Document
false0001539838 0001539838 2019-08-28 2019-08-28


 
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): August 28, 2019
___________
DIAMONDBACK ENERGY, INC.
(Exact Name of Registrant as Specified in Charter)
DE
001-35700
45-4502447
(State or other jurisdiction of incorporation)
(Commission File Number)
(I.R.S. Employer
Identification Number)
500 West Texas
 
 
 
Suite 1200
 
 
 
Midland,
TX
 
 
79701
(Address of principal
executive offices)
 
 
(Zip code)
(432) 221-7400
(Registrant's telephone number, including area code)

Not Applicable
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the Registrant under any of the following provisions:

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))

Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934:
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common Stock, par value $0.01 per share
FANG
The Nasdaq Global Select Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.   
    
 





Item 1.01. Entry into a Material Definitive Agreement.
 
On August 28, 2019, Diamondback Energy, Inc., as parent guarantor (the “Parent Guarantor”), Diamondback O&G LLC, as borrower (the “Borrower”), and certain other subsidiaries of the Parent Guarantor, as guarantors (collectively, with the Parent Guarantor and the Borrower, the “Loan Parties”), entered into a Consent Letter (the “Consent”) with respect to the Second Amended and Restated Credit Agreement, dated as of November 1, 2013, with Wells Fargo Bank, National Association, as administrative agent, and the lenders party thereto (as amended, supplemented or otherwise modified to the date thereof, the “Revolving Credit Facility”).
 
The Consent allows the Loan Parties to enter into certain swap agreements in respect of interest rates for United States Treasury securities for an aggregate notional principal amount of up to $3 billion, subject to certain conditions set forth in the Consent, which otherwise would be in excess of the notional principal amount of interest rate swap agreements permitted under the Revolving Credit Facility immediately prior to the effectiveness of the Consent. At the effective time of the Consent, the Borrower was party to interest rate swap agreements with an aggregate notional principal amount of $1 billion, interest rates ranging from 1.5670% to 2.1509% and maturity dates of August 24, 2020 and December 31, 2030.

The preceding summary of the Consent is qualified in its entirety by reference to the full text of such amendment, a copy of which is attached as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference.

Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
 
The information set forth in Item 1.01 above is incorporated herein by reference, as applicable.
 
Item 9.01. Financial Statements and Exhibits
  
Exhibit Number
  
Description
10.1*
 
*Filed herewith.





SIGNATURE
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 thereunto duly authorized.
 
 
 
 
 
 
 
 
DIAMONDBACK ENERGY, INC.
 
 
 
 
 
Date:
September 4, 2019
 
 
 
 
 
 
By:
/s/ Teresa L. Dick
 
 
 
Name:
Teresa L. Dick
 
 
 
Title:
Executive Vice President and Chief Accounting Officer




Exhibit


Exhibit 10.1
http://api.tenkwizard.com/cgi/image?quest=1&rid=23&ipage=13095700&doc=8
 
Wells Fargo Bank, National Association
 
1000 Louisiana Street, Suite 1200
 
Houston, TX 77002
 
 
 
 
 
August 28, 2019

Diamondback O&G LLC
500 West Texas, Suite 1200
Midland, Texas 79701
Attention: Teresa L. Dick


Re:    Consent Letter

Ladies and Gentlemen:

