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Lone Pine Canadian subsidiary secures C$10 million in DIP financing
By Caroline Salls
Pittsburgh, Oct. 30 - Lone Pine Resources Inc. and subsidiary Lone Pine Resources Canada Ltd. entered into an agreement under which Line Pine Resources Canada will receive up to C$10 million in debtor-in-possession financing, according to an 8-K filed Wednesday with the Securities and Exchange Commission.
JPMorgan Chase Bank, NA, Toronto Branch, is the administrative agent.
The DIP facility will bear interest at the Canadian Prime rate plus 500 basis points.
The DIP credit agreement will mature on March 25.
Lone Pine Resource's Canada's obligations under the loan will be guaranteed by the parent company and specified restricted subsidiaries.
Lone Pine Resources Canada is obligated to pay the agent an upfront fee of 2% and the lenders a commitment fee of 0.75% of unused commitments.
Proceeds of loans can be used for working capital, capital expenditures and other expenditures during the course of Lone Pine's Companies' Creditor Arrangement Act and Chapter 15 bankruptcy proceedings.
According to the 8-K, Lone Pine Resources Canada is also obligated to obtain by Nov. 13 a fully executed commitment from a replacement lender for credit facilities that, together with the proceeds of a proposed share, will be sufficient to repay in full all obligations outstanding under its existing secured credit facility.
Lone Pine, a Calgary, Alta., company engaged in the exploration and development of natural gas and light oil in Canada, filed for CCAA proceedings in the Court of Queen's Bench of Alberta and Chapter 15 bankruptcy in the U.S. Bankruptcy Court for the District of Delaware on Sept. 25. The Chapter 15 case number is 13-12487.
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