Item 1.01 Entry into a Material Definitive Agreement.
Exchange Offers and Consent Solicitations
On October 7, 2021 (the "Settlement Date"), Coterra Energy Inc. (formerly Cabot
Oil & Gas Corporation) ("Coterra") completed its previously announced private
offers to eligible holders to exchange (each, an "Exchange Offer" and,
collectively, the "Exchange Offers") any and all outstanding notes issued by
Cimarex Energy Co. ("Cimarex") as set forth in the table below (the "Existing
Cimarex Notes") for (1) new notes issued by Coterra and (2) cash. The Exchange
Offers were not registered under the Securities Act of 1933, as amended (the
"Securities Act"), or any state or foreign securities laws. In conjunction with
the Exchange Offers, Cimarex solicited consents (each, a "Consent Solicitation"
and, collectively, the "Consent Solicitations") to adopt certain proposed
amendments to each of the indentures governing the Existing Cimarex Notes (the
"Amendments") to eliminate certain of the covenants, restrictive provisions and
events of default of such indentures. Pursuant to the Exchange Offers and
Consent Solicitations, the aggregate principal amounts of the Existing Cimarex
Notes set forth in the table below were validly tendered and subsequently
accepted. Such accepted Existing Cimarex Notes will be retired and canceled and
will not be reissued. Following such cancellation, the aggregate principal
amounts of the Existing Cimarex Notes set forth below will remain outstanding.
The Exchange Offers have expired, and are no longer open to participation by any
eligible holders of the Existing Cimarex Notes.
Aggregate Aggregate
Principal Amount Principal Amount
Title of Series of Tendered and Outstanding
Existing Cimarex Notes Accepted Following Settlement
4.375% Senior Notes due
2024 $ 705,503,000 $ 44,497,000
3.90% Senior Notes due
2027 $ 687,282,000 $ 62,718,000
4.375% Senior Notes due
2029 $ 433,188,000 $ 66,812,000
Upon receipt of the requisite number of consents to adopt the Amendments with
respect to each of the three series of the Existing Cimarex Notes, Cimarex
entered into a supplemental indenture with the trustee for each such series of
the Existing Cimarex Notes to effect the Amendments. The Amendments became
operative upon the Settlement Date.
Base Indenture, Supplemental Indenture and New Notes
In connection with the settlement of the Exchange Offers and Consent
Solicitations, on October 7, 2021, Coterra issued:
(i) $705,495,000 aggregate principal amount of 4.375% Senior Notes due 2024 (the
"2024 Notes");
(ii) $687,217,000 aggregate principal amount of 3.90% Senior Notes due 2027 (the
"2027 Notes"); and
(iii) $433,171,000 aggregate principal amount of 4.375% Senior Notes due 2029
(the "2029 Notes" and, together with the 2024 Notes and the 2027 Notes, the
"Notes").
The Notes are governed by an indenture, dated as of October 7, 2021 (the "Base
Indenture"), between Coterra, as issuer, and U.S. Bank National Association, as
trustee (the "Trustee"), as supplemented by the First Supplemental Indenture,
dated as of October 7, 2021 (the "Supplemental Indenture"), between Coterra and
the Trustee.
The Notes are general unsecured, senior obligations of Coterra that rank senior
in right of payment to all existing and future indebtedness that is expressly
subordinated in right of payment to the Notes. The Notes rank equally in right
of payment with all existing and future indebtedness of Coterra that is not
subordinated and are (1) structurally subordinated to all indebtedness and
obligations of Coterra's subsidiaries, including any Existing Cimarex Notes and
any other indebtedness and liabilities of Coterra's subsidiaries, including any
indebtedness of Cimarex that remains outstanding after the Settlement Date and
(2) effectively subordinated to all existing and future senior indebtedness
secured by liens up to the extent of the value of the collateral securing such
indebtedness.
The interest rate and maturity date for each series of Notes is as follows:
(i) The 2024 Notes will bear interest at a rate of 4.375% per annum and will
mature on June 1, 2024;
(ii) The 2027 Notes will bear interest at a rate of 3.90% per annum and will
mature on May 15, 2027; and
(iii) The 2029 Notes will bear interest at a rate of 4.375% per annum and will
mature on March 15, 2029.
The foregoing summary of the Notes does not purport to be complete and is
qualified in its entirety by reference to the full text of (i) the Base
Indenture attached as Exhibit 4.1 hereto; (ii) the Supplemental Indenture
attached as Exhibit 4.2 hereto; and (iii) the forms of the Notes attached as
Exhibits 4.3, 4.4 and 4.5 hereto, the terms of which are, in each case,
incorporated herein by reference.
Registration Rights Agreement
On October 7, 2021, in connection with the completion of the Exchange Offers,
Coterra, J.P. Morgan Securities LLC, BofA Securities, Inc., Citigroup Global
Markets Inc., PNC Capital Markets LLC, Scotia Capital (USA) Inc., TD Securities
(USA) LLC, U.S. Bancorp Investments, Inc., Wells Fargo Securities, LLC, Capital
One Securities, Inc., CIBC World Markets Corp., KeyBanc Capital Markets Inc.,
RBC Capital Markets, LLC, SMBC Nikko Securities America, Inc., Truist
Securities, Inc. and MUFG Securities Americas Inc., as dealer managers, entered
into a registration rights agreement with respect to the Notes (the
"Registration Rights Agreement"). Coterra agreed under the Registration Rights
Agreement to, among other things, use its commercially reasonable efforts to
(i) file a registration statement on an appropriate registration form with
respect to a registered offer to exchange each series of the Notes for new
notes, with terms substantially identical in all material respects to such
series of the Notes (except that the new notes will not be subject to
restrictions on transfer or any increase in annual interest rate), and
(ii) cause such registration statement to become effective under the Securities
Act. Coterra shall pay additional interest on the Notes of up to 1.0% if, among
other things, the registered exchange offer is not completed prior to
December 31, 2022 or a shelf registration statement is required and is not
declared effective on or prior to the 60th day after the later of
(i) December 31, 2022 and (ii) the date on which Coterra receives a duly
executed request by a dealer manager or certain holders for the filing of a
shelf registration.
The foregoing summary of the Registration Rights Agreement does not purport to
be complete and is qualified in its entirety by reference to the full text of
the Registration Rights Agreement attached as Exhibit 4.6 hereto, the terms of
which are 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 of this Current Report on Form 8-K under
"Base Indenture, Supplemental Indenture and New Notes" is hereby incorporated by
reference into this Item 2.03.
© Edgar Online, source Glimpses