16.

SUBSEQUENT EVENTS:

On November 2, 2012, the Company’s board of directors declared the Special E&P Distribution as a special dividend to stockholders in the amount of $6.84 per share of common stock, aggregating approximately $309.7 million, to be paid on December 21, 2012 to stockholders of record as of November 13, 2012 in the form described as follows. The Company will limit the total amount of cash payable in the Special E&P Distribution to a maximum of 20% of the total value of the Special E&P Distribution. The balance of the Special E&P Distribution will be in the form of shares of the Company’s common stock. If the total amount of cash elected by the Company’s stockholders exceeds 20% of the total value of the Special E&P Distribution, then, in general, the available cash will be prorated among those stockholders that elect to receive cash. The details and consequences of the Special E&P Distribution will be described in the election form and accompanying materials that will be mailed to stockholders in connection with the Special E&P Distribution.

As a result of the Special E&P Distribution, pursuant to anti-dilution provisions included in the indenture under which the Convertible Notes were issued, on November 8, 2012, the conversion rate of the Convertible Notes will be adjusted to 44.4492 shares of common stock per $1,000 principal amount of the Convertible Notes, which is equivalent to a conversion price of $22.50 per share. In addition, in accordance with customary anti-dilution provisions, the strike price of the Purchased Options will be adjusted to $22.50 per share of the Company’s common stock, which will enable the Company to purchase approximately 16.0 million shares of Company common stock. Further, the exercise price of the common stock purchase warrants discussed in Note 4 and Note 7 will be adjusted in a similar manner.