8-K

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):  September 27, 2014

ATHLON HOLDINGS LP

ATHLON FINANCE CORP.

(Exact name of registrant as specified in its charter)

Delaware	333-195506	45-2817212
Delaware	333-195506-02	46-2465554
(State or other jurisdiction	(Commission	(IRS Employer
of incorporation)	File Number)	Identification No.)

420 Throckmorton Street, Suite 1200, Fort Worth, Texas	76102
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code:  (817) 984-8200

Not applicable

(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:

oWritten communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

oSoliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

oPre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

oPre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On September 27, 2014, in connection with Athlon Energy Inc.’s, a Delaware corporation (“Athlon”), previously announced entry into a definitive Agreement and Plan of Merger (the “Merger Agreement”) with Encana Corporation, a Canadian corporation (“Encana”), and Alenco Acquisition Company Inc., a Delaware corporation and indirect, wholly owned subsidiary of Encana (“Acquisition Sub”), pursuant to which Encana through Acquisition Sub, will commence an offer (the “Offer”) to acquire all of the outstanding shares of Athlon’s common stock, par value $0.01 per share (the “Shares”), for $58.50 per share in cash, without interest, Athlon’s majority-owned subsidiary, Athlon Holdings LP, a Delaware limited partnership (“Holdings”), entered into employment agreement amendments, to be effective immediately prior to the consummation of the Offer, with each of its named executive officers (“NEOs”), including Robert C. Reeves, its President and Chief Executive Officer, Nelson K. Treadway, its Senior Vice President—Business Development and Land, William B. D. Butler, its Vice President—Chief Financial Officer, Bud W. Holmes, its Senior Vice President—Engineering and Operations, and David B. McClelland, its Vice President—Drilling and Geosciences.  The employment agreement amendments provide for the extension of the non-competition restriction period to twelve (12) months from six (6) months following the termination of a NEO’s employment.  In addition, the employment agreement amendments provide that, if the NEO is terminated without “cause” or resigns, in each case, following a change of control, the geographic scope of the non-competition restriction is limited to a 50 mile area (25 miles for Mr. Reeves).

The foregoing summary is qualified in its entirety by reference to the full text of the employment agreement amendments,  copies of which are attached as Exhibit 10.1 and Exhibit 10.2 to this Current Report on Form 8-K and are incorporated by reference into this Item 5.02.

Item 8.01. Other Events.

On September 27, 2014, in connection with the Offer, certain of the limited partners (each, a “Partner”) of Holdings entered into a Non-Exchange Agreement with Encana, Acquisition Sub and Athlon.  Under the terms of the Non-Exchange Agreements, each Partner agreed (i) not to exchange his/her units in Holdings (“LP Units”) for Shares prior to the consummation of the Offer and (ii) subsequent to the Offer and prior to the merger, to exchange his/her LP Units for Shares.  The Non-Exchange Agreements also provide for the payment to each Partner of certain payments in lieu of payments under the Tax Receivable Agreement, which Athlon, Holdings and each Partner entered into upon consummation of Athlon’s initial public offering.  Each Partner also agreed not to exercise its early payment rights under the Tax Receivable Agreement.

Under the Non-Exchange Agreements, Encana has the right to purchase all of the LP Units held by each Partner immediately prior to the effective time of the merger for $58.50 per LP Unit.

Item 9.01. Financial Statements and Exhibits.

(d)   Exhibits.

Exhibit No.	Description
10.1	Form of Amendment to Employment Agreement, dated as of September 27, 2014, by and between Athlon Holdings LP and Robert C. Reeves.
10.2	Form of Amendment to Employment Agreement, dated as of September 27, 2014, by and between Athlon Holdings LP and each NEO (other than Robert C. Reeves).

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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 hereunto duly authorized.

Date: October 2, 2014

ATHLON HOLDINGS LP
ATHLON FINANCE CORP.
By:	/s/ John C. Souders
Name:	John C. Souders
Title:	Vice President—Controller and Principal Accounting Officer

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Exhibit No.	Description
10.1	Form of Amendment to Employment Agreement, dated as of September 27, 2014, by and between Athlon Holdings LP and Robert C. Reeves.
10.2	Form of Amendment to Employment Agreement, dated as of September 27, 2014, by and between Athlon Holdings LP and each NEO (other than Robert C. Reeves).

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EX-10.1

Exhibit 10.1

AMENDMENT TO EMPLOYMENT AGREEMENT

This AMENDMENT (this “Amendment”) to the Employment Agreement, dated as of August 7, 2013 (the “Employment Agreement”), between Athlon Holdings LP (the “Company”), and(“Executive”), is dated as of September 27, 2014, and is effective as of the Closing (as defined in the Merger Agreement).

