UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of The Securities Exchange Act of 1934
Date of report (Date of earliest event reported): April 3, 2018
STONE ENERGY CORPORATION
(Exact Name of Registrant as Specified in its Charter)
Delaware | 1-12074 | 72-1235413 | ||
(State or Other Jurisdiction of Incorporation) |
(Commission File Number) |
(I.R.S. Employer Identification No.) |
625 E. Kaliste Saloom Road
Lafayette, Louisiana, 70508
(Address of Principal Executive Offices)
Registrants telephone number, including area code: (337) 237-0410
N/A
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☒ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 1.01. | Entry Into a Material Definitive Agreement. |
As previously disclosed, on November 21, 2017, Stone Energy Corporation (the Company ) and certain of its subsidiaries, Sailfish Energy Holdings Corporation ( New Talos ) and Sailfish Merger Sub Corporation, entered into a Transaction Agreement (the Transaction Agreement ) with Talos Energy LLC ( Talos Energy ) and its indirect wholly owned subsidiary, Talos Production LLC ( Talos Production ), pursuant to which the Company and Talos Energy agreed to combine in an all-stock transaction. In connection with the combination of the Company and Talos Energy, Talos Production and Talos Production Finance Inc. (together with Talos Production, the Talos Issuers ) launched an offer to exchange (the Exchange Offer ) the Companys outstanding 7.5% senior secured notes due 2022 (the Stone Notes ) for a combination of new 11.0% second-priority senior secured notes due 2022 of the Talos Issuers and cash, as more fully described in the Exchange Offer. Concurrently with the Exchange Offer, the Talos Issuers solicited consents from the holders of the Stone Notes to adopt certain proposed amendments to the indenture governing the Stone Notes (the Stone Notes Indenture ) and to release the collateral securing the obligations under the Stone Notes.
The early tender and withdrawal deadline for the Exchange Offer and consent solicitation occurred on April 2, 2018 at 5:00 p.m., New York City time (the Early Deadline ). As of the Early Deadline, the Talos Issuers received sufficient consents, which consents are no longer subject to withdrawal, from holders of the Stone Notes to effect the proposed amendments to the Stone Notes Indenture and release the collateral securing the obligations under the Stone Notes. The proposed amendments and the release of collateral, to be effected by the Supplemental Indentures referred to below, will not become operative until immediately prior to the delivery of the consideration for the Stone Notes on the closing date of the transactions contemplated by the Transaction Agreement.
On April 3, 2018, the Company entered into Supplemental Indenture No. 1 (the First Supplemental Indenture ) with Stone Energy Offshore, L.L.C., as subsidiary guarantor, and The Bank of New York Mellon Trust Company, N.A., as trustee and collateral agent, which, upon becoming operative, will eliminate (i) substantially all of the restrictive covenants, (ii) certain reporting obligations, (iii) all events of default other than the failure to pay principal, premium or interest on the Stone Notes and the commencement of bankruptcy proceedings or an order under bankruptcy law, in each case, with respect to the Company and (iv) certain provisions related to the foregoing contained in the Stone Notes Indenture. The restrictive covenants in the Stone Notes Indenture that will be eliminated upon the First Supplemental Indenture becoming operative include those relating to an offer to repurchase upon change of control, incurrence of indebtedness and issuance of preferred stock, restricted payments, liens, restrictions on distributions from restricted subsidiaries, sales of assets and subsidiary stock, transactions with affiliates, additional subsidiary guarantors, and certain conditions to a consolidation by the Company.
On April 3, 2018, the Company also entered into Supplemental Indenture No. 2 (the Second Supplemental Indenture and, together with the First Supplemental Indenture, the Supplemental Indentures ) with Stone Energy Offshore, L.L.C., as subsidiary guarantor, and The Bank of New York Mellon Trust Company, N.A., as trustee and collateral agent, to release all of the collateral securing the obligations under the Stone Notes and to eliminate the restrictive covenant in the Stone Notes Indenture related to after acquired property. As a result, upon the Second Supplemental Indenture becoming operative, the obligations under the Stone Notes will no longer be secured.
