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 2, 2010 (November
1, 2010)
GASTAR
EXPLORATION LTD.
(Exact
Name of Registrant as Specified in its Charter)
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ALBERTA,
CANADA
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001-32714
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98-0570897
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(State
or other jurisdiction
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(Commission
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(IRS
Employer
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of
incorporation)
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File
Number)
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Identification
No.)
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1331
LAMAR STREET, SUITE 1080
HOUSTON,
TEXAS 77010
(Address
of principal executive offices)
(713)
739-1800
(Registrant's
telephone number, including area code)
Check the
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-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
SECTION
1 – REGISTRANT’S BUSINESS AND OPERATIONS
Item
1.01 Entry into a Material Definitive Agreement.
Effective November 1, 2010, Gastar
Exploration Ltd. (the “Company”) entered into a Final Settlement Agreement and
Comprehensive General Release (the “Settlement Agreement”) by and among James D.
Lyon, as Chapter 7 Trustee of ClassicStar LLC, the Company and the other
individuals and entities set forth therein. The Settlement Agreement
reflects the definitive terms of the settlement of the seven In re ClassicStar Mare Lease
Litigation matters that the Company is involved in, each of which is
described in Note 13 to the financial statements included in the Company’s
Quarterly Report on Form 10-Q for the period ended June 30, 2010, the
description of which is incorporated by reference herein. The Settlement
Agreement is contingent upon approval of the United States Bankruptcy Court for
the Eastern District of Kentucky (the “Bankruptcy Court”), which is overseeing
the Chapter 7 liquidation of ClassicStar, LLC. It is anticipated that
the Settlement Agreement will be presented to the Bankruptcy Court for approval
on or after November 19, 2010. If the Settlement Agreement is
approved by the Bankruptcy Court, as proposed, the Company will pay to the
plaintiffs an aggregate of $21.15 million in cash, including an initial $18.0
million payment to be paid within 10 business days of the approval date and the
remaining $3.15 million to be paid in 16 monthly payments, the first of which
will be $150,000 and the next 15 of which will be $200,000 each, in exchange for
dismissal of all existing and potential future claims of the plaintiffs in all
seven cases filed against the Company. A form of the Settlement
Agreement is attached hereto as Exhibit 2.3 and is incorporated herein by
reference.
SECTION
7 – REGULATION FD
Item
7.01 Regulation FD Disclosure
On
November 1, 2010, the Company issued a press release announcing entry into the
Settlement Agreement described under Item 1.01 of this Current Report on Form
8-K. A copy of the press release is furnished as Exhibit 99.1 to this
Current Report on Form 8-K and is incorporated herein by reference.
In
accordance with General Instruction B.2 of Form 8-K, the information presented
herein under this Item 7.01 and set forth in the attached Exhibit 99.1 is deemed
to be “furnished” solely pursuant to Item 7.01 of this report and shall not be
deemed “filed” for purposes of Section 18 of the Securities Exchange Act of
1934, as amended, or otherwise subject to the liabilities of that section, nor
shall such information or the Exhibit be deemed incorporated by reference into
any filing under the Securities Act of 1933 or the Securities Exchange Act of
1934, each as amended.
SECTION
9 – FINANCIAL STATEMENTS AND EXHIBITS
Item
9.01 Financial Statements and Exhibits.
(d) Exhibits
The following is a list of exhibits
filed or furnished as part of this Current Report.
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Exhibit No.
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Description of Document
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10.1
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Form
of the Final Settlement Agreement and Comprehensive General Release
between and Among James D. Lyon, Chapter 7 Trustee of ClassicStar LLC,
Gastar Exploration Ltd., and Other Individuals and Entities Set Forth
Herein effective November 1, 2010
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99.1
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Press
release dated November 1, 2010.
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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.
GASTAR
EXPLORATION LTD.
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Date: November
2, 2010
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By:
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/s/ J. RUSSELL
PORTER
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J.
Russell Porter
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President
and Chief Executive
Officer
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EXHIBIT
INDEX
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Exhibit Number
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Description
of Document
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10.1
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Form
of the Final Settlement Agreement and Comprehensive General Release
between and Among James D. Lyon, Chapter 7 Trustee of ClassicStar LLC,
Gastar Exploration Ltd., and Other Individuals and Entities Set Forth
Herein effective November 1, 2010
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99.1
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Press
release dated November 1,
2010.
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