on March30 said it has entered into an amendment to its first-lien credit agreement,creating a second-lien position that reduces the first-lien position by abouthalf, to about $35 million, among other changes.
Theamendment also allows the first-lien position to pay a reduced cash interestrate of LIBOR plus 150 basis points, down from the former rate of LIBOR plus800 basis points, as well as an 11% annual payment in kind. The second-lien positionwill accrue its interest payments in kind at a 30% per annum rate, reducingAtlas' cash interest burden, according to a news release.
The companyis now required to maintain a minimum of $2 million in EBITDA on atrailing-12-month basis, starting with the quarter ending June 30. Also, thesecond-lien credit agreement requires Atlas to maintain an asset coverage ratioof not less than 2:1, starting with the quarter ending Sept. 30, 2017.
As part ofthe second-lien credit agreement, Atlas agreed to issue within 30 days to itslenders warrants to purchase up to 15% of its outstanding common units at 20cents per unit.
Inaddition, Atlas executed the incorporation into the first-lien credit agreementof the financial covenants included in AtlasResource Partners LP's credit agreement, starting with the quarterending June 30.
Thefirst-lien credit agreement is scheduled to mature Sept. 30, 2017, and thesecond-lien credit agreement March 30, 2019. Both are subject to an optional12-month extension, according to the release.
AtlasEnergy's common units were trading at 50 cents over the counter as of the closeof trading March 30.