commission (the “SEC”)
on March 25, 2020 in SEC Release No. 34-88465 (the “SEC
Order”) pursuant to the SEC’s authority under Section 36 of
the Securities Exchange Act of 1934 (the “Exchange Act”) granting
exemptions from certain provisions of the Exchange Act and the
rules thereunder related to the reporting requirements for certain
public companies, subject to certain conditions.
The COVID-19
pandemic’s effect on economic activity across the globe has
resulted in a rapid and precipitous drop in demand for oil, which
in turn has caused oil prices to plummet since the first week of
March 2020, negatively affecting the Company’s cash flow, liquidity
and financial position. These events have worsened a deteriorated
oil market which followed the early-March 2020 failure by the group
of oil producing nations known as OPEC+ to reach an agreement over
proposed oil production cuts.
These significant
and rapid changes require complex accounting judgments and
revisions of estimates upon which the Company’s financial
statements are based, which require additional time for
compilation, preparation, and review necessary to prepare the
Company’s Quarterly Report. The Company currently expects to
release its quarterly results and file its Quarterly Report by May
22, 2020; in any event, it will file the Quarterly Report no later
than June 25, 2020 (45 days after the original due date of the
Quarterly Report), which is the revised filing deadline as provided
for in the SEC Order. Under the SEC Order, if the Quarterly Report
is filed by such revised date, it will be deemed timely filed by
the SEC.
Supplemental
Risk Factor
The Company is
supplementing its risk factors previously disclosed in its Annual
Report on Form 10-K for the fiscal year ended December 31, 2019
with the following risk factor:
The current outbreak of COVID-19 has adversely impacted our
business, financial condition, liquidity and results of operations
and is likely to have a continuing adverse impact for a significant
period of time.
The COVID-19
pandemic has caused a rapid and precipitous drop in demand for oil,
which in turn has caused oil prices to plummet since the first week
of March 2020, negatively affecting the Company’s cash flow,
liquidity and financial position. These events have worsened an
already deteriorated oil market that resulted from the early-March
2020 failure by the group of oil producing nations known as OPEC+
to reach an agreement over proposed oil production cuts. Moreover,
the uncertainty about the duration of the COVID-19 pandemic has
caused storage constraints in the United States resulting from
over-supply of produced oil, which is expected to significantly
decrease our realized oil prices in the second quarter of 2020 and
potentially beyond. Oil prices are expected to continue to be
volatile as a result of these events and the ongoing COVID-19
outbreak, and as changes in oil inventories, oil demand and
economic performance are reported. We cannot predict when oil
prices will improve and stabilize.
The current
pandemic and uncertainty about its length and depth in future
periods has caused the realized oil prices we have received since
February 2020 to be significantly reduced, adversely affecting our
operating cash flow and liquidity. Although we have reduced our
2020 capital expenditures budget by 44%, our lower levels of cash
flow could affect our borrowing capacity and may require us to
shut-in production that has become uneconomic. These conditions
have also increased the difficulty in repaying, refinancing or
restructuring our long-term debt, which is necessary in order to
maintain our continuing financial viability, as separately
described in the other risk factors contained in our Annual Report
on Form 10-K for the fiscal year ended December 31,
2019.
The COVID-19
pandemic is rapidly evolving, and the ultimate impact of this
pandemic is highly uncertain and subject to change. The extent of
the impact of the COVID-19 pandemic on our operational and
financial performance will depend on future developments, including
the duration and spread of the pandemic, its severity, the actions
to contain the disease or mitigate its impact, related restrictions
on travel, and the duration, timing and severity of the impact on
domestic and global oil demand. The COVID-19 pandemic may also
intensify the risks described in the other risk factors disclosed
in our Annual Report on Form 10-K for the fiscal year ended
December 31, 2019.
Forward-Looking
Statements
This Current
Report on Form 8-K contains forward-looking statements that involve
risks and uncertainties including statements regarding the expected
filing date of the Quarterly Report and the impact of the COVID-19
pandemic, and other risks and uncertainties detailed in the
Company’s filings with the Securities and Exchange Commission,
including Denbury’s most recent report on Form 10-K. These risks
and uncertainties are incorporated by this reference as though
fully set forth herein. These statements are based on engineering,
geological, financial and operating assumptions that management
believes are reasonable based on currently available information;
however, management’s assumptions and the Company’s future
performance are both subject to a wide range of business risks, and
there is no assurance that these goals and projections can or will
be met. Actual results may vary materially. In addition, any
forward-looking statements represent the Company’s estimates only
as of today and should not be relied upon as representing its
estimates as of any future date. Denbury assumes no obligation to
update its forward-looking statements.
SIGNATURES
Pursuant to the
requirements of the Securities Exchange Act of 1934, the registrant
has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
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Denbury
Resources Inc.
(Registrant)
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Date: May 7,
2020
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By:
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/s/ James S.
Matthews
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James S.
Matthews
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Executive Vice President,
Chief Administrative Officer,
General Counsel and
Secretary
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