Foresight Energy reveals structure, talk on $1.1 billion facility

By Sara Rosenberg

New York, Aug. 6 - Foresight Energy LLC released structure and price talk on its $1.1 billion senior secured credit facility with its bank meeting on Tuesday, according to a market source.

The facility consists of a $500 million five-year revolver and a $600 million seven-year covenant-light term loan, the source said.

Price talk on the revolver is Libor plus 325 basis points with no Libor floor, and talk on the term loan is Libor plus 375 bps to 400 bps with a 1% Libor floor and an original issue discount of 99, the source continued.

The term loan has 101 soft call protection for six months and amortization of 1% per annum.

Included in the revolver are maximum net senior secured leverage and minimum interest coverage ratios.

Incremental facility allowance is for $100 million plus an amount where net secured leverage is less than 2.25 times, subject to 50 bps MFN with an 18-month sunset provision.

Mandatory prepayments are 100% of asset sale proceeds subject to reinvestment rights, 100% of debt issuance proceeds and 50% of excess cash flow with leverage-based step downs to 25% at 2.25 leverage and 0% at 1.75 times leverage.

Commitments are due at noon ET on Aug. 15, the source added.

Citigroup Global Markets Inc., Morgan Stanley Senior Funding Inc., J.P. Morgan Securities LLC, Deutsche Bank Securities Inc. and Credit Agricole Securities (USA) Inc. are the lead banks on the deal.

Proceeds will be used to fund a tender offer for the company's $600 million 9 5/8% senior notes due 2017 and to finance a dividend payment.

The tender offer expires on Aug. 19.

Foresight is a St. Louis-based producer of thermal coal.

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