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EXHIBIT 99
Parallel Petroleum Corporation (ticker: PLLL, exchange: NASDAQ) News Release -
5-Oct-2000
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PARALLEL PETROLEUM ANNOUNCES SUCCESSFUL NATURAL GAS DISCOVERY;
ADOPTS STOCKHOLDER RIGHTS PLAN AND AMENDS BYLAWS
Parallel Petroleum Corporation (Nasdaq NMS: PLLL) today announced the current
production rate of a natural gas discovery in the Yegua/Frio Gas Trend in
Jackson County, Texas. The Weaver-Dugger A No. 1, Jackson County, Texas, was
drilled to a total depth of 9,440 feet. The well was perforated in two intervals
from 9,310 to 9,321 feet and 9,323 to 9,326 feet in the Frio formation and is
currently flowing at a rate of 1,871 mcf of gas and 57 barrels of oil per day on
a 9.75/64-inch choke with flowing tubing pressure of 4,750 psi. Based on the
operator's current assessment, the production rate is expected to be increased
to 5,000 mcf per day plus condensate during the next 30 days. Four new prospects
have been identified on this project and are waiting on rigs. The Company owns a
27.63% working interest (20.72% net revenue interest) in the well. The operator,
privately held Allegro Investments, and industry partners own the remaining
interests.
In addition, the Company today announced that its Board of Directors has adopted
a Stockholder Rights Plan. The Plan is designed to protect the Company from
unfair or coercive takeover attempts and to prevent a potential acquiror from
gaining control of the Company without fairly compensating all of the Company's
stockholders.
The Plan creates a dividend of one right for each outstanding share of the
Company's Common Stock. The rights are represented by and traded with the
Company's Common Stock. There are no separate certificates or market for the
rights.
The rights do not become exercisable or trade separately from the Common Stock
unless one or both of the following conditions are met: a public announcement
that a person has acquired 15% or more of the Common Stock of the Company, or a
tender or exchange offer is made for 15% or more of the Common Stock of the
Company.
Should either of the aforementioned conditions be met and the rights become
exercisable, each right will entitle the holder thereof to buy 1/1,000th of a
share of the Company's Series A Preferred Stock at an exercise price of $26.00.
Each 1/1,000th of a share of the Series A Preferred Stock will essentially be
the economic equivalent of one share of Common Stock.
Under certain circumstances the rights entitle the holders to buy the Company's
stock at a 50% discount. In the event that (1) the Company is the surviving
corporation in a merger or other business combination with an entity that owns
15% or more of the Company's outstanding stock; (2) any person shall acquire
beneficial ownership of 15% of the Company's outstanding stock; or (3) there is
any type of recapitalization of the Company that results in an increase by more
than 1% the proportionate share of equity securities of the Company owned by a
person who owns 15% or more of the Company's outstanding stock, each right
holder will have the option to buy for the purchase price Common Stock of the
Company having a value equal to two times the purchase price of the right.
Under certain circumstances the rights entitle the holders to buy shares of the
acquiror's Common Stock at a 50% discount. In the event that, at any time after
a person has acquired 15% or more of the Company's Common Stock, (1) the Company
enters into a merger or other business combination transaction in which the
Company is not the surviving corporation; (2) the Company is the surviving
corporation in a transaction in which all or part of the Common Stock is
exchanged for cash, property or securities of any other person; or (3) more than
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50% of the assets, cash flow or earning power of the Company is sold, each right
holder will have the option to buy for the purchase price stock of the acquiring
company having a value equal to two times the purchase price of the right.
The rights may be redeemed by the Company for $0.001 per right at any time until
the first public announcement of the acquisition of beneficial ownership of 15%
of the Company's Common Stock.
The distribution of the rights will be made to stockholders of record as of
October 16, 2000. Stockholders of record will receive a separate mailing
describing the Plan and a copy of the Plan containing all the provisions of the
new rights will be filed with the Securities and Exchange Commission. The
Company's Plan is similar to those adopted by many other companies.
Also on October 5, 2000, the Board of Directors adopted certain amendments to
the Company's Bylaws. These amendments modify, clarify and add certain
provisions regarding the advance notice requirements for stockholder proposals
before an annual meeting of stockholders, the calling of special meetings of
stockholders, stockholder written consents, and the procedures for nominating
directors.
Parallel Petroleum Corporation is an independent energy company engaged in the
exploration for and the acquisition, development and production of oil and gas
using 3-D seismic technology.
In addition to historical information contained herein, this news release
contains forward-looking statements subject to various risks and uncertainties
that could cause the Company's actual results to differ materially from those in
the forward-looking statements. Forward-looking statements can be identified by
the use of forward-looking terminology such as "may," "will," "expect,"
"intend," "anticipate," "estimate," "continue," "present value," "future,"
"reserves" or other variations thereof or comparable terminology. Factors that
could cause or contribute to such differences could include, but are not limited
to, those relating to the Company's growth strategy, outstanding indebtedness,
dependence on weather conditions, seasonality, expansion and other activities of
competitors, prices of oil and gas, and the general condition of the economy and
its effect on the securities market. While the Company believes its
forward-looking statements are based upon reasonable assumptions, there are
factors that are difficult to predict and that are influenced by economic and
other conditions beyond the Company's control. Investors are directed to
consider such risks and other uncertainties discussed in documents filed by the
Company with the Securities and Exchange Commission.
Parallel Petroleum Corporation
110 N. Marienfeld, Suite 465
Midland, TX 79701
915.684.3727
www.parallel-petro.com
Contact: Rhonda L. Keller
Manager Investor Relations
e-mail: [email protected]
MIDLAND, Texas, September 22, 2000
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Parallel Petroleum Corporation-110 North Marienfeld Suite 465-Midland, Texas
79701-phone 915.684.3727-fax 915.684.3905
