Attached files
| file | filename |
|---|---|
| EX-4.1 - Energy XXI Ltd | v166845_ex4-1.htm |
| EX-4.2 - Energy XXI Ltd | v166845_ex4-2.htm |
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): November 19, 2009
Energy
XXI (Bermuda) Limited
(Exact
name of registrant as specified in its charter)
|
BERMUDA
|
001-33628
|
98-0499286
|
||
|
(State
or other jurisdiction of
incorporation)
|
(Commission
File Number)
|
(IRS
Employer Identification
No.)
|
Canon’s
Court, 22 Victoria Street, P.O. Box HM
1179,
Hamilton HM EX, Bermuda
(Address
of principal executive offices) (Zip Code)
Registrant’s
telephone number, including area code (441) 295-2244
(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:
o Written communications
pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material
pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
o Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17
CFR 240.14d-2(b))
o Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17
CFR 240.13e-4(c))
Item
1.01. Entry into a
Material Definitive Agreement.
On
November 13, 2009, Energy XXI Gulf Coast, Inc. (“EXXI Gulf Coast”), an indirect
and wholly-owned subsidiary of Energy XXI (Bermuda) Limited (the “Company”)
completed an exchange offer and consent solicitation (the “Exchange Offer”) in
respect of its 10% Senior Notes due 2013 (the “Senior Notes”) pursuant to which
EXXI Gulf Coast accepted for exchange $347,500,000 principal amount of
outstanding Senior Notes properly tendered and not validly withdrawn for an
aggregate principal amount of $278,000,000 of EXXI Gulf Coast’s newly issued 16%
Second Lien Junior Secured Notes due 2014 (the "Second Lien
Notes"). The Second Lien Notes issued in the Exchange Offer were
exempt from registration under Section 4(2) of the Securities Act of 1933, as
amended (the “Securities Act”) and Regulation D thereunder.
In
conjunction with the Exchange Offer, EXXI Gulf Coast also received the consents
from holders of the required principal amount of the Senior Notes to certain
proposed amendments to the indenture under which the Senior Notes were issued,
which modified certain of the restrictive covenants in that indenture in order
to permit the issuance of the Second Lien Notes.
In
connection with the Exchange Offer, EXXI Gulf Coast, the Company, Energy XXI
USA, Inc. (the “Direct Parent”) and certain subsidiary guarantors entered into a
purchase agreement, which has previously been filed by the Company in a Current
Report on Form 8-K, with a limited number of qualified institutional buyers (as
defined in Rule 144A under the Securities Act) and institutional accredited
investors (the “Initial Purchasers”) for the sale of an aggregate $60,000,000
principal amount of Second Lien Notes and 13,224,720 shares of the Company’s
common stock, par value $0.001, (the “Concurrent Private
Placement”). The Second Lien Notes issued in the Concurrent Private
Placement were exempt from registration under Section 4(2) of the Securities Act
and Regulation D thereunder.
After
giving effect to the Exchange Offer and the Concurrent Private Placement, EXXI
Gulf Coast has $276,500,000 of Senior Notes and $338,000,000 of Second Lien
Notes outstanding.
Indenture.
On
November 13, 2009, in connection with the issuance of $338,000,000 aggregate
principal amount of Second Lien Notes in the Exchange Offer and Concurrent
Private Placement, EXXI Gulf Coast, the Company, the Direct Parent and certain
subsidiaries entered into an Indenture dated as of November 12, 2009 governing
the Second Lien Notes with Wells Wilmington Trust, FSB, as trustee (the
“Indenture”).
The
Second Lien Notes are general secured obligations and bear interest at the rate
of 16% per annum, consisting of (i) 14% payable in cash and (ii) 2% payable by
either increasing the outstanding principal amount of the applicable series or
by issuing additional Second Lien Notes of the applicable series (the “PIK
Interest”), in each case payable on June 15 and December 15 of each year,
beginning on December 15, 2009. The Second Lien Notes will mature on
June 15, 2009.
