Current Report Filing (8-k)
February 08 2016 - 12:49PM
Edgar (US Regulatory)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
February 8, 2016 (February 2, 2016)
EMERALD OIL, INC.
(Exact name of registrant as specified in
its charter)
Delaware |
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1-35097 |
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77-0639000 |
(State or other jurisdiction of
incorporation) |
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(Commission File Number) |
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(IRS Employer
Identification No.) |
200 Columbine Street, Suite 500
Denver, CO 80206
(Address of principal executive offices,
including zip code)
(303) 595-5600
(Registrant’s telephone number, including
area code)
(Former name or former address, if changed
since last report)
Check the appropriate box below if the Form 8-K filing is intended
to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction
A.2. below):
| ¨ | Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c)) |
Item 1.02. Termination of Material Definitive Agreement.
On January 29,
2016, the Amendment to the Forbearance Agreement dated December 18, 2015 with regard to the Amended
and Restated Credit Agreement, dated as of May 1, 2014 (the “Credit Agreement”
or the “Facility”), by and among Emerald Oil, Inc. (the “Company”) and Wells
Fargo Bank, N.A., as administrative agent, and the lenders party thereto (collectively, the “Lenders”) expired,
and the Company was determined to be in default of the Credit Agreement. As a result of this default, on February 2, 2016 the Bank
of Nova Scotia (“BNS”) notified the Company that it had designated February 3, 2016 as the early termination
date of the ISDA Master Agreement (together with all schedules and confirmations and amendments thereto, the “Agreement”)
dated as of June 20, 2014, by and between the Company and BNS. Thereafter, on February 3, 2016, BNS terminated the Agreement and
applied $17.5 million of proceeds from the termination to amounts owing by the Company to BNS under the Credit Agreement.
As a result
of the payment of the Agreement termination proceeds to the Credit Agreement, as well as the proceeds from other transactions
consummated by the Company, the Company has cured the borrowing base deficiency under the Facility, and the borrowing base
under the Facility is currently $113 million, with approximately $111 million currently outstanding. However, notwithstanding
this cure of the borrowing base deficiency, the Company remains in default under the Facility based on the continuing
covenant defaults under the Credit Agreement, and there is no credit available under the Credit Facility.
So long as one or more events of default
are continuing under the Credit Agreement, the Lenders may, subject to compliance with the terms and conditions of the Credit Agreement,
exercise a number of remedies including acceleration of the debt and the sale of collateral. The exercise of certain remedies may
have a material adverse effect on the liquidity, financial condition and results of operations of the Company, and, because the
Company’s liquidity position continues to deteriorate, the Company may still become bankrupt or insolvent.
SIGNATURE
Pursuant to the requirements
of the Securities Exchange Act of 1934, the Company has duly caused this report on Form 8-K to be signed on its behalf by the undersigned
hereunto duly authorized.
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EMERALD OIL, INC.
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Date: February 8, 2016 |
By: |
/s/ Ryan Smith |
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Ryan Smith |
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Chief Financial Officer |
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