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Item 1.01.
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Entry into a Material Definitive Agreement.
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Purchase Agreement
On July 13, 2021, Laredo Petroleum, Inc. (the “Company”)
and its wholly-owned subsidiaries, Laredo Midstream Services, LLC and Garden City Minerals, LLC (together, the “Guarantors”),
entered into a purchase agreement (the “Purchase Agreement”) with Wells Fargo Securities, LLC, as representative of the several
initial purchasers named in Schedule A to the Purchase Agreement (together, the “Initial Purchasers”), providing for the private
offer and sale by the Company (the “Offering”) of $400.0 million aggregate principal amount of the Company’s 7.75% senior
unsecured notes due 2029 (the “Notes”).
The Notes and the related guarantees have not been and will not be
registered under the Securities Act or any state securities laws and may not be offered or sold in the United States absent registration
or an applicable exemption from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”),
and applicable state securities laws. The notes and the related guarantees were offered and sold only to persons reasonably believed to
be qualified institutional buyers in the United States pursuant to Rule 144A under the Securities Act and outside the United States pursuant
to Regulation S under the Securities Act.
The Offering was made pursuant to an offering memorandum dated
July 13, 2021 and closed on July 16, 2021. The Company received net proceeds from the Offering of approximately $392.0 million
(after deducting underwriting discounts and commissions and estimated offering expenses). The Company intends to use the net
proceeds from the Offering for general corporate purposes, including repaying a portion of the borrowings outstanding under the
Company’s senior secured credit facility (as defined below).
The Purchase Agreement contains customary representations, warranties
and agreements of the Company and customary obligations of the parties and termination provisions. The Company has agreed to indemnify
the Initial Purchasers against certain liabilities, including liabilities under the Securities Act, or to contribute to payments the Initial
Purchasers may be required to make because of any of those liabilities.
The foregoing description of the Purchase Agreement is not complete
and is qualified in its entirety by reference to the full text of the Purchase Agreement, a copy of which is attached hereto as Exhibit
10.1 and incorporated into this Item 1.01 by reference.
Certain of the Initial Purchasers or their affiliates are agents and/or
lenders under the Company’s senior secured credit facility and, accordingly, received a portion of the net proceeds of the Offering.
Some of the Initial Purchasers and their affiliates have engaged in, and may in the future engage in, investment banking and other commercial
dealings in the ordinary course of business with the Company or its affiliates. They have received, or may in the future receive, customary
fees and commissions for these transactions. In addition, in the ordinary course of their business activities, the Initial Purchasers
and their affiliates may make or hold a broad array of investments and actively trade debt and equity securities (or related derivative
securities) and financial instruments (including bank loans) for their own account and for the accounts of their customers. Such investments
and securities activities may involve securities and/or instruments of the Company or its affiliates. Certain of the Initial Purchasers
or their affiliates that have a lending relationship with the Company routinely hedge, or may hedge, their credit exposure to the Company
consistent with their customary risk management policies.
Indenture
On July 16, 2021, in connection with the completion of the Offering,
the Company entered into an indenture, dated as of July 16, 2021 (the “Indenture”), among the Company, the guarantors party
thereto and Wells Fargo Bank, National Association, as trustee (“Wells Fargo”).
The Notes will mature on July 31, 2029 with interest accruing at a
rate of 7.75% per annum and payable semi-annually in cash in arrears on January 31 and July 31 of each year, commencing January 31, 2022.
The Company may redeem, at its option, all or part of the Notes at any time on or after July 31, 2024, at the applicable redemption price
plus accrued and unpaid interest to, but not including, the date of redemption. Further, before July 31, 2024, the Company may on one
or more occasions redeem up to 35% of the aggregate principal amount of the Notes in an amount not exceeding the net proceeds from one
or more private or public equity offerings at a redemption price of 107.750% of the principal amount of the Notes, plus accrued and unpaid
interest to the date of redemption, if at least 65% of the aggregate principal amount of the Notes remains outstanding immediately after
such redemption and the redemption occurs within 180 days of the closing date of each such equity offering.
The Notes are guaranteed on a senior unsecured basis by the Guarantors
and certain of the Company’s future restricted subsidiaries.
The foregoing description of the Indenture is a summary only and is
qualified in its entirety by reference to the complete text of the Indenture, a copy of which is attached hereto as Exhibit 4.1, and incorporated
into this Item 1.01 by reference.
Seventh Amendment to Credit Agreement
On July 16, 2021, the Company entered into the Seventh Amendment (the
“Seventh Amendment”) to the Fifth Amended and Restated Credit Agreement (as amended, the “senior secured credit facility”)
among the Company, as borrower, Wells Fargo, as administrative agent, the Guarantors and the bank signatory thereto. The Seventh Amendment,
among other things, includes technical amendments (including in connection with Eurodollar advances), extends the maturity date by two
years to July 2025 (subject to a springing maturity date of July 29, 2024 if any of the Company’s $600.0 million in aggregate principal
amount of 9½% senior unsecured notes due 2025 are outstanding on such date), increases the applicable margins for advances made
thereunder, increases certain commitment and letter of credit fees, revises certain exceptions to the limitations on the payment of distributions
and the repayment of unsecured debt and decreases the leverage ratio for quarterly periods ending on and after September 30, 2021.
All capitalized terms above that are not defined elsewhere have the
meanings ascribed to them in the Seventh Amendment or the senior secured credit facility, as applicable. The foregoing description of
the Seventh Amendment is a summary only and is qualified in its entirety by reference to the complete text of the Seventh Amendment, a
copy of which is attached hereto as Exhibit 10.2 and incorporated into this Item 1.01 by reference.