Prospect Global cuts cash amount needed to repay senior secured debt

Lender has agreed to extinguish $153.1 million of debt for $15 million

By Devika Patel

Knoxville, Tenn., April 4 - Prospect Global Resources Inc. said it has negotiated an agreement to extinguish its senior secured debt.

The agreement allows the company to reduce the cash amount needed for the debt reduction to $15 million from $25 million. The company plans to pay this amount from the proceeds of a planned public offering.

The company has until April 23 to raise this capital.

Prospect Global said in a press release that it has about $153.1 million of obligations with this lender. This amount, which is due in July 2015, will be extinguished with the $15 million payment.

The company will also increase the lender's royalty interest to 3% from 2% and issue additional common shares and warrants.

Based in Denver, Prospect Global is a resource exploration company.

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