WHEREAS, in connection with that certain Merger Agreement by and among Athlon Energy Inc. (the “Seller”), a Delaware corporation, Encana Corporation, a Canadian corporation (“Parent”), and Alenco Acquisition Company Inc., a Delaware corporation and indirect, wholly-owned subsidiary of Parent (the “Buyer”), dated on or about September 27, 2014 (the “Merger Agreement”) the Company and the Executive wish to amend the Employment Agreement as provided herein as a material inducement for Parent and the Buyer to enter into the Merger Agreement.

WHEREAS, as a result of the Merger Agreement, Executive shall be conveying goodwill in the Company and receiving significant consideration and this Amendment, which is ancillary to the Merger Agreement, furthers Parent’s, Buyer’s and their respective affiliates’ interest in protecting such goodwill.

NOW, THEREFORE, in consideration of the mutual agreements and understandings set forth herein and other good and valuable consideration, the receipt and adequacy of which hereby are acknowledged, the parties hereby agree as follows:

1.Amendment to Section 5(a) of the Employment Agreement. Effective as of immediately prior to the consummation of the Offer (as defined in the Merger Agreement) (the “Effective Time”) Section 5(a) of the Employment Agreement shall be deleted in its entirety and replaced with the following:

5(a).“Executive shall not, at any time during the Restriction Period, directly or indirectly engage in, have any equity interest in, interview for a potential employment or consulting relationship with or manage or operate any person, firm, corporation, partnership or business (whether as director, officer, employee, agent, representative, partner, security holder, consultant or otherwise) that engages in any business which competes with any portion of the Business (as defined below) of the Company in the United States; provided, however, in the event the Company terminates Executive’s employment without Cause, the Executive resigns for Good Reason or the Executive resigns for any other reason, in each case, following a Change in Control, the post-termination restrictions set forth in this Section 5(a) shall be limited to the following: (a) Executive shall not, at any time during the Restriction Period following the Date of Termination, directly or indirectly engage in, have any equity interest in, interview for a potential employment or consulting relationship with or manage or operate any person, firm, corporation, partnership or business (whether as director, officer, employee, agent, representative, partner, security holder, consultant or otherwise) that engages in any business which competes in any material respect with any

material portion of the Business (as defined below) of the Company within the twenty-five (25) mile area set forth in Exhibit A attached hereto. Nothing herein shall prohibit Executive from being a passive owner of not more than 2% of the outstanding equity interest in any entity that is publicly traded, so long as Executive has no active participation in the business of such entity.”

2.Amendment to Section 5(d) of the Employment Agreement.  Effective as of the Effective Time, the definition of “Restriction Period” in Section 5(d) of the Employment Agreement shall be amended by deleting the following phrase:

“except that if Executive’s termination of employment occurs within one year following a Change in Control, Restriction Period shall mean the period beginning on the Effective Date and ending on the date six (6) months following the Date of Termination”

3.Company Commitments; Continuing Effect of Employment Agreement; Merger Consideration.  Executive acknowledges that the Company has provided and the Company agrees, as long as Executive continues as an employee of the Company, to continue to provide Executive with access to its confidential, proprietary, and/or trade secret information of third parties such as customer, suppliers, and business affiliates; knowledge regarding the Company’s methodologies and business strategies; and support in the development of goodwill such as introductions and customer relationship information.  Executive further acknowledges that Executive will receive significant consideration in connection with the Offer and the Merger and that Executive is entering into this Amendment as a material inducement for Parent and the Buyer to enter into the Merger Agreement. Executive expressly acknowledges and agrees that the restrictive covenants that he has entered into in the Employment Agreement, as amended hereby, are reasonable and enforceable in all respects, ancillary to an otherwise enforceable agreement and no greater than necessary to protect the Company’s legitimate goodwill, confidential information and legitimate business interests.  Except as expressly modified hereby, the provisions of the Employment Agreement are and shall remain in full force and effect.

4.Governing Law.  This Amendment shall be deemed to be made in the state of Texas, and the validity, interpretation, construction, and performance of this Amendment in all respects shall be governed by the laws of Texas without regard to its principles of conflicts of law.

5.Effectiveness.  This Amendment shall be effective on the date first written above upon execution and delivery by the parties. This Amendment shall automatically terminate without any action on the part of any person and be void ab initio if the Merger Agreement is terminated in accordance with its terms, and neither the Company, Buyer nor any other person shall have any liability to Executive under this Amendment if the Closing does not occur.

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6.Counterparts.  This Amendment may be executed in two or more counterparts, each of which shall be deemed an original, but all of which taken together shall constitute one and the same instrument.

[Remainder of Page Intentionally Left Blank - Signature page follows]

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IN WITNESS WHEREOF, the parties have executed and delivered this Amendment on the date first written above.

ATHLON HOLDINGS LP
By:
	Name:
	Title:
Executive

EX-10.2

Exhibit 10.2

AMENDMENT TO EMPLOYMENT AGREEMENT

This AMENDMENT (this “Amendment”) to the Employment Agreement, dated as of August 7, 2013 (the “Employment Agreement”), between Athlon Holdings LP (the “Company”), and                        (“Employee”), is dated as of September 27, 2014, and is effective as of the Closing (as defined in the Merger Agreement).