Reference is hereby made to that certain Second Amended and Restated Credit Agreement, dated as of November 1, 2013 (as amended, supplemented or otherwise modified prior to the date hereof, the “Credit Agreement”), by and among Diamondback O&G LLC, as borrower (the “Borrower”), Diamondback Energy, Inc., as parent guarantor (the “Parent Guarantor”), Wells Fargo Bank, National Association, as administrative agent (the “Administrative Agent”), and the lenders party thereto from time to time. Capitalized terms used herein without definition shall have the meanings given to them in the Credit Agreement.
1.     Request for Consent. The Borrower has advised the Administrative Agent and the Lenders that (a) it is contemplating entering into certain Swap Agreements in respect of interest rates for United States Treasury securities (such Swap Agreements, collectively, the “Subject Swap Agreements”) and (b) the Loan Parties may be prohibited from entering into such Subject Swap Agreements under Section 9.18 of the Credit Agreement. The Borrower has requested that the Administrative Agent and the Lenders enter into this letter agreement (this “Letter Agreement”) to evidence the Lenders’ consent to the Loan Parties entering into the Subject Swap Agreements on the terms and conditions set forth herein.
2.     Limited Consent. In reliance on the representations, warranties, covenants, and agreements contained in this Letter Agreement, and notwithstanding anything in Section 9.18 of the Credit Agreement or any other provision of the Loan Documents that may prohibit the Loan Parties from entering into the Subject Swap Agreements, Lenders constituting Majority Lenders hereby consent to the Loan Parties entering into the Subject Swap Agreements, subject to the following terms and conditions:
(a)the aggregate notional principal amount of United States Treasury securities subject to the Subject Swap Agreements shall not, in any event, exceed $3,000,000,000.00;
(b)the pricing and other economics of such Subject Swap Agreements are on prevailing market terms;
(c)such Subject Swap Agreements are entered into by the applicable Loan Party(ies) on or prior to December 31, 2019;
(d)such Subject Swap Agreements do not have a tenor extending beyond December 31, 2020; and
(e)such Subject Swap Agreements shall be with an Approved Counterparty.
3.    Limitations on Consent. Nothing contained herein, nor any past indulgence by the Administrative Agent or any Lender, nor any other action or inaction on behalf of the Administrative Agent or any Lender, shall be deemed a consent to, or waiver of, any other action or inaction of the Parent Guarantor, the Borrower, or any of the other Loan Parties that constitutes (or would constitute) a violation of any provision of the Credit Agreement or any other Loan Document, or which results (or would result) in a Default or Event of Default under the Credit Agreement





or any other Loan Document. This Letter Agreement shall not constitute a course of conduct or dealing among the parties. The Administrative Agent and the Lenders shall have no obligation to grant any future waivers, consents or amendments with respect to the Credit Agreement or any other Loan Document, and the parties hereto agree that the limited consent provided in paragraph 2 above shall constitute a one-time consent and shall not waive, affect, or diminish any right of the Administrative Agent and/or the Lenders to hereafter demand strict compliance with the Credit Agreement and the other Loan Documents.

4.    Miscellaneous.    

(a)    Confirmation. The provisions of the Credit Agreement (subject to the limited consent provided in this Letter Agreement) shall remain in full force and effect following the effectiveness of this Letter Agreement.

(b)    Ratification and Affirmation; Representations and Warranties. Each of the Guarantors and the Borrower hereby (i) ratifies and affirms its obligations under, and acknowledges its continued liability under, each Loan Document to which it is a party and agrees that each Loan Document to which it is a party remains in full force and effect, subject to the consent granted in this Letter Agreement and (ii) represents and warrants to the Lenders that as of the date hereof, after giving effect to the terms of this Letter Agreement:

(A)    all of the representations and warranties contained in each Loan Document to which it is a party are true and correct in all material respects (or, if already qualified by materiality, Material Adverse Effect or a similar qualification, true and correct in all respects), except to the extent any such representations and warranties are expressly limited to an earlier date, in which case such representations and warranties shall be true and correct in all material respects (or, if already qualified by materiality, Material Adverse Effect or a similar qualification, true and correct in all respects) as of such specified earlier date, except with respect to actions permitted by this Letter Agreement;

(B)    no Default or Event of Default has occurred and is continuing; and

(C)    no event or events have occurred which individually or in the aggregate could reasonably be expected to have a Material Adverse Effect.

(c)    Counterparts. This Letter Agreement may be executed by one or more of the parties hereto in any number of separate counterparts, and all of such counterparts taken together shall be deemed to constitute one and the same instrument. Delivery of this Letter Agreement by facsimile or electronic transmission shall be effective as delivery of a manually executed counterpart hereof.

(d)    NO ORAL AGREEMENT. THIS LETTER AGREEMENT, THE CREDIT AGREEMENT AND THE OTHER LOAN DOCUMENTS EXECUTED IN CONNECTION HEREWITH AND THEREWITH REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT UNWRITTEN ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

(e)    GOVERNING LAW. THIS LETTER AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF TEXAS.

(f)    Payment of Expenses. Subject to the limitations set forth in Section 12.03 of the Credit Agreement, the Borrower agrees to pay or reimburse the Administrative Agent for all of its reasonable out-of-pocket expenses incurred in connection with this Letter Agreement, any other documents prepared in connection herewith and the transactions contemplated hereby, including, without limitation, the reasonable fees, charges and disbursements of counsel to the Administrative Agent.

(g)    Severability. Any provision of this Letter Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without

PAGE 2



invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

(h)    Successors and Assigns. This Letter Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.

(i)    Loan Document. This Letter Agreement is a Loan Document.

