Chord Energy Corporation filed SEC Form 8-K: Entry into a Material Definitive Agreement, Creation of a Direct Financial Obligation
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| Item 1.01 | Entry into a Material Definitive Agreement. |
Indenture for 6.000% Senior Notes due 2030
On September 30, 2025, Chord Energy Corporation (the “Company”) completed its previously announced offering of $750 million in aggregate principal amount of its 6.000% senior unsecured notes due 2030 (the “Notes”), which are fully and unconditionally guaranteed on a senior unsecured basis by certain of the Company’s subsidiaries (collectively, the “Guarantors”). The terms of the Notes are governed by the indenture dated as of September 30, 2025 (the “Indenture”), among the Company, the Guarantors and U.S. Bank Trust Company, National Association, as trustee (the “Trustee”). The Notes will mature on October 1, 2030, and interest is payable on the Notes on each April 1 and October 1, commencing on April 1, 2026.
The net proceeds of the Notes are intended to be used (i) to acquire assets in the Williston Basin from XTO Energy, Inc. and certain of its affiliates (the “XTO Acquisition”) and to pay related costs and expenses, (ii) to pay fees and expenses associated with the Notes offering, and (iii) for general corporate purposes, including repayment of borrowings under the Company’s senior secured revolving credit facility.
The Notes are subject to a special mandatory redemption such that: if (i) the consummation of the XTO Acquisition does not occur on or before June 30, 2026, which date may be extended by the Company at its option by written notice to the Trustee to not later than September 30, 2026 (such date, as it may be extended, the “Outside Date”) or (ii) prior thereto, the Company notifies the trustee in writing that the Company will not pursue the consummation of the XTO Acquisition (the earlier of the date of delivery of such notice described in clause (ii) and the Outside Date, the “Special Mandatory Redemption Trigger Date”), the Company will be required to redeem the Notes then outstanding at a redemption price equal to (a) if the Special Mandatory Redemption Trigger Date occurs on or before June 30, 2026, 100% of the principal amount of the Notes to be redeemed, or (b) if the Special Mandatory Redemption Trigger Date occurs thereafter, 101% of the principal amount of Notes to be redeemed, in each case plus accrued and unpaid interest to, but excluding, the date upon which the Notes will be redeemed.
At any time prior to October 1, 2027, the Company may redeem up to 40% of the Notes at a redemption price of 106.000% of the principal amount, plus accrued and unpaid interest, if any, to the redemption date, in an amount not greater than the net proceeds of certain equity offerings. In addition, prior to October 1, 2027, the Company may redeem some or all of the Notes for cash at a redemption price equal to 100% of the principal amount thereof plus an applicable make-whole premium and accrued and unpaid interest, if any, to, but excluding, the redemption date. The Company must offer to repurchase the Notes if it experiences specific kinds of changes of control or sells assets under certain circumstances. On and after October 1, 2027, the Company may redeem some or all of the Notes at redemption prices (expressed as percentages of principal amount) equal to 103.000% for the twelve-month period beginning on October 1, 2027, 101.500% for the twelve-month period beginning October 1, 2028, and 100.000% beginning on October 1, 2029, plus accrued and unpaid interest, if any, to, but not including, the redemption date.
The Notes are the Company’s senior unsecured obligations, rank equally in right of payment with all of the Company’s existing and future senior debt and rank senior in right of payment to all of the Company’s future subordinated debt. The Notes are effectively subordinated to all of the Company’s existing and future secured debt to the extent of the value of the collateral securing such indebtedness.
The Indenture restricts the Company’s ability and the ability of certain of its subsidiaries to: (i) make investments; (ii) incur indebtedness or issue preferred stock; (iii) create liens; (iv) sell assets; (v) enter into agreements that restrict dividends or other payments by restricted subsidiaries; (vi) consolidate, merge or transfer all or substantially all of the assets of the Company; (vii) engage in transactions with affiliates; (viii) pay dividends or make other distributions on capital stock or prepay subordinated indebtedness; and (ix) create unrestricted subsidiaries. These covenants are subject to a number of important exceptions and qualifications. If at any time when the Notes are rated investment grade from two of three ratings agencies and no Default (as defined in the Indenture) has occurred and is continuing, many of such covenants will terminate and the Company and its subsidiaries will cease to be subject to such covenants.
The Indenture contains customary events of default, including:
| • | default for 30 days in the payment when due of interest (or Additional Amounts (as defined in the Indenture), if any) on the Notes; |
| • | default in the payment when due of the principal of, Additional Amounts or premium, if any, on the Notes; |
| • | failure by the Company to comply with its other obligations under the Indenture, in certain cases subject to notice and grace periods; |
| • | payment defaults and accelerations with respect to other indebtedness of the Company and its Restricted Subsidiaries (as defined in the Indenture) in the aggregate principal amount of $100.0 million or more; |
| • | failure by the Company or any Significant Subsidiary (as defined in the Indenture) or group of Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary to pay certain final judgments aggregating in excess of $100.0 million, which judgments are not paid, discharged or stayed for a period of 60 days; |
| • | certain events of bankruptcy, insolvency or reorganization of the Company or a Significant Subsidiary or group of Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary; and |
| • | any guarantee of the Notes by a Guarantor ceases to be in full force and effect, is declared null and void in a judicial proceeding or is denied or disaffirmed by its maker. |
The foregoing description of the Indenture is a summary only and is qualified in its entirety by reference to the complete text of the Indenture, which is filed as Exhibit 4.1 to this Form 8-K and incorporated herein by reference.
| Item 2.03 | Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. |
The information included in Item 1.01 of this Current Report on Form 8-K under the caption “Indenture for 6.000% Senior Notes due 2030” is incorporated by reference into this Item 2.03 of this Current Report on Form 8-K.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits.
| Exhibit |
Description of Exhibit | |
| 4.1 | Indenture, dated as of September 30, 2025, among the Company, the Guarantors and U.S. Bank Trust Company, National Association, as trustee. | |
| 4.2 | Form of 6.000% Note due 2030 (included in Exhibit 4.1). | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). | |
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 thereunto duly authorized.
| CHORD ENERGY CORPORATION (Registrant) | ||||||
| Date: September 30, 2025 | By: | /s/ Shannon B. Kinney | ||||
| Shannon B. Kinney | ||||||
| Executive Vice President, Chief Administration Officer, General Counsel, and Corporate Secretary | ||||||