Current Report Filing (8-k)
December 21 2017 - 7:42AM
Edgar (US Regulatory)
UNITED STATES SECURITIES AND
EXCHANGE COMMISSION
WASHINGTON, D.C. 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): December 15, 2017
EXCO RESOURCES, INC.
(Exact name of registrant as specified in its charter)
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Texas
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001-32743
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74-1492779
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(State or other jurisdiction of
incorporation or organization)
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(Commission File Number)
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(I.R.S. Employer
Identification No.)
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12377 Merit Drive
Suite 1700
Dallas,
Texas
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75251
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(Address of principal executive offices)
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(Zip Code)
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Registrants telephone number, including area code:
(214)
368-2084
Not Applicable.
(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))
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this
chapter) or Rule
12b-2
of the Securities Exchange Act of 1934
(§240.12b-2
of this chapter)
Emerging growth company ☐
If an emerging growth company,
indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 1.01.
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Entry into a Material Definitive Agreement.
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Forbearance Agreements
On December 19, 2017, and with respect to the RBL Forbearance Agreement (as defined below), December 20, 2017, EXCO Resources, Inc.
(the
Company
) and certain subsidiaries of the Company (the
Guarantors
and, together with the Company, the
Obligors
) entered into a series of forbearance agreements with:
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certain holders (the
Supporting Holders
) of approximately $275.0 million in aggregate principal amount (representing approximately 87% of the outstanding principal amount) of the Companys
8.0 % / 11.0 % 1.5 Lien Senior Secured PIK Toggle Notes due 2022 (the
Senior Secured Notes
) issued pursuant to the Indenture (as amended, supplemented, or modified from time to time, the
Indenture
),
dated as of March 15, 2017, by and among the Company, the guarantors party thereto and Wilmington Trust, National Association, as trustee and collateral trustee (the
1.5L Forbearance Agreement
);
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certain lenders (the
1.75L Supporting Lenders
) of approximately $546.8 million in aggregate principal amount (representing approximately 81% of the outstanding principal amount) of the term loans
under the Companys 1.75 Lien Term Loan Facility, pursuant to that certain Credit Agreement (as amended, supplemented, or modified from time to time, the
1.75L Credit Agreement
), dated March 15, 2017, by and among the
Company, the guarantors party thereto and Wilmington Trust, National Association as administrative agent and collateral trustee (the
1.75L Forbearance Agreement
); and
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the majority lenders and the administrative agent (the
RBL Supporting Lenders
and together with the Supporting Holders and the 1.75L Supporting Lenders, the
Forbearing Parties
)
under the Companys Senior Secured Reserve-Based Revolving Credit Agreement (as amended, supplemented, or modified from time to time, the
RBL Credit Agreement
and, together with the Indenture and the 1.75L Credit Agreement,
the
Debt Instruments
), dated July 31, 2013, by and among the Company, the guarantors party thereto and JPMorgan Chase Bank, N.A. as administrative agent (the
RBL Forbearance Agreement
and together with the
1.5L Forbearance Agreement and the 1.75L Forbearance Agreement, the
Forbearance Agreements
).
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Pursuant to
the Forbearance Agreements, the Forbearing Parties have agreed to forbear from exercising their rights and remedies under the Debt Instruments or the related security documents until the earlier of (a) 11:59 p.m. New York City time on
January 15, 2018 and (b) the date the Forbearance Agreements otherwise terminate in accordance with the terms therein, with respect to certain anticipated events of default arising under the Debt Instruments as a result of the
Companys failure to pay interest due on the 1.75 Lien Credit Agreement on December 20, 2017, its anticipated failure to pay interest on its second lien term loan due on December 29, 2017 and certain covenant defaults under the RBL Credit
Agreement. Pursuant to the 1.5L Forbearance Agreement, the Supporting Holders have agreed to not deliver any notice or instruction in respect of the exercise any of the rights and remedies under the Indenture or the related security documents with
respect to such defaults. The Supporting Holders have also agreed to not transfer any ownership in the Senior Secured Notes held by any of the Supporting Holders during the Forbearance Period other than to potential transferees currently parties to
or who agree in writing to be bound by the 1.5L Forbearance Agreement and agreed, in their capacity as holders of the Companys common stock, to waive any breach of the registration rights agreement entered into in connection with the issuance
of the Senior Secured Notes arising out the Companys failure to maintain an effective resale registration statement. In connection with the RBL Forbearance Agreement, the Company has agreed to pay certain fees to the lenders.
