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Centennial Resource Development Announces its Intention to Deliver Notice of Redemption of Warrants

DENVER, Feb. 27, 2017 (GLOBE NEWSWIRE) -- Centennial Resource Development, Inc. together with its affiliates (“Centennial” or the “Company”) (NASDAQ:CDEV) (NASDAQ:CDEVW), announced today that it intends to deliver a notice on March 1, 2017 for the redemption of all of its outstanding warrants originally sold as part of units in its initial public offering in February 2016 (the “Public Warrants”).

“We are very pleased to undertake this important step towards simplifying our capital structure, clarifying our share count and minimizing potential future dilution to Centennial shareholders,” said Mark G. Papa, Chairman and Chief Executive Officer of Centennial. “We encourage all of our Public Warrant holders to exercise their warrants after the redemption process is initiated on March 1, 2017.”

Under the warrant agreement that provides for the terms of the Public Warrants, the Company has the right to redeem the outstanding Public Warrants at any time after they become exercisable on March 1, 2017 if the reported last sale price of Centennial’s Class A Common Stock, par value $0.0001 per share (the “Class A Common Stock”), equals or exceeds $18.00 per share for any 20 trading days within a 30-trading day period ending on the third business day before the Company delivers the notice of redemption. On February 10, 2017, the reported last sale price of the Class A Common Stock exceeded $18.00 for the twentieth trading day in the 30-trading day period commencing on January 12, 2017 and ending on February 24, 2017, triggering the Company’s right to deliver a notice of redemption of the Public Warrants on March 1, 2017. The Company intends to require all holders of the Public Warrants to exercise the Public Warrants on a “cashless basis” and, accordingly, the Company will not receive any cash proceeds from the exercise of the Public Warrants. Each holder of Public Warrants that elects to exercise its Public Warrants will receive, upon the exercise of such Public Warrants, a number of shares of Class A Common Stock equal to the number of Public Warrants held by such holder multiplied by the quotient determined by dividing (x) the difference between the exercise price of a Public Warrant of $11.50 and the Fair Market Value of a share of Class A Common Stock by (y) the Fair Market Value of a share of Class A Common Stock (such quotient, the “Exchange Ratio”), rounded down to the nearest whole share. Under the warrant agreement, the “Fair Market Value” of a share of Class A Common Stock means the average last sale price of the Class A Common Stock for the 10 trading days ending on the third business day before the Company sends the notice of redemption.

Centennial intends to deliver a Notice of Redemption to the record holder of the Public Warrants on March 1, 2017, in which case the Fair Market Value of a share of Class A Common Stock, as determined under the warrant agreement, will be $18.44 per share, the average last sale price of the Class A Common Stock for the 10-trading day period commencing on February 10, 2017 and ending on February 24, 2017, and the Exchange Ratio will be 0.376 shares of Class A Common Stock for each Public Warrant exercised.

On March 31, 2017, all Public Warrants that have not been exercised by that date will be redeemed by the Company at a price of $0.01 per Public Warrant. As of February 24, 2017, there were 16,666,643 Public Warrants issued and outstanding.

About Centennial Resource Development, Inc.

Centennial Resource Development, Inc. is an independent oil and natural gas company focused on the development and acquisition of unconventional oil and associated liquids-rich natural gas reserves in the Permian Basin. The Company’s assets and operations, which are held and conducted through Centennial Resource Production, LLC, are concentrated in the Delaware Basin, a sub-basin of the Permian Basin. For additional information about the Company, please visit www.cdevinc.com.

No Offer or Solicitation

This communication is for informational purposes only and shall not constitute an offer to sell or the solicitation of an offer to buy any securities pursuant to the proposed transactions or otherwise, nor shall there be any sale of securities in any jurisdiction in which the offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such jurisdiction.

Forward-Looking Statements

This communication includes certain statements that may constitute “forward-looking statements” for purposes of the federal securities laws. Forward-looking statements include, but are not limited to, statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “would” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements may include, for example, statements about the benefits of the transaction described in this communication; the future financial performance of Centennial following the transaction; changes in Centennial’s reserves and future operating results; and expansion plans and opportunities. These forward-looking statements are based on information available as of the date of this communication, and current expectations, forecasts and assumptions, and involve a number of judgments, risks and uncertainties. Accordingly, forward-looking statements should not be relied upon as representing Centennial’s views as of any subsequent date, and Centennial does not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws. You should not place undue reliance on these forward-looking statements. As a result of a number of known and unknown risks and uncertainties, Centennial’s actual results or performance may be materially different from those expressed or implied by these forward-looking statements. Some factors that could cause actual results to differ include Centennial’s ability to recognize the anticipated benefits of the transaction, which may be affected by, among other things, competition and the ability of Centennial to grow and manage growth profitably following the transaction; changes in applicable laws or regulations; the possibility that Centennial may be adversely affected by other economic, business, and/or competitive factors; and other risks and uncertainties indicated in Centennial’s public filings with the Securities and Exchange Commission.

Contact: Hays Mabry Director, Investor Relations (713) 357-1393 ir@cdevinc.com

Source:Centennial Resource Development