The description of the Supplemental Indentures is qualified in its entirety by reference to the full text of the Supplemental Indentures, copies of which are attached as Exhibit 10.1 and Exhibit 10.2 to this Current Report on Form 8-K and are incorporated into this Item 1.01 by reference.
Item 3.03. | Material Modification to Rights of Security Holders. |
The information set forth in Item 1.01 is incorporated into this Item 3.03 by reference.
Important Additional Information
In connection with the proposed transaction, New Talos has filed with the Securities and Exchange Commission (the SEC ) a registration statement on Form S-4, including Amendments No. 1, 2, 3 and 4 thereto. The registration statement was declared effective by the SEC on April 9, 2018. New Talos has also filed with the SEC a definitive consent solicitation/prospectus. The Company will mail the definitive consent solicitation/prospectus to its stockholders and file other documents regarding the proposed transaction with the SEC. This communication is not a substitute for any proxy statement, registration statement, proxy statement/prospectus or other documents the Company and/or New Talos may file with the SEC in connection with the proposed transaction. INVESTORS AND STOCKHOLDERS OF THE COMPANY ARE URGED TO READ CAREFULLY AND IN THEIR ENTIRETY THE REGISTRATION STATEMENT AND THE CONSENT SOLICITATION/ PROSPECTUS REGARDING THE PROPOSED TRANSACTION AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. Investors and stockholders may obtain a free copy of the consent solicitation/prospectus, as well as other filings containing information about Talos Energy, the Company and/or New Talos, without charge, at the SECs website (http://www.sec.gov). Copies of the consent solicitation/prospectus and the filings with the SEC that are incorporated by reference in the consent solicitation/prospectus may also be obtained, without charge, from the Company by directing a request to Stone Energy Corporation, 625 E. Kaliste Saloom Road, Lafayette, Louisiana, 70508, Attention: Investor Relations, Telephone: (337) 237-0410, or from Talos Energy by directing a request to Bill Moss, General Counsel of Talos Energy, via email or telephone (bmoss@talosenergyllc.com), 713-328-3005.
No Offer or Solicitation
This communication is for informational purposes only and is not intended to and does not constitute an offer to subscribe for, buy or sell, the solicitation of an offer to subscribe for, buy or sell or an invitation to subscribe for, buy or sell any securities or the solicitation of any vote or approval in any jurisdiction pursuant to or in connection with the proposed transaction or otherwise, nor shall there be any sale, issuance or transfer of securities in any jurisdiction in contravention of applicable law. No offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended, and otherwise in accordance with applicable law.
Participants in the Solicitation
Talos Energy, the Company, New Talos and certain of their respective directors, executive officers and members of management and employees may be deemed to be participants in the solicitation of written consents in respect of the proposed transaction. Information regarding the Companys directors and executive officers is set forth in the Companys Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. Information regarding Talos Energys directors and executive officers and more detailed information regarding the identity of all potential participants, and their direct and indirect interests, by security holdings or otherwise, is set forth in the consent solicitation/prospectus and other relevant materials filed with the SEC. Free copies of these documents may be obtained from the sources indicated above.
Item 9.01. | Financial Statements and Exhibits. |
(d) Exhibits.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
STONE ENERGY CORPORATION | ||||||
Date: April 9, 2018 | By: |
/s/ Lisa S. Jaubert |
||||
Name: | Lisa S. Jaubert | |||||
Title: | Senior Vice President, General Counsel and Secretary |
Exhibit 10.1
Execution Version
SUPPLEMENTAL INDENTURE NO. 1
SUPPLEMENTAL INDENTURE NO. 1, dated as of April 3, 2018 (this Supplemental Indenture ), by and between Stone Energy Corporation, a Delaware corporation (the Issuer ), Stone Energy Offshore, L.L.C., as subsidiary guarantor (the Subsidiary Guarantor ), and The Bank of New York Mellon Trust Company, N.A., as trustee (in such capacity, the Trustee ) and collateral agent (in such capacity, the Collateral Agent ).
