FORT WORTH, Texas, Dec. 28, 2015 /PRNewswire/
-- Atlas Resource Partners, L.P. (NYSE:
ARP) ("ARP" or "the Company") announced today
that the Issuers (as defined below) have amended their previously
announced consent solicitation (the "7.75% Notes Consent
Solicitation") for their outstanding 7.75% Senior Notes due 2021
(the "7.75% Notes") (CUSIP 049296AC0) issued by Atlas Resource
Partners Holdings, LLC and Atlas Resource Finance Corporation (each
individually an "Issuer" and together the "Issuers") and guaranteed
by ARP and certain subsidiary
guarantors, to adopt certain proposed amendments to the indenture
governing the 7.75% Notes (the "7.75% Notes Indenture"), to holders
of record as of December 9, 2015 (the
"Record Date"), as described below. The Issuers have been
advised by certain additional significant holders that such holders
will deliver consents with respect to the 7.75% Notes Consent
Solicitation with the amended terms set forth below, which the
Issuers believe will increase the total percentage of consenting
holders to approximately 97%.
Proposed Amendments
The Issuers are now requesting consents from the holders of the
7.75% Notes to make the following amendments:
(1) Increase the fixed dollar amount of secured
indebtedness permitted to be incurred under credit facilities
pursuant to the 7.75% Indenture to $1,000.0
million from $500.0 million.
The Issuers originally requested consents from the holders of the
7.75% Notes to increase such fixed dollar amount to $1,050.0 million from $500.0 million. The use of secured indebtedness
incurred under such basket in exchange for the 7.75% Notes or the
Issuers' 9.25% Notes will be limited to a maximum amount of
$100 million, and the Issuers will be
required to make any offer to exchange the 7.75% Notes for secured
indebtedness of the Issuers incurred under such basket to all
holders of the 7.75% Notes on a pro rata basis and to make any
offer to exchange the 9.25% Notes for secured indebtedness of the
Issuers incurred under such basket to all holders of the 9.25%
Notes on a pro rata basis. The text of this amendment to the 7.75%
Indenture is set forth below:
Section 4.09 of the 7.75% Indenture is to be amended as
follows:
The dollar amount in clause (a) of Section 4.09(b)(1) of the
7.75% Indenture will be changed to $1.0
billion from $500.0 million
and the following proviso is to be added to the end of clause
(a): "provided, however, that no more than
$100 million of Indebtedness may be
Incurred pursuant to this clause (a) to refund, refinance, replace,
exchange, renew, repay, extend, prepay, redeem or retire any of the
Notes or any of the 9.25% Notes by the Issuers or any Subsidiary of
the Issuers in consideration, in whole or in part, for secured
Indebtedness of the Issuers or any Subsidiary of the Issuers and,
provided, further, that (x) any offer to refund, refinance,
replace, exchange, renew, repay, extend, prepay, redeem or retire
any of the Notes in consideration, in whole or in part, for
secured Indebtedness of the Issuers or any Subsidiary of the
Issuers Incurred pursuant to this clause (a) shall be made to all
holders of the Notes on a pro rata basis and (y) any offer to
refund, refinance, replace, exchange, renew, repay, extend, prepay,
redeem or retire any of the 9.25% Notes in consideration, in whole
or in part, for secured Indebtedness of the Issuers or any
Subsidiary of the Issuers Incurred pursuant to this clause (a)
shall be made to all holders of the 9.25% Notes on a pro rata
basis; and, provided, further, for purposes of
clarification, nothing in this paragraph shall limit the Issuers,
ARP or any Subsidiary of the
Issuers from purchasing the Notes or the 9.25% Notes entirely for
cash."
In addition, the following definition will be added to Section
1.01 of the 7.75% Indenture:
"9.25% Notes" means the Issuers' 9.25% senior notes due
2021.
(2) Add an additional covenant providing that ARP will not permit its consolidated senior
secured interest expense to exceed the greater of $80 million in any fiscal year or 8.0% of the
consolidated senior secured debt outstanding. For the last
twelve months ending September 30,
2015, consolidated senior secured interest expense for
ARP was approximately $43 million. In addition, the Issuers will
add a corresponding event of default to the 7.75% Notes Indenture
providing that failure to comply with such additional covenant will
constitute an immediate event of default. The text of this
amendment to the 7.75% Notes Indenture is set forth below:
The 7.75% Notes Indenture is to be amended to include Section
4.19 as follows:
"Section 4.19 Interest Expense.
