Item 1.01 Entry into a Material Definitive Agreement.
On October 8, 2025, California Resources Corporation (the “Company”) completed its previously announced private offering of $400.0 million aggregate principal amount of its 7.000% senior notes due 2034 (the “Notes”). The terms of the Notes are governed by the Indenture (the “Indenture”), dated as of October 8, 2025, by and among the Company, the guarantors party thereto (the “Guarantors”) and Wilmington Trust, National Association, as trustee (the “Trustee”). The Notes will mature on January 15, 2034. Interest will accrue from October 8, 2025 and will be payable semi-annually on January 15 and July 15 of each year, commencing July 15, 2026.
The Notes are guaranteed on a senior unsecured basis by all of the Company’s existing subsidiaries that guarantee its obligations under its revolving credit facility, its existing 7.125% Senior Notes due 2026 and its existing 8.250% Senior Notes due 2029, and the Notes will be guaranteed by certain of the Company’s future subsidiaries. Following the consummation of the Company’s pending business combination (the “Berry Merger”) with Berry Corporation (bry) (“Berry”), the Notes will be guaranteed by all of the entities that become guarantors under the revolving credit facility, the existing 7.125% Senior Notes due 2026 and the existing 8.250% Senior Notes due 2029 in connection of the consummation of the Berry Merger. The Notes and the guarantees thereof are unsecured, rank equally in right of payment with all senior unsecured debt of the Company and the Guarantors and rank senior to all of the existing and future subordinated debt of the Company and the Guarantors.
The Notes are subject to a special mandatory redemption at a redemption price equal to 100% of the initial issue price of the Notes plus accrued and unpaid interest to, but excluding, the payment date of such mandatory redemption, if (x) the Berry Merger does not occur on or before March 14, 2026 (subject to up to two three-month extensions by either the Company or Berry upon written notice in certain circumstances) (the “Outside Date”), or (y) prior thereto, the Company notifies the Trustee in writing that (i) the merger agreement related to the Berry Merger (the “Merger Agreement”) has been terminated or (ii) the Company will not pursue the consummation of the Berry Merger or has determined in its sole discretion that the Berry Merger cannot or is not reasonably likely to be consummated by the Outside Date.
The Company may, at its option, redeem some or all of the Notes at any time on or after January 15, 2029 at the redemption prices specified in the Indenture. Prior to such time, the Company may, at its option, redeem up to 40% of the aggregate principal amount of the Notes with an amount of cash not greater than the net cash proceeds from certain equity offerings at the redemption price specified in the Indenture. In addition, before January 15, 2029, the Company may redeem some or all of the Notes at a redemption price equal to 100% of the aggregate principal amount of the Notes redeemed, plus the applicable premium as specified in the Indenture and accrued and unpaid interest, if any, to, but excluding, the redemption date. If the Company experiences certain kinds of change of control trigger events, the Company will be required to offer to repurchase the Notes at 101% of the aggregate principal amount of the Notes repurchased, plus accrued and unpaid interest, if any, on the Notes repurchased to, but excluding, the date of purchase. The Indenture contains other customary terms, events of default and covenants.
The above description of the Indenture is not complete and is qualified in its entirety by reference to the full text of the Indenture, which is filed as Exhibit 4.1 hereto and incorporated by reference herein.
| Item 2.03 |
Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement. |
The information provided under Item 1.01 in this Current Report on Form 8-K regarding the Notes, the Indenture and the related guarantees is incorporated by reference into this Item 2.03.
Additional Information and Where to Find It
In connection with the Berry Merger, the Company will file with the Securities and Exchange Commission (the “SEC”) a registration statement on Form S-4 that will be filed by the Company (the “Registration Statement”), which will include a proxy statement of Berry that also constitutes a prospectus of the Company, and any other documents in connection with the Berry Merger. The definitive proxy statement/prospectus will be sent to the holders of common stock of Berry. Investors and stockholders of the Company and Berry are urged to read the proxy statement/prospectus and any other documents filed or to be filed with the SEC in connection with the Berry Merger when they become available, as they will contain important information about the Company, Berry, the Berry Merger and related matters. The Registration Statement and proxy statement/prospectus and other documents filed by the Company or Berry with the SEC, when filed, will be available free of charge at the SEC’s website at https://www.sec.gov. Alternatively, investors and stockholders may obtain free copies of documents that are filed or will be filed with the SEC by the Company, including the Registration Statement and the proxy statement/prospectus, on the Company’s website at https://www.crc.com/investor-relations, and may obtain free copies of documents that are filed or will be filed with the SEC by Berry, including the proxy statement/prospectus, on Berry’s website at https://ir.bry.com/reports-resources. The information included on, or accessible through, the Company’s or Berry’s website is not incorporated by reference into this communication.
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