Clayton Williams increases revolver's borrowing base, lowers pricing

By Angela McDaniels

Tacoma, Wash., Nov. 21 - Clayton Williams Energy Inc. amended and restated its $500 million revolving credit facility on Thursday, increasing the borrowing base and lowering pricing, according to an 8-K filed with the Securities and Exchange Commission on Monday.

The borrowing base was increased to $475 million from $350 million; however, the lenders are not required to advance more than $350 million of loans. Any increase in the total commitment amount requires the consent of each lender.

The borrowing base is based on the discounted present value of future net cash flows from oil and gas production. It is redetermined semiannually in May and November.

The interest rate is Libor plus 175 basis points to 275 bps, and the commitment fee is 37.5 bps to 50 bps. Before the amendment, the margin over Libor was 200 bps to 300 bps.

All interest rates and fees are determined based on the aggregate credit exposure expressed as a percentage of the borrowing base.

The amendment also increased the amount of certain purchase money debt and capital lease obligations that the company is allowed to have outstanding to $20 million from $15 million and increased the amount of senior notes that it may have outstanding to $800 million from $475 million.

As of Sept. 30, the company had $349.52 million of senior notes outstanding.

JPMorgan Chase Bank, NA is the administrative agent.

Clayton Williams is a Midland, Texas-based oil and gas company.

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