W I T N E S S E T H
WHEREAS, the Issuer, the Subsidiary Guarantor, the Trustee and the Collateral Agent are party to that certain Indenture, dated as of February 28, 2017 (the Indenture ), providing for the issuance of the Issuers 7.500% Senior Secured Notes due 2022 (the Notes );
WHEREAS, Section 1002 of the Indenture provides, inter alia , that, in certain circumstances, the Issuer, the Subsidiary Guarantor, the Trustee and the Collateral Agent may amend the Indenture, the Notes and the other Note Documents with the consent of the Holders of not less than a majority in principal amount of the Outstanding Notes (the Requisite Consents );
WHEREAS, Talos Production LLC, a Delaware limited liability company ( Talos Production ), and Talos Production Finance Inc., a Delaware corporation ( Talos Finance and, together with Talos Production, the Talos Issuers ), have distributed an Offer to Exchange and Consent Solicitation Statement, dated March 20, 2018 (the Statement ), and an accompanying Consent and Letter of Transmittal to the holders of the Notes in connection with the offer to exchange the outstanding Notes and the concurrent solicitation (the Consent Solicitation ) of consents by the Holders of the Notes embodied in and evidenced by instruments signed by Holders (or agents thereof duly appointed in writing) by electronic transmission transmitted through the facilities of the Depository (the Consents ) to certain proposed amendments to the Indenture as further described in the Statement (the Proposed Amendments );
WHEREAS, the aggregate principal amount of the Outstanding Notes (such term excluding Notes owned by controlling persons specified in the definition thereof in the Indenture for purposes of determining whether Holders of the requisite principal amount of Notes have given any consent as of any date) on the date hereof is $87,562,157;
WHEREAS, the Holders of approximately $75,500,000 (or 86%) (i.e., not less than a majority) in aggregate principal amount of the Outstanding Notes) have validly delivered and not validly withdrawn Consents to the adoption of all of the Proposed Amendments effected by this Supplemental Indenture in accordance with the provisions of the Indenture, such amount of Consents having been certified in writing by Global Bondholder Services Corporation, the exchange agent for the Consent Solicitation; and such Consents have been delivered to the Trustee and Collateral Agent;
WHEREAS, having received the Requisite Consents, pursuant to Section 1002 of the Indenture, the Issuer desires to amend the Indenture, the Notes and the other Note Documents (the Amendment );
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WHEREAS, in accordance with Section 1003 of the Indenture, the Issuer has delivered to the Trustee and Collateral Agent an Officers Certificate and an Opinion of Counsel with respect to this Supplemental Indenture on the date hereof; and
WHEREAS, pursuant to Sections 1002 and 1003 of the Indenture, the Trustee and Collateral Agent are authorized to execute and deliver this Supplemental Indenture.
NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, in order to effect the Amendment, the parties mutually covenant and agree as follows:
ARTICLE I
Defined Terms
Section 1.1 Capitalized Terms . Capitalized terms used herein without being defined herein shall have the meanings assigned to them in the Indenture.
ARTICLE II
Amendments to Article 2Definitions and Other Provisions of General Application
Section 2.1 Section 201 of the Indenture is hereby amended by deleting from such section the following defined terms: Acquired Indebtedness, Additional Assets, Asset Disposition, Asset Disposition Offer, Asset Disposition Offer Amount, Asset Disposition Offer Period, Asset Disposition Purchase Date, Asset Swap, Beneficial Owner, Borrowing Base, Cash Equivalents, Change of Control, Consolidated Coverage Ratio, Consolidated EBITDA, Consolidated Income Tax Expense, Consolidated Interest Expense, Consolidated Net Income, Excluded Accounts, Grantors, Indebtedness, Investment Grade Rating, Investment Grade Rating Event, Moodys, Net Available Cash, Permitted Acquisition Indebtedness, Permitted Business Investment, Permitted Holder, Permitted Investment, Permitted Prior Liens, Rating Agency, Reporting Failure, Restricted Investment, S&P, Sale/Leaseback Transaction, Subordinated Obligations, Voting Stock and any other defined terms references to which in the Indenture as amended by this Supplemental Indenture, have been eliminated as a result of the Proposed Amendments effected by this Supplemental Indenture.
