Item 1.01. Entry into a Material Definitive Agreement.
On February 20, 2014, Diamondback Energy, Inc. ("Diamondback Energy") entered
into an Underwriting Agreement (the "Underwriting Agreement") with Credit Suisse
Securities (USA) LLC, as representative of the several underwriters named
therein (the "Underwriters"). The Underwriting Agreement relates to a public
offering by Diamondback Energy of 3,000,000 shares of its common stock at a
public offering price of $62.67 per share (less the underwriting discount) (the
"Firm Shares Offering"). Pursuant to the Underwriting Agreement, Diamondback
Energy granted the Underwriters a 30-day option to purchase up to 450,000
additional shares of its common stock at the public offering price (less the
underwriting discount) (the "Optional Shares Offering" and, together with the
Firm Shares Offering, the "Offering"), which option was exercised by the
Underwriters in full on February 21, 2014. Diamondback Energy intends to use the
net proceeds from the Offering and borrowings under its revolving credit
facility to fund its previously announced acquisitions of additional acreage in
Martin County, Texas in the Permian Basin (the "Pending Acquisitions"). To the
extent the Pending Acquisitions are not consummated, Diamondback Energy intends
to use the net proceeds from the Offering to fund a portion of its exploration
and development activities and for general corporate purposes, which may include
leasehold interest and property acquisitions and working capital. The Offering
closed on February 26, 2014.
The Underwriting Agreement contains customary representations, warranties and
agreements of Diamondback Energy and other customary obligations of the parties
and termination provisions. The Underwriting Agreement also provides for the
indemnification by Diamondback Energy of the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933, as amended
(the "Securities Act").
The Offering was made pursuant to Diamondback Energy's effective automatic shelf
registration statement on Form S-3 (File No. 333-192099), filed with the
Securities and Exchange Commission (the "SEC") on November 5, 2013 (the "Shelf
Registration Statement"), and a prospectus, which consists of a base prospectus,
filed with the SEC on November 5, 2013, a preliminary prospectus supplement,
filed with the SEC on February 20, 2014, and a final prospectus supplement,
filed with the SEC on February 21, 2014 (collectively, the "Prospectus").
Certain of the Underwriters and their respective affiliates have from time to
time performed, and may in the future perform, various financial advisory,
commercial banking and investment banking services for Diamondback Energy and
its affiliates in the ordinary course of business for which they have received
and would receive customary compensation. Affiliates of Capital One Securities,
Inc., Credit Suisse Securities (USA) LLC, IBERIA Capital Partners L.L.C, Scotia
Capital (USA) Inc., SunTrust Robinson Humphrey, Inc. and Wells Fargo Securities,
LLC, each an Underwriter in the Offering, are lenders under Diamondback Energy's
revolving credit facility. In addition, an affiliate of Wells Fargo Securities,
LLC has served as administrative agent under Diamondback Energy's revolving
credit facility, for which it has received customary fees and reimbursement of
expenses. Pursuant to Diamondback Energy's revolving credit facility, it has
agreed to indemnify the lenders and agents under that agreement against a
variety of liabilities and to reimburse certain expenses. Additionally, an
affiliate of Wells Fargo Securities, LLC is a counterparty to certain of
Diamondback Energy's hedging transactions.
The preceding summary of the Underwriting Agreement is qualified in its entirety
by reference to the full text of such agreement, a copy of which is attached as
Exhibit 1.1 hereto and incorporated herein by reference.
Item 7.01. Regulation FD Disclosure.
On February 20, 2014 and February 26, 2014, Diamondback Energy issued press
releases announcing the pricing and the closing, respectively, of the Offering.
Copies of the press releases are attached as Exhibit 99.1 and 99.2,
respectively, to this Current Report on Form 8-K.
Item 8.01. Other Events.
In connection with the Offering, Diamondback Energy is filing a legal opinion of
Akin, Gump, Strauss, Hauer & Feld, L.L.P., attached as Exhibit 5.1 to this
Current Report on Form 8-K, to incorporate such opinion by reference into the
Shelf Registration Statement and into the Prospectus.
Item 9.01. Financial Statements and Exhibits.
1.1* Underwriting Agreement, dated February 20, 2014, by and between
Diamondback Energy, Inc. and Credit Suisse Securities (USA) LLC, as
representative of the several underwriters.
5.1* Opinion of Akin, Gump, Strauss, Hauer & Feld, L.L.P.
23.1* Consent of Akin, Gump, Strauss, Hauer & Feld, L.L.P. (included in
99.1** Press release dated February 20, 2014 entitled "Diamondback Energy
Announces Pricing of Common Stock Offering."
99.2** Press release dated February 26, 2014 entitled "Diamondback Energy
Announces Closing of Common Stock Offering."
* Filed herewith.
** Furnished herewith.