WHEREAS, in connection with that certain Merger Agreement by and among Athlon Energy Inc. (the “Seller”), a Delaware corporation, Encana Corporation, a Canadian corporation (“Parent”), and Alenco Acquisition Company Inc., a Delaware corporation and indirect, wholly-owned subsidiary of Parent (the “Buyer”), dated on or about September 27, 2014 (the “Merger Agreement”) the Company and the Employee wish to amend the Employment Agreement as provided herein as a material inducement for Parent and the Buyer to enter into the Merger Agreement.

WHEREAS, as a result of the Merger Agreement, Employee shall be conveying goodwill in the Company and receiving significant consideration and this Amendment, which is ancillary to the Merger Agreement, furthers Parent’s, Buyer’s and their respective affiliates’ interest in protecting such goodwill.

NOW, THEREFORE, in consideration of the mutual agreements and understandings set forth herein and other good and valuable consideration, the receipt and adequacy of which hereby are acknowledged, the parties hereby agree as follows:

1.Amendment to Section 5(a) of the Employment Agreement. Effective as of immediately prior to the consummation of the Offer (as defined in the Merger Agreement) (the “Effective Time”) Section 5(a) of the Employment Agreement shall be deleted in its entirety and replaced with the following:

5(a).“Employee shall not, at any time during the Restriction Period, directly or indirectly engage in, have any equity interest in, interview for a potential employment or consulting relationship with or manage or operate any person, firm, corporation, partnership or business (whether as director, officer, employee, agent, representative, partner, security holder, consultant or otherwise) that engages in any business which competes with any portion of the Business (as defined below) of the Company in the United States; provided, however, in the event the Company terminates Employee’s employment without Cause, the Employee resigns for Good Reason or the Employee resigns for any other reason, in each case, following a Change in Control, the post-termination restrictions set forth in this Section 5(a) shall be limited to the following: (a) Employee shall not, at any time during the Restriction Period following the Date of Termination, directly or indirectly engage in, have any equity interest in, interview for a potential employment or consulting relationship with or manage or operate any person, firm, corporation, partnership or business (whether as director, officer, employee, agent, representative, partner, security holder, consultant or otherwise) that engages in any business which competes in any material respect with any

material portion of the Business (as defined below) of the Company within the fifty (50) mile area set forth in Exhibit A attached hereto. Nothing herein shall prohibit Employee from being a passive owner of not more than 2% of the outstanding equity interest in any entity that is publicly traded, so long as Employee has no active participation in the business of such entity.”

2.Amendment to Section 5(d) of the Employment Agreement.  Effective as of the Effective Time, the definition of “Restriction Period” in Section 5(d) of the Employment Agreement shall be amended by deleting the following phrase:

“except that if Employee’s termination of employment occurs within one year following a Change in Control, Restriction Period shall mean the period beginning on the Effective Date and ending on the date six (6) months following the Date of Termination”

3.Company Commitments; Continuing Effect of Employment Agreement; Merger Consideration.  Employee acknowledges that the Company has provided and the Company agrees, as long as Employee continues as an employee of the Company, to continue to provide Employee with access to its confidential, proprietary, and/or trade secret information of third parties such as customer, suppliers, and business affiliates; knowledge regarding the Company’s methodologies and business strategies; and support in the development of goodwill such as introductions and customer relationship information.  Employee further acknowledges that Employee will receive significant consideration in connection with the Offer and the Merger and that Employee is entering into this Amendment as a material inducement for Parent and the Buyer to enter into the Merger Agreement. Employee expressly acknowledges and agrees that the restrictive covenants that Employee has entered into in the Employment Agreement, as amended hereby, are reasonable and enforceable in all respects, ancillary to an otherwise enforceable agreement and no greater than necessary to protect the Company’s legitimate goodwill, confidential information and legitimate business interests.  Except as expressly modified hereby, the provisions of the Employment Agreement are and shall remain in full force and effect.

4.Governing Law.  This Amendment shall be deemed to be made in the state of Texas, and the validity, interpretation, construction, and performance of this Amendment in all respects shall be governed by the laws of Texas without regard to its principles of conflicts of law.

5.Effectiveness.  This Amendment shall be effective on the date first written above upon execution and delivery by the parties. This Amendment shall automatically terminate without any action on the part of any person and be void ab initio if the Merger Agreement is terminated in accordance with its terms, and neither the Company, Buyer nor any other person shall have any liability to Employee under this Amendment if the Closing does not occur.

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6.Counterparts.  This Amendment may be executed in two or more counterparts, each of which shall be deemed an original, but all of which taken together shall constitute one and the same instrument.

[Remainder of Page Intentionally Left Blank - Signature page follows]

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IN WITNESS WHEREOF, the parties have executed and delivered this Amendment on the date first written above.

ATHLON HOLDINGS LP
By:
	Name:
	Title:
[Employee]