ARP will not, as of the last
day of any fiscal year for which audited financial statements have
been provided pursuant to Section 4.18, permit Consolidated Senior
Secured Interest Expense to exceed the Maximum Consolidated Senior
Secured Interest Expense Amount.
In the event that the Issuer fails to comply with the
immediately preceding sentence, the Issuers shall have the right to
reduce the Consolidated Senior Secured Interest Expense, solely for
purposes of determining compliance with this covenant, as of any
fiscal year for such fiscal year, by the aggregate amount of the
net cash proceeds actually received by ARP in a sale or issuance of, or contributions
in respect of Equity Interests of ARP (any such equity contribution, a
"Specified Equity Contribution") on or prior to the day that is
thirty (30) days after the day on which audited financial
statements are required to be delivered pursuant to Section 4.18
with respect to such fiscal year (the "Cure Expiration Date");
provided that the aggregate amount of all proceeds of
Specified Equity Contributions applied pursuant to this paragraph
during the term of this Indenture shall not exceed $8,000,000. For purposes of clarification,
the $8,000,000 is an aggregate cap
for the entire term of the Indenture that shall be reduced by the
net cash proceeds actually received from each Specified Equity
Contribution and applied pursuant to this paragraph.
Notwithstanding the provisions of Article 6, neither the Trustee
nor any Holder may exercise any remedies specified in this
Indenture arising solely from an Event of Default resulting from a
breach of this Section 4.l9 with respect to any fiscal year for a
period commencing upon the date any Issuer sends an irrevocable
written notice to the Trustee (which notice must be sent
within ten (10) days after the date on which audited financial
statements are required to be delivered pursuant to Section 4.18)
that it intends to cure non-compliance with the financial covenant
included herein for such fiscal year by a Specified Equity
Contribution permitted herein through the Cure Expiration Date with
respect to such fiscal year. Upon the timely receipt of the
Special Equity Contribution in accordance with this provision, the
proceeds from such Special Equity Contribution to be applied
pursuant to this provision shall be deemed, solely for purposes of
determining compliance with this covenant, to have been received in
the immediately preceding fiscal year for which the Consolidated
Senior Secured Interest Expense is being measured for purposes of
this covenant."
In addition, the following clause (xi) will be added to Section
6.01:
"(xi) Failure by ARP to comply with its obligations under
Section 4.19."
Further, the following definitions will be added to Section 1.01
of the 7.75% Indenture:
"Adjustment Amount" means, as of any date of determination, an
amount equal to (A) if the LIBO Rate is less than or equal to 200
basis points, $0 or (B) if the LIBO
Rate is greater than 200 basis points, (1) the result of the
difference between (a) the LIBO Rate as of such determination date
and (b) 200 basis points divided by 100 multiplied by (2) the
amount of Consolidated Senior Secured Debt outstanding as of such
date of determination.
"Consolidated Senior Secured Interest Expense" means
Consolidated Interest Expense with respect to Consolidated Senior
Secured Debt.
"Consolidated Senior Secured Debt" means, as at any date of
determination, the aggregate principal amount of all Indebtedness
for borrowed money of ARP or any
Restricted Subsidiary outstanding on such date that is secured by a
Lien on any asset or property of ARP or such Restricted Subsidiary and
Indebtedness of another Person that is Guaranteed by any Issuer or
any Restricted Subsidiary and secured by a Lien on assets of any
Issuer or any Restricted Subsidiary.
"Cure Expiration Date" has the meaning in Section 4.19.
"LIBO Rate" means, as of any date of determination, (a) the
3-month London Interbank Offered Rate as published in the Eastern
Edition of the Wall Street Journal for deposits in the applicable
currency as published on such day, or (b) if such rate is not
available at such time for any reason, then the "LIBO Rate" for
such interest period shall be such other regularly published
average 3-month London Interbank Offered Rate applicable to
major commercial banks in London
reasonably determined by the administrative agent under the
Issuer's first lien Credit Facility in good faith. For any
day that is not a Business Day, the LIBO Rate for such day shall be
the rate published on the immediately preceding Business Day.
"Maximum Consolidated Senior Secured Interest Expense Amount"
means, as of any date of determination, the sum of (A) the
greater of (1) $80,000,0000 and (2)
an amount equal to 8.0% of the Consolidated Senior Secured Debt
outstanding as of such date, plus (B) the Adjustment Amount.
"Specified Equity Contribution" has the meaning set forth in
Section 4.19.
