LRR Energy seeks waiver of requirement, plans to pay down facility

By Jennifer Chiou

New York, Feb. 4 - LRR Energy, LP is seeking a waiver of the requirement under its second-lien term loan that requires it to use 50% of the net proceeds from its proposed $75 million at-the-market offering of common units to repay borrowings under its term loan, according to a 424B5 filing with the Securities and Exchange Commission.

The company stated that it expects to receive the waiver and, in that case, it plans to use the net proceeds from the offering for general partnership purposes, including the repayment of borrowings under its revolving credit facility.

LRR said that if it doesn't obtain the waiver, it will use 50% of the net proceeds to repay borrowings under the term loan and the remaining net proceeds for general partnership purposes, including paying down revolver borrowings.

As of the end of 2013, the weighted average interest rate on the company's outstanding debt was 3.88%, which was based on $200 million of borrowings outstanding under the revolver and $50 million outstanding under the term loan.

LRR Energy is a Houston-based limited partnership formed by affiliates of Lime Rock Resources to operate, acquire, exploit and develop producing oil and natural gas properties in North America.

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