HPK HighPeak Energy Inc

 

On October 14, 2022 (the “Fifth Amendment Effective Date”), HighPeak Energy, Inc. (the “Company”), as borrower, Fifth Third Bank, National Association, as the existing administrative agent (the “Existing Agent”), Wells Fargo Bank, National Association, as the new administrative agent (the “New Agent”), the guarantors party thereto and the lenders party thereto entered into that certain Fifth Amendment to Credit Agreement (the “Credit Agreement Amendment”), which, upon effectiveness, amended that certain Credit Agreement, dated as of December 17, 2020 (as amended, restated, amended and restated, supplemented or otherwise modified by (i) that certain First Amendment to Credit Agreement, dated as of June 23, 2021, (ii) that certain Second Amendment to Credit Agreement, dated as of October 1, 2021, (iii) that certain Third Amendment to Credit Agreement, dated as of February 9, 2022, (iv) that certain Fourth Amendment to Credit Agreement, dated as of June 27, 2022 and (v) the Credit Agreement Amendment, (the “Credit Agreement”)), among the Company, Fifth Third Bank, National Association, as administrative agent, the guarantors party thereto and the lenders party thereto to, among other things, (i) increase the elected commitments to $525 million and the borrowing base to $550 million, (ii) require an additional borrowing base redetermination on or about December 1, 2022, (iii) modify the permitted dividends and distributions conditions such that minimum availability under the credit facility must be 25% percent (as opposed to 30% before giving effect to the Credit Agreement Amendment) and (iv) appoint the New Agent as the replacement administrative agent to replace the Existing Agent.

 

In addition, in connection with the Credit Agreement Amendment, to the extent the Company incurs any additional specified unsecured senior, senior subordinated or subordinated future indebtedness between the Fifth Amendment Effective Date and June 30, 2023, the Company’s obligation to reduce the borrowing base by an amount equal to 25% of the principal amount of such additional future indebtedness shall be waived. In connection with the Credit Agreement Amendment, the lenders waived two technical events of default existing with the Credit Agreement, as it existed prior to giving effect to the Credit Agreement Amendment, related to entering into and maintaining certain minimum hedges as of the fiscal quarters ending June 30, 2022 and September 30, 2022 and complying with the required current ratio as of the fiscal quarter ending September 30, 2022.

 

The foregoing description of the Credit Agreement Amendment is qualified in its entirety by reference to the Credit Agreement Amendment, a copy of which is attached hereto as Exhibit 10.1 and is incorporated by reference.