(3) Add a prohibition with respect to certain make-whole
payments. The text of this amendment will be added as Section
4.09(h) to the 7.75% Notes Indenture as set forth below:
"(h) Any Indebtedness of
ARP or any of the Restricted
Subsidiaries Incurred after December 1,
2015, that contains a provision for a make-whole payment,
yield maintenance payment, redemption or repayment premium, or any
other premium, fee, or penalty that is payable upon the repayment,
maturity or redemption of such Indebtedness (collective, a "Make
Whole Premium") shall explicitly provide that such Make Whole
Premium shall not be payable after and during the continuance of an
event of default, upon the automatic or other acceleration of such
Indebtedness prior to its stated maturity date, or after the
commencement of a case with respect to the issuer of such
Indebtedness under Bankruptcy Law."
Expiration Date
ARP previously announced that
the Issuers extended the 7.75% Notes Consent Solicitation, which
now expires at 5:00 p.m.,
New York City time, Tuesday, December 29, 2015, unless further
extended. Except as modified as described in this press release,
the terms and conditions of the 7.75% Notes Consent Solicitation
remain unchanged, and holders of the 7.75% Notes should refer to
the Issuers' Consent Solicitation Statement, dated December 10, 2015 (the "Consent Solicitation
Statement") for more information regarding the 7.75% Notes Consent
Solicitation. Currently, $375,000,000
in aggregate principal amount of the 7.75% Notes is
outstanding.
9.25% Notes Consent Fee
The Company has previously announced the completion of the
consent solicitation (the "9.25% Notes Consent Solicitation") for
the Issuers' 9.25% Senior Notes due 2021 (the "9.25% Notes"), which
expired at 5:00 p.m., New York City time, on December 17, 2015 and for which the Issuers
received consents from holders of a majority of the outstanding
aggregate principal amount of the 9.25% Notes to the amendments
contemplated by the 9.25% Notes Consent Solicitation. However,
certain holders of the 7.75% Notes who have indicated their support
for the 7.75% Notes Consent Solicitation with the amended terms set
forth above did not consent to the 9.25% Notes Consent
Solicitation. With the additional significant holders
supporting the 7.75% Notes Consent Solicitation with the amended
terms set forth above, ARP now
anticipates it has the support of over 97% of the holders of the
9.25% Notes for the 9.25% Notes Consent Solicitation.
Accordingly, the Issuers have decided to pay the consent fee for
the 9.25% Notes Consent Solicitation to all holders of the 9.25%
Notes as of the Record Date to recognize the support of the
Issuers' noteholders.
Solicitation Agent, Information Agent and Tabulation
Agent
This announcement is not an offer to purchase, a solicitation of
an offer to purchase, or a solicitation of consents with respect to
any securities. The consent solicitation is being made solely by
the Issuers' Consent Solicitation Statement and is subject to the
terms and conditions stated therein.
Cautionary Note Regarding Forward-Looking Statements
Certain matters discussed within this press release are
forward-looking statements. Although ARP believes the expectations reflected in
such forward-looking statements are based on reasonable
assumptions, it can give no assurance that its expectations will be
attained. Forward-looking statements speak only as of the date
hereof, and ARP assumes no
obligation to update such statements, except as may be required by
applicable law.
Atlas Resource Partners, L.P. (NYSE: ARP) is an exploration & production
master limited partnership which owns an interest in over 14,500
producing natural gas and oil wells, located primarily in
Appalachia, the Barnett Shale (TX), the Mississippi Lime (OK), the
Eagle Ford Shale (TX), the Raton Basin (NM), Black Warrior Basin
(AL) and the Rangely Field (CO). ARP is also the largest sponsor of natural gas
and oil investment partnerships in the U.S. For more information,
please visit our website at www.atlasresourcepartners.com
(http://www.atlasresourcepartners.com), or contact Investor
Relations at InvestorRelations@atlasenergy.com
(mailto:InvestorRelations@atlasenergy.com).
Atlas Energy Group, LLC (NYSE: ATLS) is a limited
liability company which owns the following interests: all of the
general partner interest, incentive distribution rights and an
approximate 23% limited partner interest in its upstream oil &
gas subsidiary, Atlas Resource Partners, L.P.; the general partner
interests, incentive distribution rights and limited partner
interests in Atlas Growth Partners, L.P.; and a general partner
interest in Lightfoot Capital Partners, an entity that invests
directly in energy-related businesses and assets. For more
information, please visit our website at www.atlasenergy.com
(http://www.atlasenergy.com), or contact Investor Relations at
InvestorRelations@atlasenergy.com
(mailto:InvestorRelations@atlasenergy.com).
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/atlas-resource-partners-lp-announces-amendment-to-consent-solicitation-for-775-senior-notes-300197227.html
SOURCE Atlas Resource Partners, L.P.