Southern Pacific lines up C$150 million five-year term loan at Libor plus 1,000 bps

By Susanna Moon

Chicago, March 26 - Southern Pacific Resource Corp. said it lined up a five-year first-lien term loan for a U.S. dollar-equivalent amount of C$150 million at Libor plus 1,000 basis points.

The company entered into a fully underwritten loan agreement with Credit Suisse AG and its affiliate on Wednesday, according to a press release.

The facility, which matures March 28, 2019, replaces the company's C$100 million first-lien credit facility due May 31, 2014.

Also, at the company's election, any optional prepayments upon a change of control will be made at 102% of the principal amount.

The new facility removes the restrictive financial and negative covenants and replaces them with less restrictive covenants.

The incremental liquidity will allow the company to implement its near-term development plans, which are expected to significantly increase corporate production from both STP-McKay and STP-Senlac.

Settlement has been slated for March 28.

Southern Pacific is a Calgary, Alta., energy exploration, development and production company.

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