ARTICLE III
Amendments to Article 6Remedies
Section 3.1 Section 601(3) of the Indenture is hereby deleted and amended and restated to read in its entirety as set forth below:
(3) [Intentionally omitted];.
Section 3.2 Section 601(4) of the Indenture is hereby deleted and amended and restated to read in its entirety as set forth below:
(4) [Intentionally omitted];.
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Section 3.3 Section 601(5) of the Indenture is hereby deleted and amended and restated to read in its entirety as set forth below:
(5) [Intentionally omitted];.
Section 3.4 Section 601(6) of the Indenture is hereby deleted and amended and restated to read in its entirety as set forth below:
(6) [Intentionally omitted];.
Section 3.5 Section 601(7) of the Indenture is hereby deleted and amended and restated to read in its entirety as set forth below:
(7) the entry by a court having jurisdiction in the premises of (A) a decree or order for relief in respect of the Company in an involuntary case or proceeding under any applicable Federal or State bankruptcy, insolvency, reorganization or other similar law or (B) a decree or order adjudging the Company a bankrupt or insolvent, or approving as properly filed a petition seeking reorganization, arrangement, adjustment or composition of or in respect of the Company, under any applicable Federal or State law, or appointing a custodian, receiver, liquidator, assignee, trustee, sequestrator or other similar official of the Company, or of any substantial part of its property, or ordering the winding up or liquidation of its affairs, and the continuance of any such decree or order for relief or any such other decree or order unstayed and in effect for a period of 60 consecutive days; or.
Section 3.6 Section 601(8) of the Indenture is hereby deleted and amended and restated to read in its entirety as set forth below:
(8) the commencement by the Company of a voluntary case or proceeding under any applicable Federal or State bankruptcy, insolvency, reorganization or other similar law or of any other case or proceeding to be adjudicated a bankrupt or insolvent, or the consent by it to the entry of a decree or order for relief in respect of the Company or in an involuntary case or proceeding under any applicable Federal or State bankruptcy, insolvency, reorganization or other similar law or to the commencement of any bankruptcy or insolvency case or proceeding against it, or the filing by it of a petition or answer or consent seeking reorganization or relief under any applicable Federal or State law, or the consent by it to the filing of such petition or to the appointment of or taking possession by a custodian, receiver, liquidator, assignee, trustee, sequestrator or other similar official of the Company or of any substantial part of its property, or the making by it of an assignment for the benefit of creditors, or the admission by it in writing of its inability to pay its debts generally as they become due, or the taking of corporate action by the Company in furtherance of any such action; or.
Section 3.7 Section 601(9) of the Indenture is hereby deleted and amended and restated to read in its entirety as set forth below:
(9) [Intentionally omitted];.
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Section 3.8 Section 601(10) of the Indenture is hereby deleted and amended and restated to read in its entirety as set forth below:
(10) [Intentionally omitted];.
Section 3.1 Section 601(11) of the Indenture is hereby deleted and amended and restated to read in its entirety as set forth below:
(11) [Intentionally omitted];.
ARTICLE IV
Amendments to Article 8Holders Lists and Reports by Trustee and Company
Section 4.1 Section 804 of the Indenture is hereby deleted and amended and restated to read in its entirety as set forth below:
Section 804. [Intentionally omitted]..
ARTICLE V
Amendments to Article 9Consolidation, Merger, Conveyance, Transfer or Lease
Section 5.1 Section 901(3) of the Indenture is hereby deleted and amended and restated to read in its entirety as set forth below:
(3) [Intentionally omitted];.
ARTICLE VI
Amendments to Article 11Covenants
Section 6.1 Section 1107 of the Indenture is hereby deleted and amended and restated to read in its entirety as set forth below:
Section 1107. [Intentionally omitted]..
Section 6.2 Section 1110 of the Indenture is hereby deleted and amended and restated to read in its entirety as set forth below:
Section 1110. [Intentionally omitted]..
Section 6.3 Section 1111 of the Indenture is hereby deleted and amended and restated to read in its entirety as set forth below:
Section 1111. [Intentionally omitted]..
Section 6.4 Section 1112 of the Indenture is hereby deleted and amended and restated to read in its entirety as set forth below:
Section 1112. [Intentionally omitted]..