The
obligations under the Second Lien Notes are guaranteed by the following: (i) a
guarantee by the Direct Parent, with recourse limited to its ownership of 100%
of EXXI Gulf Coast’s outstanding capital stock; (ii) the full and
unconditional guarantee of the Company; and (iii) the full and unconditional
guarantee of each of EXXI Gulf Coast’s subsidiaries (the “Subsidiaries,” and
together with the Direct Parent and the Company, the “Guarantors” and the
guarantees of Second Lien Notes by the Guarantors, collectively, the
“Guarantees”). If any party becomes a new guarantor under EXXI Gulf
Coast’s Amended and Restated First Lien Credit Agreement dated as of June 8,
2007 among EXXI Gulf Coast, as borrower, the various lenders named therein, and
The Royal Bank of Scotland plc, as administrative agent, as amended, restated,
modified or refinanced from time to time (the “Credit Agreement”) or the Senior
Notes, such party will also become a guarantor of the Second Lien
Notes.
Both the
Second Lien Notes and the Guarantees (other than that of the Company) for the
Second Lien Notes are secured by a second priority lien subject to permitted
prior liens on the same collateral that secures EXXI Gulf Coast’s obligations
under the Credit Agreement. Such collateral generally consists of the
following property (collectively, the “Collateral”): (i) substantially all of
the assets of EXXI Gulf Coast and the Subsidiaries, (ii) the Direct Parent’s
pledge of 100% of EXXI Gulf Coast’s issued and outstanding capital stock, (iii)
any assets substituted for such Collateral and (iv) and proceeds of the
foregoing.
The
Second Lien Notes and Guarantees of the Second Lien Notes rank: (i) subordinated
in right of payment to indebtedness under the Credit Agreement, including
refinancings of such indebtedness; (ii) pari passu in right of
payment with all of EXXI Gulf Coast’s existing and future indebtedness that is
not subordinated, including the Senior Notes; and (iii) senior in right of
payment to any subordinated indebtedness. The Second Lien Notes also
are subordinated in priority to indebtedness under the Credit Agreement to the
extent of the collateral.
EXXI Gulf
Coast may, at its option, redeem:
(i) some
or all of the Second Lien Notes at any time or from time to time prior to June
15, 2011, at a price equal to 100% of the principal amount of the Second Lien
Notes plus a premium equal to the greater of (x) 1.0% of the principal amount of
such note and (y) the excess of (A) the present value at such time of (1)
redemption price of such note as of June 15, 2011 (without regard to accrued and
unpaid interest) plus (2) all required interest payments due on such note
through June 15, 2011, computed using a discount rate equal to the treasury rate
plus 50 basis points, over (B) the principal amount of such note, plus accrued
and unpaid interest, if any;
(ii) up
to 35% of the Second Lien Notes at any time or from time to time prior to June
15, 2011, using the proceeds of certain equity offerings at a redemption price
of 110% of the principal amount thereof, plus accrued and unpaid interest, if
any;
(iii)
some or all of the Second Lien Notes at any time or from time to time on or
after June 15, 2011 and prior to June 15, 2012 at a price equal to 106.5% of the
principal amount of the Second Lien Notes, plus any accrued and unpaid interest,
if any;
(iv) some
or all of the Second Lien Notes at any time or from time to time on or after
June 15, 2012 and prior to June 15, 2013 at a price equal to 103.25% of the
principal amount of the Second Lien Notes, plus any accrued and unpaid interest,
if any; and
(v) some
or all of the Second Lien Notes at any time or from time to time on or after
June 15, 2013 at a price equal to 100% of the principal amount of the Second
Lien Notes, plus any accrued and unpaid interest, if any.
EXXI Gulf
Coast must offer to purchase the Second Lien Notes at a price equal to 101% of
the principal amount of the Second Lien Notes upon certain kinds of changes of
control and at a price equal to par plus accrued and unpaid interest, if any,
upon sales of certain assets.
