Crimson Exploration completes $175 million second-lien term loan

By Sara Rosenberg

New York, Dec. 30 - Crimson Exploration Inc. closed on a new $175 million second-lien term loan due Dec. 27, 2015, according to an 8-K filed with the Securities and Exchange Commission.

Barclays acted as the lead arranger, bookrunner and administrative agent on the deal that was completed on Dec. 27.

Pricing is Libor plus 950 basis points with a 3% Libor floor, and the loan was sold at an original issue discount of 96.

The loan is non-callable for one year, then at 102 in year two and 101 in year three.

Included in the loan are covenants related to financial performance, permitted debt, minimum hedging requirements to limit commodity price risk and asset dispositions.

Proceeds were used to repay the company's existing $150 million second-lien term loan at par plus accrued interest, to pay off a $2 million subordinated promissory note, and to reduce revolver borrowings.

Oaktree Capital Management, a principal stockholder of Crimson and a holder of a portion of the second-lien term loan that was repaid, has participated in the new term loan.

In connection with the new loan, the company amended its existing revolver to extend the maturity to May 31, 2013, to permit the incurrence of the new debt and to revise covenants to provide more financial flexibility.

Also, the borrowing base under the revolver was reduced to $88.75 million from $95 million as a result of the issuance of the second-lien loan.

Crimson Exploration is a Houston-based independent energy company.

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