Item 1.01 Entry into a Material Definitive Agreement.
Additional 12.00% Second-Priority Senior Secured Notes due 2026
On
The Issuer intends to use the net proceeds from the offering of the Additional Notes to repay a portion of the outstanding borrowings under its reserves-based lending facility.
First Supplemental Indenture
The Additional Notes were issued pursuant to the first supplemental indenture,
dated as of
The Additional Notes and the
The Notes are unconditionally guaranteed on a senior unsecured basis by the
Company and on a second-priority senior secured basis by each of the Subsidiary
Guarantors and will be unconditionally guaranteed on the same basis by certain
of the Issuer's future subsidiaries. The Notes are secured on a second-priority
basis by liens on substantially the same collateral (the "Collateral") as the
Issuer's existing first-priority obligations under its senior reserve-based
revolving credit facility. Those security interests are subject to an
intercreditor agreement governing the rights and priorities of the secured
parties under the Indenture and the holders of certain other indebtedness
outstanding on
Interest and Maturity
The Notes will mature on
Optional Redemption
At any time prior to
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On or after
YEAR REDEMPTION PRICE 2023 106.000 % 2024 103.000 % 2025 100.000 % Change of Control
If a Change of Control (as defined in the Indenture) occurs, each holder of Notes may require the Issuer to repurchase all or any part of that holder's Notes for cash at a price equal to 101% of the aggregate principal amount of the Notes repurchased, plus any accrued and unpaid interest on the notes repurchased (subject to the right of holders of record on the relevant record date to receive interest due on the relevant interest payment date).
Certain Covenants
The Indenture contains covenants that, among other things, limit the Issuer's ability and the ability of its restricted subsidiaries to: (i) incur, assume or guarantee additional indebtedness or issue certain convertible or redeemable equity securities; (ii) create liens to secure indebtedness; (iii) pay distributions on equity interests, repurchase equity securities or redeem junior lien, unsecured or subordinated indebtedness; (iv) make investments; (v) restrict distributions, loans or other asset transfers from the Issuer's restricted subsidiaries; (vi) consolidate with or merge with or into, or sell substantially all of the Issuer's properties to, another person; (vii) sell or otherwise dispose of assets, including equity interests in subsidiaries; and (viii) enter into transactions with affiliates.
Events of Default
The Indenture contains customary events of default, including, but not limited to: • default in any payment of interest on the Notes, when due, which continues for 30 days; • default in payment when due of the principal of, or premium, if any, on the Notes when due; • failure by the Issuer or any of its Restricted Subsidiaries (as defined in the Indenture) to comply with certain of their respective obligations, covenants or agreements contained in the Notes, the Indenture or the Security Documents (as defined in the Indenture), subject to certain notice and grace periods; • failure of liens on Collateral with a Fair Market Value (as defined in the Indenture) in excess of$100.0 million to be valid or enforceable for 30 days or the Issuer or the assertion by any Subsidiary Guarantor in any pleading that any such security interest is invalid and unenforceable and, in the case of any Subsidiary Guarantor, such assertions are not rescinded within 30 days; • failure by the Issuer or certain of its subsidiaries (including its Restricted Subsidiaries) to pay indebtedness within any applicable grace period or the acceleration of any such indebtedness if the total amount of such indebtedness exceeds$25.0 million ; • failure by the Issuer or any of its Restricted Subsidiaries to pay final non-appealable judgments aggregating in excess of$25.0 million , which judgments are not paid, discharged or stayed for a period of 60 days; • except as permitted by the Indenture, any guarantee of the Notes is held in any judicial proceeding to be unenforceable or invalid, or ceases for any reason to be in full force and effect, or is denied or disaffirmed by a Guarantor; and • certain events of bankruptcy or insolvency described in the Indenture with respect to the Issuer and certain of its subsidiaries (including its Restricted Subsidiaries) that, taken as a whole, would constitute a significant subsidiary of the Issuer. 3
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The foregoing description of the Indenture and the Additional Notes does not
purport to be complete and is qualified in its entirety by reference to the full
text of (i) the Base Indenture and the form of 12.00% Second-Priority Senior
Secured Notes due 2026, copies of which are filed as Exhibits 4.1 and 4.2,
respectively, to the Company's Current Report on Form 8-K filed on
Registration Rights Agreement
On
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant.
The information required by Item 2.03 relating to the Additional Notes and the Indenture is contained in Item 1.01 of this Current Report on Form 8-K above and is incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits. Exhibit No. Description 4.1 Indenture, dated as ofJanuary 4, 2021 , among the Issuer, the Guarantors named therein andWilmington Trust, National Association , as trustee and as collateral agent (incorporated by reference to Exhibit 4.1 to the Company's Current Report on Form 8-K filed onJanuary 8, 2021 ). 4.2 Form of 12.00% Second-Priority Senior Secured Note due 2026 (included as Exhibit A in Exhibit 4.1 and incorporated by reference to Exhibit 4.2 to the Company's Current Report on Form 8-K filed onJanuary 8, 2021 ). 4.3 First Supplemental Indenture, dated as ofJanuary 14, 2021 , among the Issuer, the Guarantors named therein andWilmington Trust, National Association , as trustee and as collateral agent. 4.4 Registration Rights Agreement, dated as ofJanuary 14, 2021 , among the Issuer, the Guarantors named therein andJ.P. Morgan Securities LLC , as representative of the initial purchasers of the Additional Notes. 104 Cover Page Interactive Data File (embedded within the Inline XBRL document). 4
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