Item 1.01
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Entry into a Material Definitive Agreement.
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On May 18, 2017, RSP Permian, Inc., a
Delaware corporation (the Company), and certain stockholders of the Company (the Selling Stockholders) entered into an Underwriting Agreement (the Underwriting Agreement) with Merrill Lynch, Pierce,
Fenner & Smith Incorporated (the Underwriter) relating to the offer and sale (the Offering) of 15,000,000 shares of the Companys common stock, par value $0.01 per share (the Common Stock) by the
Selling Stockholders at a price to the Underwriter of $38.78 per share, to be resold by the Underwriter to the public at variable prices. Pursuant to the Underwriting Agreement, the Selling Stockholders have granted the Underwriter a
30-day
option to purchase up to an additional 2,250,000 shares of the Common Stock, which option was exercised in full by the Underwriter on May 23, 2017.
The Underwriting Agreement contains customary representations and warranties, agreements and obligations, closing conditions and termination
provisions. The Company and the Selling Stockholders have agreed to indemnify the Underwriter against certain liabilities, including liabilities under the Securities Act of 1933, as amended, and to contribute to payments the Underwriter may be
required to make in the event of any such liabilities.
The Offering is expected to close on May 24, 2017, subject to customary
closing conditions. The Company will not receive any of the proceeds from the Offering.
As more fully described under the caption
Underwriting in the prospectus supplement, dated May 18, 2017, filed with the Securities and Exchange Commission on May 22, 2017 (the Prospectus Supplement), the Underwriter and certain of its affiliates have, from
time to time, performed, and may in the future perform, various commercial and investment banking and financial advisory services for the Company and its affiliates, for which they received or may in the future receive customary fees and expenses.
In particular, among other relationships, Bank of America, N.A., an affiliate of the Underwriter, is a lender under the Companys credit facility. Bank of America, N.A. also acts as a swing line lender and letter of credit issuer in that
facility.
As more fully described under the captions Prospectus Supplement SummaryRecent Developments and Selling
Stockholders in the Prospectus Supplement, the Selling Stockholders and the Company are parties to certain membership interest purchase and sale agreements, and the transactions contemplated by those agreements were consummated on
November 28, 2016 and March 1, 2017, respectively, pursuant to which the Company acquired 100% of the outstanding membership interests of Silver Hill Energy Partners, LLC and Silver Hill E&P II, LLC (collectively, the
Acquisitions). In connection with the Acquisitions, the Company granted registration rights to the shares received by the Selling Stockholders as part of the consideration. The shares sold by the Selling Stockholders in the Offering were
among the shares received by the Selling Stockholders in the Acquisitions. Immediately following the Offering, the Selling Stockholders will own an aggregate of approximately 6.7% of the Companys outstanding common stock.
The foregoing description of the Offering and the Underwriting Agreement is qualified in its entirety by reference to the full text of the
Underwriting Agreement, which is attached as Exhibit 1.1 to this Current Report on Form
8-K
and incorporated in this Item 1.01 by reference.
A legal opinion related to the shares sold pursuant to the Offering is filed herewith as Exhibit 5.1.