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CUSIP No. 345143200
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SCHEDULE 13D
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Page 6 of 9 Pages
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This Amendment (this “Amendment”) amends that certain statement on Schedule 13D filed by the Reporting Persons on December 30, 2019 (the “Original Schedule 13D” and, together with this Amendment, the “Schedule 13D”). Except as specifically
provided herein, this Amendment does not modify any of the information previously reported in the Schedule 13D. Capitalized terms used but not defined herein have the meaning ascribed to them in the Original Schedule 13D.
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Item 3.
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Source and Amount of Funds or Other Consideration
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Item 3 of the Schedule 13D is hereby amended and supplemented by adding the following paragraph immediately following the first paragraph:
On March 4, 2019, the Reporting Persons acquired an aggregate principal amount of $10.8 million of PIK Notes pursuant to the backstop commitment letter, dated November 16, 2018, filed as exhibit 10.4 to the Issuer’s Current Report on Form
8-K filed with the SEC on November 23, 2018. On March 4, 2019, the Reporting Persons acquired an additional aggregate principal amount of $9.5 million of PIK Notes pursuant to their exercise of subscription rights in the Issuer’s rights
offering, as described in the Issuer’s prospectus dated February 13, 2019. As described in Item 4 below, the Reporting Persons acquired 709,253 shares of Common Stock upon an exchange of an aggregate principal amount of $93,418 of PIK Notes
pursuant to the Exchange and Contribution Agreement. The source of funds for the PIK Note acquisitions was the working capital of Special Situations.
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Item 4.
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Purpose of the Transaction
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Item 4 of the Schedule 13D is hereby amended and supplemented by adding the following paragraphs immediately following the third paragraph:
On April 16, 2020, the Reporting Persons acquired 709,253 shares of Common Stock upon an exchange of an aggregate principal amount of $93,418 of PIK Notes pursuant to the Exchange and Contribution Agreement.
Brett Wyard, a managing partner of each of the general partner of Solace Capital and of Solace GP, serves on the Issuer's board of directors as a representative of Solace Capital.
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Item 5.
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Interest in Securities of the Issuer
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Items 5(a), (b) and (c) of the Schedule 13D are hereby amended and restated as follows:
(a)
The aggregate number of shares of Common Stock beneficially owned by the Reporting Persons as of the date hereof is 1,656,521. These shares of Common Stock are owned directly by Solace Forbes. There were 5,522,822 shares of Common Stock
outstanding as of March 16, 2020, as per the Issuer’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019. There were 171,716 unvested shares under the Issuer’s management incentive plan (“Management Incentive Plan”) as of
December 31, 2019, as per the Issuer’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019. On January 18, 2020, the Issuer issued an additional 292,160 unvested shares pursuant to the Management Incentive Plan. All
unvested shares under the Management Incentive Plan will vest upon consummation of the Merger. On April 16, 2020, the Issuer issued 1,672,369 shares of Common Stock pursuant to the Exchange and Contribution Agreement. The calculation of
beneficial ownership of outstanding shares of Common Stock in this Item 5 and elsewhere in this Schedule 13D assumes there are 7,659,067 shares outstanding as of the date of this Schedule 13D.
(b)
Each of the Reporting Persons beneficially owns, and has the shared power to vote or direct the vote of, and the shared power to dispose or direct the disposition of, 1,656,521 shares of Common Stock, representing 21.6% of the outstanding shares of Common Stock.
(c)
The response to Item 4 of the Schedule 13D is incorporated by reference. Except as disclosed herein, none of the Reporting Persons have effected any transactions in Common Stock during the past 60
days.
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CUSIP No. 345143200
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SCHEDULE 13D
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Page 7 of 9 Pages
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Item 6.
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Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer
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Item 6 of the Schedule 13D is hereby amended and supplemented by deleting the fifth paragraph and adding the following paragraphs immediately following the fourth paragraph:
On March 20, 2020, the Issuer as a guarantor, the Borrower, and certain of their subsidiaries, as guarantors, entered into Amendment No. 3 to Loan and Security Agreement with the lenders party thereto and the term loan agent, which
provided, among other things, that a default under the Revolving Loan Agreement, dated November 16, 2018, by and among the Issuer and certain of its subsidiaries, as borrowers, the lenders party thereto and Regions Bank, as administrative
agent and collateral agent (the “Revolving Loan Agreement”), due to the expiration of a waiver under the Revolving Loan Agreement in respect of the Issuer’s audit opinion would not constitute a default under the Loan and Security Agreement
(“Amendment No. 3 to Term Loan Agreement”).
The foregoing descriptions of the Indenture, the Term Loan Agreement, Amendment No. 3 to Term Loan Agreement and the Registration Rights Agreement do not purport to be complete and are qualified in their entirety by reference to the
Indenture, Term Loan Agreement, Amendment No. 3 to Term Loan Agreement and Registration Rights Agreement, respectively, complete copies of which are attached as Exhibit 4.1 to the Issuer’s Current Report on Form 8-K filed with the Securities
and Exchange Commission (“SEC”) on March 4, 2018, Exhibit 10.1 to the Issuer’s Current Report on Form 8-K filed with the SEC on April 18, 2017, Exhibit 10.3 to the Issuer’s Current Report on Form 8-K filed with the SEC on November 23,
2018, Exhibit 10.18 to the Issuer’s Annual Report on Form 10-K filed with the SEC on March 23, 2020, Exhibit 10.22 to the Issuer’s Annual Report on Form 10-K filed with the SEC on March 23, 2020 and Exhibit 10.1 to the Issuer’s Registration
Statement on Form 8-A filed with the SEC on April 18, 2017, respectively, and are each incorporated into this Item 6 by reference.
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CUSIP No. 345143200
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SCHEDULE 13D
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Page 8 of 9 Pages
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Item 7.
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Materials to be Filed as Exhibits
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The fifth row of the exhibit table contained in Item 7 of the Schedule 13D is hereby amended and restated as follows:
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7.4
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Loan and Security Agreement, dated as of April 13, 2017, by and among Forbes Energy Services Ltd., Forbes Energy Services LLC, Forbes Energy International, LLC, TX Energy Services, LLC, C.C. Forbes, LLC, Cretic Energy Services,
LLC, Wilmington Trust, National Association and the lenders from time to time thereto (incorporated by reference to Exhibit 10.1 to the Issuer’s Current Report on Form 8-K filed with the SEC on April 18, 2017).
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The exhibit table contained in Item 7 of the Schedule 13D is hereby amended and supplemented by adding the following exhibits:
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7.6
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First Amendment to Loan and Security Agreement, dated as of November 16, 2018 (incorporated by reference to Exhibit 10.3 to the Issuer’s Current Report on Form 8-K filed November 23, 2018).
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7.7
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Amendment No. 2 to Loan and Security Agreement, dated as of May 28, 2019 (incorporated by reference to Exhibit 10.18 to the Issuer’s Annual Report on Form 10-K filed with the SEC on March 23, 2020).
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7.8
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Amendment No. 3 to Loan and Security Agreement, dated as of March 23, 2020 (incorporated by reference to Exhibit 10.22 to the Issuer’s Annual Report on Form 10-K filed with the SEC on March 23, 2020).
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