UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

 

Washington, D.C. 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):  May 1, 2015

 

 

RESOLUTE ENERGY CORPORATION

(Exact name of registrant as specified in its charter)

 

 

 

 

 

 

 

Registrant’s telephone number, including area code:  303-534-4600

 

 

Not Applicable

(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:

 

 

 

 

 

 

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Item 8.01Other Events

 

Closing of Asset Sale

 

On March 27, 2015, Resolute Natural Resources Southwest, LLC, a Delaware limited liability company (“Resolute Southwest”), a wholly-owned subsidiary of Resolute Energy Corporation, a Delaware corporation (the “Company”) entered into a Purchase and Sale Agreement (the “PSA”) with QStar LLC, a privately-held Delaware limited liability company, to sell certain oil and gas properties in the Midland Basin portion of the Permian Basin in Howard and Martin counties, Texas, for a purchase price of $42.1 million, subject to customary purchase price adjustments, including for title and environmental defects (the “Permian Sale”).  On May 1, 2015, Resolute Southwest closed the Permian Sale transaction.  A portion of the purchase price ($2.135 million) has been escrowed in connection with post-closing indemnification rights under the PSA.  The Permian Sale was effective as of March 1, 2015.

 

Upon the closing of the Permian Sale, the Company’s borrowing base under its Second Amended and Restated Credit Agreement, dated as of March 30, 2010, as amended, with Wells Fargo Bank, National Association, as administrative agent, and the lenders party thereto (the “Revolving Credit Facility”), was automatically reduced from $275 million to $270 million.

 

In connection with the Permian Sale, on May 1, 2015, the Company also entered into a letter agreement under the Company’s Secured Term Loan Agreement (the “Second Lien Credit Agreement”) dated December 30, 2014, between the Company, certain subsidiaries of the Company as Guarantors, Bank of Montreal, as Administrative Agent, and the lenders parties thereto (the “Second Lien Lenders”), pursuant to which the Second Lien Lenders waived any required prepayment of Second Lien debt in connection with the Permian Sale.  

 

The proceeds of the Permian Sale will be used to pay down amounts outstanding under the Company’s Revolving Credit Facility.

 

Information About Sold Assets

 

The properties sold by the Company in the Permian Sale are located in Howard and Martin counties, Texas.  The properties sold (i) had estimated proved reserves of 1.8 MMBoe as of December 31, 2014, (ii) produced approximately 610 net Boe per day in the fourth quarter of 2014 (approximately 288 Boe operated and 322 Boe non-operated) and (iii) included 2,197 net acres (745 net acres operated and 1,452 net acres non-operated).

 

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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.