8-KMaterial AgreementsExhibits & Filings

Diamondback Energy, Inc. 8-K Report, Material Agreement (Sep 24, 2018)

Filed September 24, 2018For Securities:FANG

Summary

Diamondback Energy, Inc. (FANG) announced a private placement of $750 million in aggregate principal amount of 4.750% Senior Notes due 2024. These new notes will be issued under an existing indenture and are essentially an add-on to previously issued notes of the same series. The company expects to receive net proceeds of approximately $739.7 million from this offering, after accounting for discounts and expenses. The primary uses for these proceeds are to repay outstanding borrowings under its revolving credit facility, which stood at $317.5 million as of September 17, 2018, and for general corporate purposes. A portion of the funds may also be allocated to the cash consideration for a pending acquisition of assets from Ajax Resources, LLC. This debt offering is expected to close on September 25, 2018.

Key Highlights

  • 1Private placement of $750 million in 4.750% Senior Notes due 2024.
  • 2Net proceeds estimated at $739.7 million.
  • 3Proceeds to be used for repaying revolving credit facility borrowings ($317.5 million outstanding) and general corporate purposes.
  • 4Funds may also be used for the pending acquisition of assets from Ajax Resources, LLC.
  • 5The new notes are an additional issuance under an existing indenture.
  • 6Offering expected to close on September 25, 2018.

Frequently Asked Questions

Diamondback Energy intends to use the net proceeds from this offering primarily to repay outstanding borrowings under its revolving credit facility and for general corporate purposes. A portion may also be used for the cash consideration of a pending acquisition of assets from Ajax Resources, LLC.

As of September 17, 2018, Diamondback Energy had $317.5 million of borrowings outstanding under its revolving credit facility.

These are new notes being issued as an additional series under an existing indenture dated October 28, 2016. They are of the same interest rate and maturity date as previously issued senior notes.

The offering provides approximately $739.7 million in net proceeds, which will be used to reduce existing debt on the revolving credit facility. This effectively repays a portion of its short-term debt and potentially frees up borrowing capacity, while also funding general corporate needs and a potential acquisition.