HOUSTON, May 12, 2014 -- On May 6, 2014, WPX Energy, Inc. (“WPX”) (NYSE: WPX) announced it had entered into an agreement to sell a working interest in certain of its existing Piceance Basin wells to Legacy Reserves LP (“Legacy”) (NASDAQ: LGCY) for $355 million in cash consideration plus a portion of Legacy’s newly-created incentive distribution units (“IDR units”). WPX will be issued and immediately vest in 10% of the authorized IDR units and have the ability to vest in up to an additional 20% of the authorized IDR units contingent upon future drop-downs to Legacy.
The transaction is the first in which an MLP has issued incentive distribution rights to an unaffiliated third party. The transaction is expected to close before the end of June 2014.
Baker Botts represented WPX Energy, Inc. in this transaction.
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