DIAMONDBACK ENERGY, INC. 
Item 1.01. Entry into a Material Definitive Agreement.
Underwriting Agreement
On
The New Notes will be the Company's general unsecured senior obligations and
will rank equally in right of payment with all of its existing and future senior
indebtedness, including the Company's outstanding senior notes and its guarantee
of the obligations of O&G, its wholly-owned subsidiary, under the revolving the
credit facility with
The net proceeds from the sale of the New Notes, after deducting the
underwriting discounts and estimated offering expenses, are expected to be
approximately
The Underwriting Agreement includes customary representations, warranties and covenants by the Company. It also provides for customary indemnification by each of the Company and the respective Underwriters against certain liabilities arising out of or in connection with sale of the New Notes and for customary contribution provisions in respect of those liabilities.
As more fully described under the caption "Underwriting (Conflicts of Interest)" in the Prospectus, some of the Underwriters and their affiliates have engaged in, and may in the future engage in, investment banking and other commercial dealings in the ordinary course of business with the Company or its affiliates. They have received, or may in the future receive, customary fees and commissions for these transactions. Certain of the underwriters and/or their affiliates serve various roles under the revolving credit facility.
The foregoing description of the Underwriting Agreement is not complete and is qualified in its entirety by reference to the full text of the Underwriting Agreement, which is filed as Exhibit 1.1 to this Current Report on Form 8-K and incorporated in this Item 1.01 by reference.
Item 8.01. Other Events.
Press Release
On
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Conditional Redemption of Existing 2024 Notes
Additionally, on
Investment Grade Changeover Date under the Revolving Credit Facility
Also on
• availability under the revolving credit facility is based solely on
the commitments of the lenders, which are currently $2.5 billion in
the aggregate, and is no longer limited by the borrowing base;
• outstanding borrowings under the revolving credit facility bear
interest at a per annum rate elected by the Company that is equal to
an alternate base rate or LIBOR, in each case plus the applicable
margin. The applicable margin ranges from 0.125% to 1.00% per annum in
the case of the alternate base rate, and the applicable margin ranges
from 1.125% to 2.00% per annum in the case of LIBOR. The applicable
margin depends on the "Pricing Level" (as defined in the revolving
credit facility), which Pricing Level depends on the rating agencies'
ratings of the Company's unsecured debt;
• the revolving credit facility is unsecured, and all liens securing the
revolving credit facility have been released;
• the Company is no longer required to cause any of its subsidiaries to
guarantee the revolving credit facility and, in certain circumstances,
it may cause guarantees made by existing subsidiary guarantors to be
released;
• the prior financial covenants have been replaced by a financial
covenant that requires the Company to maintain a Total Net Debt to
Capitalization Ratio (as defined in the revolving credit facility) of
no more than 65%;
• the revolving credit facility no longer restricts incurrences of debt
by obligors under the revolving credit facility, and it now allows
non-obligors to incur debt in a principal amount outstanding at the
time of incurrence thereof not to exceed 15% of consolidated net
tangible assets (as defined in the revolving credit facility)
("CNTA");
• the revolving credit facility now allows the Company and its
restricted subsidiaries to create liens securing debt if the aggregate
amount of debt secured by such liens does not exceed 15% of CNTA; and
• many of the negative covenants in the revolving credit facility are no
longer in effect, including the covenants that formerly limited (i)
equity repurchases, dividends and other restricted payments, (ii)
redemptions of certain other debt, (iii) making investments, (iv)
dispositions of property, (v) transactions with affiliates, and (vi)
entering into swap agreements.
The foregoing description of the terms of the revolving credit facility is not complete and is qualified in its entirety by reference to the full text of the revolving credit facility, which is filed as Exhibit 10.1 to this Current Report on Form 8-K and incorporated in this Item 8.01 by reference.
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Item 9.01. Financial Statements and Exhibits
Exhibit Number Description
1.1 Underwriting Agreement, dated November 20, 2019 , among Diamondback
Energy, Inc. , Diamondback O&G LLC and BofA Securities, Inc. , J.P.
Morgan Securities LLC and Wells Fargo Securities, LLC , as
representatives of the several underwriters named therein.
10.1 Eleventh Amendment to Second Amended and Restated Credit
Agreement, dated as of June 28, 2019 , between Diamondback Energy,
Inc. , as parent guarantor, Diamondback O&G LLC , as borrower, certain
other subsidiaries of Diamondback Energy, Inc. as guarantors, Wells
Fargo Bank, National Association , as administrative agent, and the
lenders party thereto (incorporated by reference to Exhibit 10.1 to
the Form 8-K, File No. 001-35700, filed by the Company with the SEC
on July 3, 2019 ).
99.1 Press Release dated November 20, 2019 entitled "Diamondback Energy
Prices Offering of Senior Notes."
104 Cover Page Interactive Data File (formatted as Inline XBRL).
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