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Section 6.5 Section 1113 of the Indenture is hereby deleted and amended and restated to read in its entirety as set forth below:
Section 1113. [Intentionally omitted]..
Section 6.6 Section 1114 of the Indenture is hereby deleted and amended and restated to read in its entirety as set forth below:
Section 1114. [Intentionally omitted]..
Section 6.7 Section 1115 of the Indenture is hereby deleted and amended and restated to read in its entirety as set forth below:
Section 1115. [Intentionally omitted]..
Section 6.8 Section 1116 of the Indenture is hereby deleted and amended and restated to read in its entirety as set forth below:
Section 1116. [Intentionally omitted]..
Section 6.9 Section 1117 of the Indenture is hereby deleted and amended and restated to read in its entirety as set forth below:
Section 1117. [Intentionally omitted]..
Section 6.10 Section 1119 of the Indenture is hereby deleted and amended and restated to read in its entirety as set forth below:
Section 1119. [Intentionally omitted]..
ARTICLE VII
Effectiveness
Section 7.1 Effectiveness . This Supplemental Indenture shall be effective and binding immediately upon its execution and delivery by the Company, the Subsidiary Guarantor, the Trustee and the Collateral Agent, and thereupon this Supplemental Indenture shall form a part of the Indenture for all purposes, and every Note and Note Guarantee heretofore or hereafter authenticated and delivered under the Indenture shall be bound hereby. Except as modified and amended by this Supplemental Indenture, all provisions of the Indenture shall remain in full force and effect. Notwithstanding the foregoing, the provisions of Articles II through VI hereof shall not become operative until immediately prior to the delivery of, as the case may be, the Total Consideration (as defined in the Statement) or the Exchange Consideration (as defined in the Statement) on the Settlement Date (as defined in the Statement).
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ARTICLE VIII
Miscellaneous
Section 8.1 Incorporation . All provisions of this Supplemental Indenture shall be deemed to be incorporated in, and made a part of, the Indenture, and the Indenture, as amended and supplemented by this Supplemental Indenture, shall be read, taken and construed as one and the same instrument.
Section 8.2 Third Parties . Nothing in this Supplemental Indenture, express or implied, shall give to any Person, other than the parties hereto and their successors under the Indenture and the Holders of the Notes, any benefit or any legal or equitable right, remedy or claim under the Indenture.
Section 8.3 Governing Law . THIS SUPPLEMENTAL INDENTURE WILL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
Section 8.4 Conflict with Trust Indenture Act . If any provision of this Supplemental Indenture limits, qualifies or conflicts with any provision of the Trust Indenture Act that may not be so limited, qualified or conflicted with, such provision of the Trust Indenture Act shall control. If any provision of this Supplemental Indenture modifies or excludes any provision of the Trust Indenture Act that may be so modified or excluded, such provision of the Trust Indenture Act shall be deemed to apply to the Indenture as so modified or to be excluded by this Supplemental Indenture, as the case may be.
Section 8.5 Counterparts . The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the same agreement. The exchange of copies of this Supplemental Indenture and of signature pages by facsimile or electronic (including in .pdf or tif format) transmissions shall constitute effective execution and delivery of this Supplemental Indenture as to the parties hereto and may be used in lieu of the original Supplemental Indenture for all purposes. Signatures of the parties hereto transmitted by facsimile or electronically (including in .pdf or tif format) shall be deemed to be their original signatures for all purposes.
Section 8.6 Effect of Headings . The Article and Section headings herein are for convenience only and shall not affect the construction hereof.
Section 8.7 The Trustee and Collateral Agent . The Trustee and Collateral Agent shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Supplemental Indenture or for or in respect of the recitals contained herein, all of which recitals are made solely by the Issuer.
Section 8.8 Successors . All agreements of the Issuer in this Supplemental Indenture shall bind its successors, except as otherwise provided in this Supplemental Indenture. All agreements of the Trustee and Collateral Agent in this Supplemental Indenture shall bind their successors.
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Section 8.9 Severability Clause . In case any provision in this Supplemental Indenture shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.
[ Remainder of page intentionally left blank .]
