Southwestern Energy Company (SWN) today announced that it entered into a $750 million three-year term loan agreement and used its proceeds to pay down balances under its existing credit facility and commercial paper program. The term loan is unsecured and includes an interest rate calculated based upon the Company’s credit rating (currently 137.5 basis points over the current London Interbank Offered Rate). The term loan is prepayable at any time and requires prepayment from the net cash proceeds of any issuance of debt or equity securities and sales of assets, with certain exceptions. The other provisions in the term loan are substantially the same as those contained in the existing revolving credit facility.
The Company also filed an automatic shelf Registration Statement (“new shelf”) on Form S-3 that will replace the Company’s former automatic shelf Registration Statement on Form S-3 dated November 9, 2012 (“old shelf”). The old shelf expired on November 13, 2015, the third anniversary of its effective date, in accordance with the rules pursuant to the Securities Act of 1933. The Company filed the new shelf due to the expiration of the old shelf and not in anticipation of any specific securities offerings.
“We are pleased with the strong support from our banks in moving $750 million of our existing debt to the term loan and increasing our liquidity. We are committed to creating long-term value to our shareholders. The actions announced today reflect sound financial policies that are aligned with this commitment. We also remain committed to a flexible capital program that is responsive to the commodity price environment and anticipate outstanding debt to remain flat or decline throughout 2016,” remarked Steve Mueller, Chairman and Chief Executive Officer of Southwestern Energy.
Southwestern Energy Company is an independent energy company whose wholly-owned subsidiaries are engaged in natural gas and oil exploration, development and production, natural gas gathering and marketing. Additional information on the company can be found on the Internet athttp://www.swn.com.