Item 1.01 – Entry into a Material Definitive Agreement.
Purchase Agreement
On November 10, 2020, Continental Resources, Inc. (the “Company”) and its subsidiaries, Banner Pipeline Company, L.L.C., CLR Asset Holdings, LLC and The Mineral Resources Company (collectively, the “Initial Guarantors”), entered into a Purchase Agreement (the “Purchase Agreement”) with BofA Securities, Inc. as the representative of the several initial purchasers (collectively, the “Initial Purchasers”), relating to the issuance and sale of $1.5 billion in aggregate principal amount of the Company’s 5.75% senior notes due 2031 (the “Notes”), which offering was upsized from the originally proposed $1.0 billion offering. The Notes were offered and will be sold in a transaction exempt from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”). The Notes will be resold to qualified institutional buyers under Rule 144A of the Securities Act and outside the United States to non-U.S. persons in compliance with Regulation S of the Securities Act.
The Purchase Agreement contains customary representations and warranties of the parties and indemnification and contribution provisions under which the Company and the Initial Guarantors, on one hand, and the Initial Purchasers, on the other, have agreed to indemnify each other against certain liabilities, including liabilities under the Securities Act. A copy of the Purchase Agreement is filed as Exhibit 10.1 to this Current Report on Form 8-K (“Form 8-K”) and is incorporated herein by reference. The description of the Purchase Agreement in this report is a summary and is qualified in its entirety by the terms of the Purchase Agreement.
Relationships
Certain of the Initial Purchasers and certain of their affiliates have provided, and may in the future provide, various investment banking, commercial banking and other financial services to the Company and the Initial Guarantors, for which services they have received and may in the future receive customary fees. Affiliates of certain of the Initial Purchasers are lenders under the Company’s revolving credit facility. The Company intends to use a portion of the excess net proceeds, if any, from the offering of the Notes to repay a portion of the borrowings outstanding under the revolving credit facility. Therefore, affiliates of certain of the Initial Purchasers may be repaid with a portion of the net proceeds of the offering of the Notes. Additionally, the Company intends to use a portion of the net proceeds from the offering to purchase Target Notes in the Tender Offers (each as defined hereafter). Certain of the Initial Purchasers or their affiliates may hold a portion of the Company’s 5.0% senior notes due 2022 and 4.5% senior notes due 2023 (collectively the “Target Notes”) that may be purchased in tender offers commenced by the Company to purchase the Target Notes for cash (the “Tender Offers”), and such Initial Purchasers or their affiliates thereby may receive a portion of the net proceeds from the offering.
Item 8.01 – Other Events.
On November 10, 2020, the Company issued a press release announcing the pricing of the upsized offering of the Notes. A copy of the Company’s press release is filed as Exhibit 99.1 to this Form 8-K and is incorporated herein by reference.
The press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any state in which the offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such state.
Item 9.01 – Financial Statements and Exhibits.
(d) Exhibits.