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IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture No. 1 to be duly executed as of the date first written above.
ISSUER | ||
STONE ENERGY CORPORATION | ||
By: |
/s/ Kenneth H. Beer |
|
Name: | Kenneth H. Beer | |
Title: | Executive Vice President and Chief Financial Officer | |
SUBSIDIARY GUARANTOR | ||
STONE ENERGY OFFSHORE, L.L.C. | ||
By: |
/s/ Kenneth H. Beer |
|
Name: | Kenneth H. Beer | |
Title: | Executive Vice President and Chief Financial Officer | |
TRUSTEE | ||
THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., not in its individual capacity but solely as Trustee | ||
By: |
/s/ R. Tarnas |
|
Name: | R. Tarnas | |
Title: | Vice President | |
COLLATERAL AGENT | ||
THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., not in its individual capacity but solely as Collateral Agent | ||
By: |
/s/ R. Tarnas |
|
Name: | R. Tarnas | |
Title: | Vice President |
[ Signature Page to Supplemental Indenture No. 1 ]
Exhibit 10.2
Execution Version
SUPPLEMENTAL INDENTURE NO. 2
SUPPLEMENTAL INDENTURE NO. 2, dated as of April 3, 2018 (this Supplemental Indenture ), by and between Stone Energy Corporation, a Delaware corporation (the Issuer ), Stone Energy Offshore, L.L.C., as subsidiary guarantor (the Subsidiary Guarantor ), and The Bank of New York Mellon Trust Company, N.A., as trustee (in such capacity, the Trustee ) and collateral agent (in such capacity, the Collateral Agent ).
W I T N E S S E T H
WHEREAS, the Issuer, the Subsidiary Guarantor, the Trustee and the Collateral Agent are party to that certain Indenture, dated as of February 28, 2017 (as supplemented by that certain Supplemental Indenture No. 1, dated as of April 3, 2018, the Indenture ), providing for the issuance of the Issuers 7.500% Senior Secured Notes due 2022 (the Notes );
WHEREAS, Section 1002 of the Indenture provides, inter alia , that the Issuer, the Subsidiary Guarantor, the Trustee and the Collateral Agent may amend the Indenture, the Notes and the other Note Documents to release all or substantially all of the Collateral from the Liens securing the Notes with the consent of the Holders of at least 66 2/3% in principal amount of the Outstanding Notes (the Collateral Release Requisite Consents );
WHEREAS, Talos Production LLC, a Delaware limited liability company ( Talos Production ) and Talos Production Finance Inc., a Delaware corporation ( Talos Finance and, together with Talos Production, the Talos Issuers ), have distributed an Offer to Exchange and Consent Solicitation Statement, dated March 20, 2018 (the Statement ), and an accompanying Consent and Letter of Transmittal to the holders of the Notes in connection with the offer to exchange the outstanding Notes and the concurrent solicitation (the Consent Solicitation ) of consents by the Holders of the Notes embodied in and evidenced by instruments signed by Holders (or agents thereof duly appointed in writing) by electronic transmission transmitted through the facilities of the Depository (the Consents ) to certain proposed amendments to the Indenture as further described in the Statement (the Proposed Amendments );
WHEREAS, the aggregate principal amount of the Outstanding Notes (such term excluding Notes owned by controlling persons specified in the definition thereof in the Indenture for purposes of determining whether Holders of the requisite principal amount of Notes have given any consent as of any date) on the date hereof is $87,541,008;
WHEREAS, the Holders of approximately $75,300,000 (or 86%) (i.e., not less than 66 2/3%) in aggregate principal amount of the Outstanding Notes) have validly delivered and not validly withdrawn Consents to the adoption of all of the Proposed Amendments effected by this Supplemental Indenture in accordance with the provisions of the Indenture, such amount of Consents having been certified in writing by Global Bondholder Services Corporation, the exchange agent for the Consent Solicitation; and such Consents have been delivered to the Trustee and Collateral Agent;
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WHEREAS, having received the Collateral Release Requisite Consents, pursuant to Section 1002 of the Indenture, the Issuer desires to amend the Indenture, the Notes and the other Note Documents (the Amendment );
WHEREAS, in accordance with Section 1003 of the Indenture, the Issuer has delivered to the Trustee and Collateral Agent an Officers Certificate and an Opinion of Counsel with respect to this Supplemental Indenture on the date hereof; and
WHEREAS, pursuant to Sections 1002 and 1003 of the Indenture, the Trustee and Collateral Agent are authorized to execute and deliver this Supplemental Indenture.
NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, in order to effect the Amendment, the parties mutually covenant and agree as follows:
ARTICLE I
Defined Terms
Section 1.1 Capitalized Terms . Capitalized terms used herein without being defined herein shall have the meanings assigned to them in the Indenture.
ARTICLE II
Amendments to Article 2Definitions and Other Provisions of General Application
Section 2.1 Section 201 of the Indenture is hereby amended by deleting from such section the following defined terms: Action, Adjusted Consolidated Net Tangible Assets, After Acquired Property, Capitalized Lease Obligations, Communications Laws, Dollar Denominated Production Payments, Excluded Collateral, FCC, FCC License, Modified ACNTA, Modified ACNTA Prices, Net Working Capital, Permitted Liens, Production Payments and Reserve Sales, Related Person, Secured Obligations, Security Document Order, Volumetric Production Payments and any other defined terms references to which in the Indenture as amended by this Supplemental Indenture have been eliminated as a result of the Proposed Amendments effected by this Supplemental Indenture.
ARTICLE III
Amendments to Article 11Covenants
Section 3.1 Section 1118 of the Indenture is hereby deleted and amended and restated to read in its entirety as set forth below:
Section 1118. [Intentionally omitted]..
ARTICLE IV
Amendments to Article 13Security
Section 4.1 Section 1301 of the Indenture is hereby deleted and amended and restated to read in its entirety as set forth below:
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Section 1301. [Intentionally omitted]..
Section 4.2 Section 1303 of the Indenture is hereby deleted and amended and restated to read in its entirety as set forth below:
Section 1303. [Intentionally omitted]..
Section 4.3 Section 1304 of the Indenture is hereby deleted and amended and restated to read in its entirety as set forth below:
Section 1304. [Intentionally omitted]..
Section 4.4 Section 1306 of the Indenture is hereby deleted and amended and restated to read in its entirety as set forth below:
Section 1306. [Intentionally omitted]..
Section 4.5 Section 1307 of the Indenture is hereby deleted and amended and restated to read in its entirety as set forth below:
Section 1307. [Intentionally omitted]..
Section 4.6 Section 1308 of the Indenture is hereby deleted and amended and restated to read in its entirety as set forth below:
Section 1308. [Intentionally omitted]..
Section 4.7 Section 1309 of the Indenture is hereby deleted and amended and restated to read in its entirety as set forth below:
(a) [Intentionally omitted].
(b) Any release of Collateral permitted by Section 1305 shall be deemed not to impair the Liens under this Indenture and the Security Agreement and the other Security Documents in contravention thereof. Any certificate or opinion required under Trust Indenture Act § 314(d) may be made by an officer or legal counsel, as applicable, of the Company except in cases where Trust Indenture Act § 314(d) requires that such certificate or opinion be made by an independent Person, which Person shall be an independent engineer, appraiser or other expert selected by the Company.
(c) [Intentionally omitted].
(d) [Intentionally omitted].
(e) [Intentionally omitted]..
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Section 4.8 Section 1310 of the Indenture is hereby deleted and amended and restated to read in its entirety as set forth below:
Section 1310. [Intentionally omitted]..
Section 4.9 Section 1311 of the Indenture is hereby deleted and amended and restated to read in its entirety as set forth below:
Section 1311. [Intentionally omitted]..
ARTICLE V
Releases
Section 5.1 Without any further action by any party hereto, all Collateral securing the Obligations of the Issuer and the Subsidiary Guarantor under the Notes and the Indenture is hereby released, and the Trustee and the Collateral Agent are authorized and instructed to execute all releases, termination statements and other documents reasonably requested by the Issuer and the Subsidiary Guarantor to evidence such release and termination of all Security Documents.
