Item 5.01 Changes in Control of Registrant.
As previously disclosed, on October 6, 2021, Tapstone Energy Holdings, LLC, a
Delaware limited liability company ("Tapstone Holdings"), the parent of Tapstone
Energy, LLC ("Tapstone"), entered into an Agreement and Plan of Merger (the
"Merger Agreement") with Diversified Energy Company PLC ("Diversified"), the
parent of Diversified Production LLC ("Diversified Production"), and certain of
its affiliates, including Diversified Production. Upon the terms and subject to
the conditions set forth in the Merger Agreement, a wholly owned subsidiary of
Diversified merged with and into Tapstone Holdings with Tapstone Holdings as the
surviving entity, resulting in Tapstone Holdings and Tapstone becoming wholly
owned subsidiaries of Diversified. The terms and conditions of the Merger
Agreement were fulfilled on December 7, 2021, and Tapstone Holdings became a
wholly owned subsidiary of Diversified (the "Merger"). Diversified financed the
$419 million consideration in connection with the Merger with debt financing,
along with co-investments by funds managed by Oaktree Capital Management, L.P.
Tapstone's right, title and interest in and to, and all of their duties and
obligations under all documents related to the Trust (including the Amended and
Restated Trust Agreement (dated as of November 16, 2011), the Administrative
Services Agreement (dated as of November 16, 2011) and the related royalty
interest conveyances) remain unchanged as a result of the Merger. However, as a
result of the Merger, Diversified may be deemed the beneficial owner of the
23,750,000 common units of Chesapeake Granite Wash Trust, a Delaware statutory
trust (the "Trust"), held by Tapstone, representing all of Tapstone's 50.8%
beneficial ownership interest in the Trust immediately prior to the effective
time of the Merger.
The Bank of New York Mellon Trust Company, N.A. had no role, responsibility or
obligation in respect of the Merger, and remains trustee of the Trust.
The Trust expects to continue in the normal course without disruption to the
unitholders, and the Merger is not expected to have an impact on the operations
and future distributions of the Trust. Forward looking statements are subject to
risks, which are disclosed in the Trust's Annual and Quarterly Reports filed
with the U.S. Securities and Exchange Commission.
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