Contact Information: Contact: M. Bradley Davis Senior Vice President of Capital Markets bdavis@magnumhunterresources.com (832) 203-4545
Magnum Hunter Resources Corp. Announces New $150 Million Senior Secured Revolving Credit Facility
| Source: Magnum Hunter Resources
HOUSTON, TX--(Marketwire - October 26, 2009) - Magnum Hunter Resources Corporation (NYSE Amex : MHR ) (the "Company") announced today that the Company has received a
commitment for a new $150 million three-year term senior secured revolving
credit facility ("the new bank facility") provided by the Bank of Montreal
("BMO"). The new bank facility will be used for general corporate
purposes, including the acquisition of crude oil and natural gas
properties.
The new bank facility will be governed by a semi-annually redetermined
borrowing base value assigned to the Company's proved crude oil and natural
gas reserves. An initial borrowing base of $25 million has been
established. Based on values assigned to crude oil and natural gas
properties which may be either acquired or discovered over time, the
Company's borrowing base may be increased up to a maximum of $150 million
commitment level.
All other terms and conditions are those usual and customary for this type
of commercial bank borrowing facility. The applicable interest rate margin
for this new bank facility will range from LIBOR plus 2.50% to LIBOR plus
3.50% depending on the actual level of outstanding borrowings. The final
agreement which includes the specific terms and covenants governing the
Company's new bank facility will be filed with the Securities and Exchange
Commission at closing.
BMO will act as Lead Arranger, Book Runner and Administrative Agent for the
Company's new bank facility. It is anticipated that the final closing of
this new bank facility will occur by November 15, 2009.
Management Comments
Mr. Ronald D. Ormand, Executive Vice President and Chief Financial Officer
of the Company, commented, "As part of our strategy to position the Company
for future growth, we are pleased to have received this new $150 million
revolving credit facility. We appreciate the work performed by the senior
credit officers at the Bank of Montreal to put this new lending facility
into place during a difficult period in the overall financial markets.
Having one of the premier lenders to the North American energy industry
approving a $150 million facility is a testament to senior management's
track record with the banking industry, as well as our relationship with
BMO in particular. The new credit facility will allow the Company to make
accretive oil and gas property acquisitions to enhance shareholder value.
Magnum Hunter now has increased financial capabilities, allowing the
Company to continue moving forward on the growth and acquisition efforts we
initiated several months ago."
About Magnum Hunter Resources
Magnum Hunter Resources Corporation and subsidiaries are a Houston, Texas
based independent exploration and production company engaged in the
acquisition of exploratory leases and producing properties, secondary
enhanced oil recovery projects, exploratory drilling, and production of oil
and natural gas in the United States.
For more information, please view our website at
www.magnumhunterresources.com
Forward-looking Statements
The statements contained in this press release that are not historical are
"forward-looking statements" within the meaning of Section 27A of the
Securities Act of 1933, as amended (the "Securities Act"), and Section 21E
of the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
including statements, without limitation, regarding the Company's
expectations, beliefs, intentions or strategies regarding the future. Such
forward-looking statements may relate to, among other things: (1) the
Company's proposed exploration and drilling operations on its various
properties, (2) the expected production and revenue from its various
properties, (3) the Company's proposed redirection as an operator of
certain properties and (4) estimates regarding the reserve potential of its
various properties. These statements are qualified by important factors
that could cause the Company's actual results to differ materially from
those reflected by the forward-looking statements. Such factors include
but are not limited to: (1) the Company's ability to finance the continued
exploration, drilling and operation of its various properties, (2)
positive confirmation of the reserves, production and operating expenses
associated with its various properties; and (3) the general risks
associated with oil and gas exploration, development and operation,
including those risks and factors described from time to time in the
Company's reports and registration statements filed with the Securities and
Exchange Commission, including but not limited to the Company's Annual
Report on Form 10-K, Form 10-K/A and Form10-K/A for the year ended
December 31, 2008 filed with the Securities and Exchange Commission on
March 31, 2009, April 29, 2009 and September 11, 2009, respectively, and
the Company's Quarterly Reports on Form 10-Q for the quarters ending March
31, 2009 and June 30, 2009, filed on My 11, 2009 and August 14, 2009,
respectively. The Company cautions readers not to place undue reliance on
any forward-looking statements. The Company does not undertake, and
specifically disclaims any obligation, to update or revise such statements
to reflect new circumstances or unanticipated events as they occur.