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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (date of earliest event reported): November 30, 2011
SYNERGY RESOURCES CORPORATION
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(Exact name of Registrant as specified in its charter)
Colorado None 20-2835920
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(State or other jurisdiction (Commission File No.) (IRS Employer
of incorporation) Identification No.)
20203 Highway 60
Platteville, Colorado 80651
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(Address of principal executive offices, including Zip Code)
Registrant's telephone number, including area code: (970) 737-1073
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N/A
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(Former name or former address if changed since last report)
Check appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2. below)
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-14(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 1.01 Entry into a Material Definitive Agreement
On November 30, 2011 Synergy Resources Corporation entered into a new
revolving line of credit agreement with Bank of Choice, located in
placeCityGreeley, StateColorado. The revolving line of credit allows Synergy to
borrow up to $15,000,000.
Following the execution of the line of credit, Synergy borrowed
approximately $5,342,000 to repay the loan, including accrued interest, to
Petroleum Exploration and Management, LLC, "), a company owned equally by Ed
Holloway and William E. Scaff, Jr., two of the Company's officers and directors.
For further information concerning this loan, see Synergy's 8-K report filed
with the Securities and Exchange Commission on May 24, 2011.
Any additional amounts borrowed from the bank will be used to develop oil
and gas properties, acquire new oil and gas properties, and for working capital
and other general corporate purposes.
Any amounts borrowed from the bank:
o will bear interest, payable monthly, at the greater of 3.25% or
the prime lending rate,
o will be due and payable on November 30, 2014, and
o are secured by substantially all of Synergy's producing wells and
developed oil and gas leases
Any of the following are an event of default which, in some cases if not
cured within a specified number of days (generally 15 to 30 days), could cause
any amounts due under the line of credit to become immediately due and payable:
o Synergy fails to make any interest or principal payment when due;
o Synergy breaches any representation, warranty or covenant or
defaults in the timely performance of any other obligation in its
agreements with the bank;
o Synergy files for protection from its creditors under the federal
bankruptcy code, or a third party files an involuntary bankruptcy
petition against Synergy, or
o A final judgment is entered against Synergy involving a liability
(not paid or fully covered by insurance) of $50,000 or more and
the judgment has not been vacated, discharged, or stayed pending
appeal within 60 days from the entry of the judgement.
The foregoing description of the line of credit agreement, including events
of default, does not purport to be complete and is qualified in its entirety by
reference to Exhibit 10.13 to this report.
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Item 2.03. Creation of a Direct Financial Obligation or an Obligation under
an Off-Balance Sheet Arrangement of a Registrant
The information included under Item 1.01 is incorporated by reference into
this Item 2.03 of this report.
Item 9.01 Financial Statements and Exhibits
Number Description
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10.13 Loan agreements with Bank of Choice.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: December 1, 2011.
SYNERGY RESOURCES CORPORATION
By: /s/ Frank L. Jenninsg
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Frank L. Jennings, Principal Financial
Officer
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