Summary
Diamondback Energy, Inc. (FANG) filed an 8-K on June 27, 2014, to report a material definitive agreement related to a significant secondary offering of its common stock. On June 24, 2014, the company entered into an Underwriting Agreement with Credit Suisse Securities (USA) LLC, as underwriter, and Gulfport Energy Corporation and entities controlled by Wexford Capital LP as selling stockholders. This agreement facilitated the public offering of 2,000,000 shares of Diamondback Energy's common stock, with an additional option for up to 300,000 shares, at a price of $90.04 per share. The offering closed on June 27, 2014. Crucially for investors, Diamondback Energy itself will not receive any proceeds from this offering, as it involves the sale of shares by existing selling stockholders. The company's primary involvement in the agreement pertains to customary representations, warranties, indemnification of the underwriter, and the use of its existing shelf registration statement. This filing signals a substantial liquidity event for the selling stockholders, but does not directly impact Diamondback Energy's balance sheet in terms of capital raised.
Key Highlights
- 1Secondary offering of 2,000,000 shares of Diamondback Energy common stock by selling stockholders.
- 2Offering price set at $90.04 per share.
- 3Underwriter: Credit Suisse Securities (USA) LLC.
- 4Selling Stockholders: Gulfport Energy Corporation and entities controlled by Wexford Capital LP.
- 5Diamondback Energy will not receive any proceeds from the sale of these shares.
- 6An option for up to 300,000 additional shares was granted to the underwriter.
- 7The offering closed on June 27, 2014, and was conducted under an effective shelf registration statement.