[Signature Pages Follow]



PAGE 3



Very truly yours,
 
 
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Administrative Agent and a Lender
 
 
 
 
By:
/s/ Todd Fogle
Name: Todd Fogle
Title: Director

Signature Page to Consent Letter Agreement Regarding Interest Rate Hedging - Diamondback O&G LLC




CAPITAL ONE, NATIONAL ASSOCIATION, as a Lender
 
 
 
 
By:
/s/ Wes Fontana
Name: Wes Fontana
Title: Managing Director


Signature Page to Consent Letter Agreement Regarding Interest Rate Hedging - Diamondback O&G LLC




CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH, as a Lender
 
 
 
 
By:
/s/ Nupur Kumar
Name: Nupur Kumar
Title: Authorized Signatory
 
 
By:
/s/ Chris Zybrick
Name: Chris Zybrick
Title: Authorized Signatory

Signature Page to Consent Letter Agreement Regarding Interest Rate Hedging - Diamondback O&G LLC




THE BANK OF NOVA SCOTIA, HOUSTON BRANCH, as a Lender
 
 
 
 
By:
/s/ Ryan Knape
Name: Ryan Knape
Title: Director

Signature Page to Consent Letter Agreement Regarding Interest Rate Hedging - Diamondback O&G LLC




U.S. BANK NATIONAL ASSOCIATION, as a Lender
 
 
 
 
By:
/s/ Tara R. McLean
Name: Tara R. McLean
Title: Vice President

Signature Page to Consent Letter Agreement Regarding Interest Rate Hedging - Diamondback O&G LLC




JPMORGAN CHASE BANK, N.A., as a Lender
 
 
 
 
By:
 
Name:
Title:

Signature Page to Consent Letter Agreement Regarding Interest Rate Hedging - Diamondback O&G LLC




GOLDMAN SACHS BANK USA, as a Lender
 
 
 
 
By:
/s/ Jamie Minieri
Name: Jamie Minieri
Title: Authorized Signatory

Signature Page to Consent Letter Agreement Regarding Interest Rate Hedging - Diamondback O&G LLC




CITIBANK, N.A., as a Lender
 
 
 
 
By:
/s/ Jeff Ard
Name: Jeff Ard
Title: Vice President

Signature Page to Consent Letter Agreement Regarding Interest Rate Hedging - Diamondback O&G LLC




BANK OF AMERICA, N.A., as a Lender
 
 
 
 
By:
 
Name:
Title:

Signature Page to Consent Letter Agreement Regarding Interest Rate Hedging - Diamondback O&G LLC




SUNTRUST BANK, as a Lender
 
 
 
 
By:
/s/ Arize Agumadu
Name: Arize Agumadu
Title: Vice President

Signature Page to Consent Letter Agreement Regarding Interest Rate Hedging - Diamondback O&G LLC




ZIONS BANCORPORATION, N.A., dba AMEGY BANK, as a Lender
 
 
 
 
By:
 
Name:
Title:

Signature Page to Consent Letter Agreement Regarding Interest Rate Hedging - Diamondback O&G LLC




ING CAPITAL LLC, as a Lender
 
 
 
 
By:
/s/ Charles Hall
Name: Charles Hall
Title: Managing Director
 
 
By:
/s/ Scott Lamoreaux
Name: Scott Lamoreaux
Title: Director

Signature Page to Consent Letter Agreement Regarding Interest Rate Hedging - Diamondback O&G LLC




COMMONWEALTH BANK OF AUSTRALIA, as a Lender
 
 
 
 
By:
/s/ Emma Raine
Name: Emma Raine
Title: Senior Associate

Signature Page to Consent Letter Agreement Regarding Interest Rate Hedging - Diamondback O&G LLC




BOKF, N.A. dba BANK OF OKLAHOMA, as a Lender
 
 
 
 
By:
/s/ John Krenger
Name: John Krenger
Title: Vice President

Signature Page to Consent Letter Agreement Regarding Interest Rate Hedging - Diamondback O&G LLC




BRANCH BANKING AND TRUST COMPANY, as a Lender
 
 
 
 
By:
/s/ Parul June
Name: Parul June
Title: Senior Vice President

Signature Page to Consent Letter Agreement Regarding Interest Rate Hedging - Diamondback O&G LLC




CANADIAN IMPERIAL BANK OF COMMERCE, NEW YORK BRANCH, as a Lender
 
 
 
 
By:
/s/ Donovan C. Broussard
Name: Donovan C. Broussard
Title: Authorized Signatory
 
