PARSLEY ENERGY, INC. (NYSE:PE) Files An 8-K Entry into a Material Definitive Agreement
Item1.01
| Entry into a Material Definitive Agreement. |
On April 28, 2017, Parsley Energy, Inc. (the Company), Parsley
Energy, LLC, a subsidiary of the Company (the Borrower), each of
the guarantors party thereto (the Guarantors), Wells Fargo Bank,
National Association, as administrative agent (the Administrative
Agent), and the other lenders party thereto entered into the
Third Amendment to Credit Agreement (the Third Amendment). The
Third Amendment amends the Credit Agreement, dated as of
October28, 2016 (as previously amended and as further amended by
the Third Amendment, the Credit Agreement), by and among the
Company, the Borrower, the Guarantors, the Administrative Agent,
JPMorgan Chase Bank, N.A., as syndication agent, BMO Harris Bank,
N.A., as documentation agent, and the other lenders party
thereto.
The Third Amendment, among other things, modifies the terms of
the Credit Agreement to (i)remove all anti-cash hoarding
provisions, (ii)reduce the minimum mortgage and title coverage
requirements from 90% to 85% of the total value of each of (a)the
Borrowers and its subsidiaries proved Oil and Gas Properties (as
defined in the Credit Agreement) and (b)the Borrowers and its
subsidiaries proved, developed and producing reserves, in each
case as evaluated in the most recent reserve report, and
(iii)delete the applicable margin penalty, which increased the
applicable margin by 0.5% with respect to alternate base rate
loans and Eurodollar loans if the Consolidated Leverage Ratio (as
defined in the Credit Agreement) as of the last day of any fiscal
quarter or fiscal year of the Borrower, as applicable, exceeded
3.50 to 1.00.
In addition, the Third Amendment increases the Aggregate Elected
Borrowing Base Commitments (as defined in the Credit Agreement)
from $600.0million to $1.0billion and increases the Borrowing
Base (as defined in the Credit Agreement) from $900.0million to
$1.4billion. The Third Amendment also adds Canadian Imperial Bank
of Commerce-New York Branch, Capital One, National Association,
Citibank, N.A., PNC Bank, National Association, and UBS AG,
Stamford Branch as lenders under the Credit Agreement.
The Administrative Agent, the other lenders party to the Credit
Agreement, and their respective affiliates have from time to time
performed, and may in the future perform, various financial
advisory, commercial banking and investment banking services for
the Company and its affiliates in the ordinary course of business
for which they have received and would receive customary
compensation. In addition, in the ordinary course of their
various business activities, such parties and their respective
affiliates may make or hold a broad array of investments and
actively trade debt and equity securities (or related derivative
securities) and financial instruments (including bank loans) for
their own account and for the accounts of their customers, and
such investments and securities activities may involve the
Companys securities and/or instruments.
The foregoing description of the Third Amendment is qualified in
its entirety by reference to the Third Amendment, a copy of which
is attached as Exhibit 10.3 and is incorporated herein by
reference.
Item2.03 Creation of a Direct Financial Obligation or an
Obligation under an Off-Balance Sheet Arrangement
of a Registrant.
The information
set forth under Item 1.01 above is hereby incorporated into this
Item 2.03 by reference.
| Item7.01 | Regulation FD Disclosure. |
On May 1, 2017,
the Company issued a news release announcing the Third Amendment
and the transactions effected thereby. A copy of the news release
is attached hereto as Exhibit 99.1 and is incorporated herein by
reference.
The information in
this Item 7.01 (including the exhibit) shall not be deemed to be
filed for purposes of Section 18 of the Securities Exchange Act
of 1934, as amended (the Exchange Act), or otherwise subject to
the liabilities of that section, and is not incorporated by
reference into any filing under the Securities Act of 1933, as
amended, or the Exchange Act.
| Item8.01 | Other Events. |
On February13,
2017, the Company, the Borrower, the Guarantors, the
Administrative Agent and the other lenders party thereto entered
into the First Amendment to Credit Agreement (the First
Amendment). The First Amendment, among other things, modified the
terms of the Credit Agreement to permit Parsley Energy Aviation,
LLC to enter into an aviation trust agreement and to then
transfer its aviation assets to the aviation trust governed
thereby.
On April11, 2017,
the Company, the Borrower, the Guarantors, the Administrative
Agent and the other lenders party thereto entered into the Second
Amendment to Credit Agreement (the Second Amendment). The Second
Amendment modified the terms of the Credit Agreement to increase
the maximum letter of credit commitment under the credit facility
from $2.5million to $10.0million.
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The foregoing
descriptions of the First Amendment and the Second Amendment are
qualified in their entirety by reference to the First Amendment
and the Second Amendment, respectively, copies of which are
attached hereto as Exhibit 10.1 and 10.2, respectively, and are
incorporated herein by reference.
| Item9.01 | Financial Statements and Exhibits. |
| (d) | Exhibits |
|
EXHIBIT |
DESCRIPTION |
|
| 10.1 |
First Amendment to Credit Agreement, dated as of February13, 2017, among Parsley Energy, LLC, as borrower, Parsley Energy, Inc., each of the guarantors party thereto, Wells Fargo Bank, National Association, as administrative agent, JPMorgan Chase Bank, N.A., as syndication agent, BMO Harris Bank, N.A., as documentation agent, and the lenders party thereto. |
|
| 10.2 |
Second Amendment to Credit Agreement, dated as of April11, 2017, among Parsley Energy, LLC, as borrower, Parsley Energy, Inc., each of the guarantors party thereto, Wells Fargo Bank, National Association, as administrative agent, JPMorgan Chase Bank, N.A., as syndication agent, BMO Harris Bank, N.A., as documentation agent, and the lenders party thereto. |
|
| 10.3 |
Third Amendment to Credit Agreement, dated as of April 28, 2017, among Parsley Energy, LLC, as borrower, Parsley Energy, Inc., each of the guarantors party thereto, Wells Fargo Bank, National Association, as administrative agent, JPMorgan Chase Bank, N.A., as syndication agent, BMO Harris Bank, N.A., as documentation agent, and the lenders party thereto. |
|
| 99.1 |
News Release, dated May 1, 2017, titled Parsley Energy Increases Credit Facility to $1.4 Billion. |
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About PARSLEY ENERGY, INC. (NYSE:PE)
Parsley Energy, Inc. is an independent oil and natural gas company. The Company is focused on the acquisition, development and exploitation of unconventional oil and natural gas reserves in the Permian Basin. The Permian Basin is located in West Texas and Southeastern New Mexico and comprises over three primary sub-areas: the Midland Basin, the Central Basin Platform and the Delaware Basin. The Company’s properties are primarily located in the Midland and Delaware Basins and its activities have been focused on the vertical development of the Spraberry, Wolfberry and Wolftoka Trends of the Midland Basin. The Company’s vertical wells in the Permian Basin are drilled into stacked pay zones that include the Spraberry, Wolfcamp, Upper Pennsylvanian (Cline), Strawn, Atoka and Mississippian formations. The Company splits its assets into over four areas, including the Midland Basin-Core, Midland Basin-Tier I, Midland Basin-Other and Southern Delaware Basin. PARSLEY ENERGY, INC. (NYSE:PE) Recent Trading Information
PARSLEY ENERGY, INC. (NYSE:PE) closed its last trading session 00.00 at 29.79 with 3,632,487 shares trading hands.