ARTICLE VI
Effectiveness
Section 6.1 Effectiveness . This Supplemental Indenture shall be effective and binding immediately upon its execution and delivery by the Company, the Subsidiary Guarantor, the Trustee and the Collateral Agent, and thereupon this Supplemental Indenture shall form a part of the Indenture for all purposes, and every Note and Note Guarantee heretofore or hereafter authenticated and delivered under the Indenture shall be bound hereby. Except as modified and amended by this Supplemental Indenture, all provisions of the Indenture shall remain in full force and effect. Notwithstanding the foregoing, the provisions of Articles II through V hereof shall not become operative until immediately prior to the delivery of, as the case may be, the Total Consideration (as defined in the Statement) or the Exchange Consideration (as defined in the Statement) on the Settlement Date (as defined in the Statement).
ARTICLE VII
Miscellaneous
Section 7.1 Incorporation . All provisions of this Supplemental Indenture shall be deemed to be incorporated in, and made a part of, the Indenture, and the Indenture, as amended and supplemented by this Supplemental Indenture, shall be read, taken and construed as one and the same instrument.
Section 7.2 Third Parties . Nothing in this Supplemental Indenture, express or implied, shall give to any Person, other than the parties hereto and their successors under the Indenture and the Holders of the Notes, any benefit or any legal or equitable right, remedy or claim under the Indenture.
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Section 7.3 Governing Law . THIS SUPPLEMENTAL INDENTURE WILL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
Section 7.4 Conflict with Trust Indenture Act . If any provision of this Supplemental Indenture limits, qualifies or conflicts with any provision of the Trust Indenture Act that may not be so limited, qualified or conflicted with, such provision of the Trust Indenture Act shall control. If any provision of this Supplemental Indenture modifies or excludes any provision of the Trust Indenture Act that may be so modified or excluded, such provision of the Trust Indenture Act shall be deemed to apply to the Indenture as so modified or to be excluded by this Supplemental Indenture, as the case may be.
Section 7.5 Counterparts . The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the same agreement. The exchange of copies of this Supplemental Indenture and of signature pages by facsimile or electronic (including in .pdf or tif format) transmissions shall constitute effective execution and delivery of this Supplemental Indenture as to the parties hereto and may be used in lieu of the original Supplemental Indenture for all purposes. Signatures of the parties hereto transmitted by facsimile or electronically (including in .pdf or tif format) shall be deemed to be their original signatures for all purposes.
Section 7.6 Effect of Headings . The Article and Section headings herein are for convenience only and shall not affect the construction hereof.
Section 7.7 The Trustee and Collateral Agent . The Trustee and Collateral Agent shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Supplemental Indenture or for or in respect of the recitals contained herein, all of which recitals are made solely by the Issuer.
Section 7.8 Successors . All agreements of the Issuer in this Supplemental Indenture shall bind its successors, except as otherwise provided in this Supplemental Indenture. All agreements of the Trustee and Collateral Agent in this Supplemental Indenture shall bind their successors.
Section 7.9 Severability Clause . In case any provision in this Supplemental Indenture shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.
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IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture No. 2 to be duly executed as of the date first written above.
ISSUER | ||
STONE ENERGY CORPORATION | ||
By: |
/s/ Kenneth H. Beer |
|
Name: | Kenneth H. Beer | |
Title: | Executive Vice President and Chief Financial Officer | |
SUBSIDIARY GUARANTOR | ||
STONE ENERGY OFFSHORE, L.L.C. | ||
By: |
/s/ Kenneth H. Beer |
|
Name: | Kenneth H. Beer | |
Title: | Executive Vice President and Chief Financial Officer | |
TRUSTEE | ||
THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., not in its individual capacity but solely as Trustee | ||
By: |
/s/ R. Tarnas |
|
Name: | R. Tarnas | |
Title: | Vice President | |
COLLATERAL AGENT | ||
THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., not in its individual capacity but solely as Collateral Agent | ||
By: |
/s/ R. Tarnas |
|
Name: | R. Tarnas | |
Title: | Vice President |
[ Signature Page to Supplemental Indenture No. 2 ]