 
By:
/s/ Scott W. Danvers
Name: Scott W. Danvers
Title: Authorized Signatory

Signature Page to Consent Letter Agreement Regarding Interest Rate Hedging - Diamondback O&G LLC




PNC BANK, NATIONAL ASSOCIATION, as a Lender
 
 
 
 
By:
/s/ Sandra Salazar
Name: Sandra Salazar
Title: Managing Director

Signature Page to Consent Letter Agreement Regarding Interest Rate Hedging - Diamondback O&G LLC




IBERIABANK, as a Lender
 
 
 
 
By:
/s/ Stacey Goldstein
Name: Stacy Goldstein
Title: Senior Vice President

Signature Page to Consent Letter Agreement Regarding Interest Rate Hedging - Diamondback O&G LLC




BBVA USA, as a Lender
 
 
 
 
By:
/s/ Julia Barnhill
Name: Julia Barnhill
Title: Vice President

Signature Page to Consent Letter Agreement Regarding Interest Rate Hedging - Diamondback O&G LLC




THE TORONTO-DOMINION BANK, NEW YORK BRANCH, as a Lender
 
 
 
 
By:
/s/ Michael Borowiecki
Name: Michael Borowiecki
Title: Authorized Signatory

Signature Page to Consent Letter Agreement Regarding Interest Rate Hedging - Diamondback O&G LLC




REGIONS BANK, as a Lender
 
 
 
 
By:
/s/ Stuart Murray
Name: Stuart Murray
Title: Director

Signature Page to Consent Letter Agreement Regarding Interest Rate Hedging - Diamondback O&G LLC




MIZUHO BANK, LTD, as a Lender
 
 
 
 
By:
/s/ Edward Sacks
Name: Edward Sacks
Title: Authorized Signatory

Signature Page to Consent Letter Agreement Regarding Interest Rate Hedging - Diamondback O&G LLC




THE HUNTINGTON NATIONAL BANK, as a Lender
 
 
 
 
By:
/s/ Gregory R. Ryan
Name: Gregory R. Ryan
Title: Managing Director

Signature Page to Consent Letter Agreement Regarding Interest Rate Hedging - Diamondback O&G LLC




SUMITOMO MITSUI BANKING CORPORATION, as a Lender
 
 
 
 
By:
/s/ Michael Maguire
Name: Michael Maguire
Title: Managing Director

Signature Page to Consent Letter Agreement Regarding Interest Rate Hedging - Diamondback O&G LLC




COMERICA BANK, as a Lender
 
 
 
 
By:
/s/ Garret R. Merrell
Name: Garret R. Merrell
Title: Vice President

Signature Page to Consent Letter Agreement Regarding Interest Rate Hedging - Diamondback O&G LLC




Accepted and Agreed to:
DIAMONDBACK O&G LLC, as the Borrower
 
 
 
 
By:
/s/ Teresa L. Dick
Name: Teresa L. Dick
Title: Executive Vice President, Chief Accounting Officer, and Assistant Secretary
 
 
DIAMONDBACK ENERGY, INC., as the Parent Guarantor
 
 
 
 
By:
/s/ Teresa L. Dick
Name: Teresa L. Dick
Title: Executive Vice President, Chief Accounting Officer, and Assistant Secretary
 
 
DIAMONDBACK E&P LLC, as a Guarantor
 
 
 
 
By:
/s/ Teresa L. Dick
Name: Teresa L. Dick
Title: Executive Vice President, Chief Accounting Officer, and Assistant Secretary
 
 
ENERGEN CORPORATION, as a Guarantor
 
 
 
 
By:
/s/ Teresa L. Dick
Name: Teresa L. Dick
Title: Executive Vice President, Chief Accounting Officer, and Assistant Secretary
 
 
ENERGEN RESOURCES CORPORATION, as a Guarantor
 
 
 
 
By:
/s/ Teresa L. Dick
Name: Teresa L. Dick
Title: Executive Vice President, Chief Accounting Officer, and Assistant Secretary

Signature Page to Consent Letter Agreement Regarding Interest Rate Hedging - Diamondback O&G LLC




EGN SERVICES, INC., as a Guarantor
 
 
 
 
By:
/s/ Teresa L. Dick
Name: Teresa L. Dick
Title: Executive Vice President, Chief Accounting Officer, and Assistant Secretary


Signature Page to Consent Letter Agreement Regarding Interest Rate Hedging - Diamondback O&G LLC