The foregoing description of the Forbearance Agreements is a summary only and is qualified in its entirety by reference to the complete text
of the (i) the 1.5L Forbearance Agreement, attached as Exhibit 10.1 hereto, (ii) the 1.75L Forbearance Agreement, attached as Exhibit 10.2 hereto and (iii) the RBL Forbearance Agreement attached as Exhibit 10.3 herein, each
incorporated herein by reference.
DIP Commitment Letter
On December 20, 2017, the Company entered into a commitment letter for $250 million of senior secured
debtor-in-possession
facilities in connection with a potential filing of voluntary petitions under Chapter 11 of the U.S. Bankruptcy Code.
Item 7.01.
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Regulation FD Disclosure.
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On December 21, 2017, the Company issued a press release
announcing the Forbearance Agreements and the receipt of the
debtor-in-possession
financing commitment. A copy of the press release is attached hereto as Exhibit 99.1
and is incorporated by reference herein.
No decision by the Obligors to file a petition under Chapter 11 of the U.S. Bankruptcy Code has
been made at this time. The Forbearance Agreements are intended to provide the Obligors an opportunity to negotiate a restructuring transaction and the debtor-in-possession financing commitment is intended to provide the Company with necessary
liquidity should the Company file a Chapter 11 proceeding. The Company is negotiating the terms of a restructuring with the Forbearing Parties. Until any definitive agreements are negotiated in their entirety and executed, and the transactions
contemplated thereby are consummated, there can be no assurance that any restructuring transaction will be completed by the end of the Forbearance Period or at all. The Company may file a voluntary petition for relief under Chapter 11 of the United
States Bankruptcy Code if the Company is unable to negotiate and implement a restructuring before the end of the Forbearance Period or if any negotiated restructuring requires implementation through a Chapter 11 proceeding.
The information included in this Current Report on Form
8-K
under Item 7.01 is being furnished and
shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the
Exchange Act
), or otherwise subject to liabilities of that Section, unless the registrant specifically
states that the information is to be considered filed under the Exchange Act or incorporates it by reference into a filing under the Exchange Act or the Securities Act of 1933, as amended.
Resignation and Appointment of Trustee: Unsecured Notes
On December 15, 2017, Wilmington Trust Company (the
Resigning Trustee
), resigned as Trustee under the Indenture relating to
its 7.500% Senior Notes due 2018 and its 8.500% Senior Notes due 2022.
The Company entered into an Instrument of Resignation, Appointment
and Acceptance (the
Instrument of Resignation
), dated December 15, 2017 and effective as of December 30, 2017 (the
Effective Date
), with the Resigning Trustee and Wilmington Savings Fund Society, FSB (the
Successor Trustee
). The Instrument of Resignation provides that, effective as of the Effective Date, (1) the Resigning Trustee assigns, transfers, delivers and confirms to the Successor Trustee all of its rights, title,
interest under the Indenture and all of its rights, title, interests, capacities, privileges, duties and responsibilities as Trustee and security registrar under the Indenture; (2) the Company accepts the resignation of the Resigning Trustee as
Trustee and security registrar under the Indenture and appoints the Successor Trustee as Trustee and security registrar under the Indenture; and (3) the Successor Trustee accepts its appointment as successor Trustee and security registrar, and
shall be vested with all of the rights, title, interests, capacities, privileges, duties and responsibilities of the Trustee and security registrar under the Indenture.
The foregoing description does not purport to be complete and is qualified in its entirety by reference to the text of the Instrument of
Resignation, which is filed as Exhibit 4.1 hereto, and is incorporated by reference herein.
Item 9.01.
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Financial Statements and Exhibits.
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The exhibits listed below are filed herewith.
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EXHIBIT
NUMBER
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EXHIBIT DESCRIPTION
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4.1
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Instrument of Resignation, Appointment and Acceptance, dated as of December 15, 2017, by and among EXCO Resources, Inc., Wilmington Trust, National Association and Wilmington Savings Fund Society, FSB.
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10.1
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Forbearance Agreement, dated as of December 19, 2017, by and among the Company, the subsidiary guarantors party thereto, and the Supporting Holders.
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10.2
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Forbearance Agreement, dated as of December 19, 2017, by and among the Company, the subsidiary guarantors party thereto, and the 1.75L Supporting Lenders.
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10.3
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Forbearance Agreement, dated as of December
20, 2017, by and among the Company, the subsidiary guarantors party thereto, JPMorgan Chase Bank, N.A., as administrative agent and the RBL Supporting Lenders.
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99.1
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Press release, dated December 21, 2017, issued by EXCO Resources, Inc.
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Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly
caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
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EXCO RESOURCES, INC.
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Date: December 21, 2017
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By:
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/s/ Heather L. Lamparter
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Name:
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Heather L. Lamparter
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Title:
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Vice President, General Counsel and Secretary
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