Constellation Energy (CEP) Enters into $350M Revolving Credit Facility

November 16, 2009 8:22 AM EST

Constellation Energy Partners LLC (NYSE: CEP) today announced that it has entered into a new $350 million reserve-based revolving credit facility with a syndicate of lenders that includes The Royal Bank of Scotland plc as administrative agent, BNP Paribas and The Bank of Nova Scotia as joint lead arrangers and co-syndication agents, together with Wells Fargo Bank, N.A. and Societe Generale. RBS Securities Inc. acted as joint lead arranger and sole book runner on the financing.

The new credit facility amends, extends, and consolidates the company's existing credit facilities, which were due to mature in October 2010. The new credit facility matures in November 2012 and has an initial borrowing base of $205 million.

Borrowing spreads under the new credit facility, which vary depending upon the level of borrowings outstanding, will range from 2.50% to 3.50% under a LIBOR-based borrowing option and from 1.50% to 2.50% under an alternate base rate borrowing option. Additionally, the company will pay a 0.50% commitment fee on unborrowed funds.

The new credit facility includes customary financial and other restrictive covenants. Among these is a requirement that the company maintain a ratio of total net debt to adjusted EBITDA of less than 3.75 times through September 30, 2010 and 3.50 times thereafter.

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