The
Indenture restricts the ability of EXXI Gulf Coast and the ability of the
Subsidiaries to: (i) incur or assume additional debt or provide guarantees in
respect of obligations of other persons; (ii) issue redeemable stock and
preferred stock, (iii) pay dividends or distributions or redeem or repurchase
capital stock; (iii) prepay, redeem or repurchase debt; (iv) make loans and
investments; (v) incur certain liens; (vi) impose limitations on dividends,
loans or asset transfers from our subsidiaries; (vii) sell or otherwise dispose
of assets, including capital stock of subsidiaries; (viii) consolidate or merge
with or into, or sell substantially all of our assets to, another person; (ix)
enter into transactions with affiliates; and (x) impair the security interest in
the Collateral.
The
Indenture specifies a number of events of default (some of which are subject to
applicable cure periods), including among others, the failure to make payments
when due, noncompliance with covenants, defaults under other agreements or
instruments of indebtedness and the occurrence of certain bankruptcy
proceedings. In the case of an event of default arising from certain
events of bankruptcy or certain failures relating to the security interests or
the Guarantees, all of the outstanding Second Lien Notes will become due and
payable immediately without further action or notice. If any other
event of default occurs and is continuing, the trustee or the holders of at
least 25% in principal amount of the then outstanding Second Lien Notes may
declare all the Second Lien Notes to be due and payable
immediately.
Registration Rights
Agreement.
On
November 13, 2009, EXXI Gulf Coast, the Company, the Direct Parent and certain
subsidiary guarantors entered into a Registration Rights Agreement dated as of
November 12, 2009 (the “Registration Rights Agreement”) with the Initial
Purchasers providing the holders of the Second Lien Notes certain rights
relating to registration of the Second Lien Notes under the Securities
Act. Within 180 days of issuing the Second Lien Notes EXXI Gulf Coast
is required to file a registration statement (and use all reasonable efforts to
keep effective) with the Securities and Exchange Commission (the “SEC”) in order
to register exchange notes (and related guarantees) having substantially
identical terms as the Second Lien Notes (and related guarantees) under the
Securities Act. If a registration statement is not filed by such a
date (“Registration Default”), EXXI Gulf Coast will be required to pay cash
interest at a 50 basis point premium over and above the stated 14% cash interest
on the Second Lien Notes (the “Penalty Interest”) plus the stated PIK Interest
on the Second Lien Notes, until such Registration Default is
cured. The Penalty Interest will increase by an additional 50 basis
point premium for each 60-day period which passes until all Registration
Defaults are cured; provided
that the Penalty Interest will not exceed a 150 basis points
premium.
The
foregoing summary is qualified in its entirety by reference to the Indenture and
the Registration Rights Agreement, attached hereto as Exhibits 4.1 and 4.2,
respectively.
Item
2.03. Creation of a
Direct Financial Obligation or an Obligation under an Off-Balance Sheet
Arrangement of a Registrant.
The
information set forth in Item 1.01 is incorporated herein by
reference.
Item
9.01. Financial
Statements and Exhibits.
(d)
Exhibits
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Exhibit
4.1
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Indenture,
dated as of November 12, 2009, among Energy XXI Gulf Coast, Inc., Energy
XXI (Bermuda) Limited, Energy XXI USA, Inc., Energy XXI GOM, LLC, Energy
XXI Texas Onshore, LLC, Energy XXI Onshore, LLC and Wilmington Trust FSB,
as trustee.
|
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Exhibit
4.2
|
Registration
Rights Agreement, dated November 12, 2009, among Energy XXI Gulf Coast,
Inc., Energy XXI (Bermuda) Limited, Energy XXI USA, Inc., Energy XXI GOM,
LLC, Energy XXI Texas Onshore, LLC, Energy XXI Onshore, LLC and the
purchasers listed on the signature pages
thereto.
|
SIGNATURES
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.
| Energy XXI (Bermuda) Limited | |||
|
|
By:
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/s/ David West Griffin | |
| Name: | David West Griffin | ||
| Title: | Chief Financial Officer | ||
November
19, 2009