Item 1.01. Entry into a Material Definitive Agreement.
OnAugust 6, 2021 ,Viper Energy Partners LP ("Viper") and its subsidiaryViper Energy Partners LLC ("Viper OpCo") entered into a definitive purchase and sale agreement (the "Purchase and Sale Agreement") withSwallowtail Royalties LLC andSwallowtail Royalties II LLC (collectively, the "Swallowtail Entities" or the "Seller"), providing for an acquisition by Viper and Viper OpCo of certain mineral and royalty interests from the Seller in exchange for 15.25 million common units representing limited partnership interests in Viper (the "Common Unit Consideration") and$225 million in cash (the "Cash Consideration"), subject to customary purchase price adjustments (the "Pending Acquisition"). The Purchase and Sale Agreement provides that at closing of the Pending Acquisition ("Closing"), a portion of the assets to be acquired by Viper for the Common Unit Consideration will be immediately contributed by Viper to Viper OpCo in exchange for an equivalent number of units representing limited liability company interests in Viper OpCo. The Pending Acquisition will have an effective date ofAugust 1, 2021 and is expected to close by early fourth quarter of 2021, subject to the completion of due diligence and the satisfaction of customary closing conditions, including the expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended. The Cash Consideration is expected to be funded through a combination of cash on hand and borrowings under Viper OpCo's revolving credit facility. The assets being acquired in the Pending Acquisition represent 2,302 net royalty acres primarily in theNorthern Midland Basin , approximately 65% of which are operated by Viper's parentDiamondback Energy, Inc. ("Diamondback"). The Swallowtail Entities are controlled by The Blackstone Group Inc. ("Blackstone"), which beneficially owns approximately 5.9% of Diamondback's outstanding common stock. Diamondback acquired approximately 32,500 net acres in theNorthern Midland Basin and certain related oil and gas assets fromGuidon Operating LLC ("Guidon") and certain otherBlackstone affiliates in exchange for 10.68 million shares of Diamondback's common stock and$375 million in cash inFebruary 2021 . Assuming no adjustments to the Common Unit Consideration, at Closing, the Seller would receive 15.25 million common units representing the Common Unit Consideration (the "Common Units"), which will be issued in reliance upon the exemption from the registration requirements of the Securities Act of 1933, as amended (the "Securities Act"), provided by Section 4(a)(2) of the Securities Act as sales by an issuer not involving any public offering. As a condition to Closing, Viper will be obligated to enter into a registration rights agreement with the Seller, pursuant to which the Seller will receive certain demand and piggyback registration rights with respect to the Common Units and Viper will file with theSecurities and Exchange Commission , within 15 days following Closing, a shelf registration statement registering for resale the Common Units, cause such shelf registration statement to be declared effective promptly thereafter and cause the Common Units to be listed on the Nasdaq Global Select Market. Viper will bear all registration, offering and listing expenses relating to the Common Units and the exercise by the Seller of such registration rights, except that the Seller will be obligated to pay all underwriting fees, discounts and commissions, placement fees of the underwriters, broker commissions and any transfer taxes and certain fees and expenses of counsel for the Seller.
The Purchase and Sale Agreement contains customary representation and warranties, covenants and indemnification provisions of the parties.
The preceding summary of the Purchase and Sale Agreement is qualified in its entirety by reference to the full text of the Purchase and Sale Agreement, a copy of which is attached as Exhibit 2.1 to this Current Report on Form 8-K and is incorporated herein by reference.
Item 3.02. Unregistered Sales of
The information set forth in Item 1.01 above with respect to the Common Unit Consideration is incorporated herein by reference.
Item 7.01. Regulation FD Disclosure.
On
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Item 9.01. Financial Statements and Exhibits.
(d) Exhibits Number Description 2.1*# Purchase and Sale Agreement datedAugust 6, 2021 , by
and among Swallowtail
Royalties LLC ,Swallowtail Royalties II LLC
(collectively, as seller),
Partners LLC (as buyer) andViper Energy Partners LP
(as parent, and collectively
with Viper Energy Partners LLC, as buyer parties). 99.1** Press release dated August 9 , 2021, entitled
"
LP, a subsidiary ofDiamondback Energy, Inc. , Announces
Acquisition ." 104 Cover Page Interactive Data File - the cover page XBRL
tags are embedded within the
Inline XBRL document. * Filed herewith. ** Furnished herewith. # Schedules (or similar attachments) have been omitted pursuant to Item 601(a)(5) of
Regulation S-K and will be provided to the
request.
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