TXCO Resources gets court OK of $32 million DIP facility

By Jennifer Lanning Drey

Portland, Ore., June 8 - TXCO Resources Inc. obtained final court approval of its $32 million debtor-in-possession credit facility Tuesday from the U.S. Bankruptcy Court for the Western District of Texas, according to attorneys.

As previously reported, the DIP lenders are current term lenders, including Double Black Diamond Offshore, Ltd.

Interest on the DIP loans will be Libor plus 400 basis points on extensions of credit up to $7.5 million and Libor plus 1,000 bps on extensions in excess of $7.5 million, with Libor being subject to a 3% floor.

TXCO paid an origination fee of 1% of the total commitment upon closing of the interim facility, with a fee of 2% of the total commitment being due at maturity.

The DIP loans will mature on the earliest of six months after the company's bankruptcy filing and the effective date of a court-approved plan of reorganization.

TXCO, a San Antonio-based energy company, filed for bankruptcy on May 18 in the U.S. Bankruptcy Court for the Western District of Texas. Its Chapter 11 case number is 09-51807.

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