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The maximum total net debt to EBITDAX leverage ratio ("Leverage Ratio") in the Credit Facility has been amended as follows: Second Quarter 2009 - 4.25 to 1; Third Quarter 2009 - 4.50 to 1; Fourth Quarter 2009 - 4.75 to 1; First Three Quarters 2010 - 4.75 to 1; and Fourth Quarter 2010 - 4.25 to 1. The Leverage Ratio reverts back to 4.0 to 1 thereafter.
For purposes of calculating the Leverage Ratio, the definition of Net Debt was also revised to exclude the following debt amounts (which will be deemed to be an equity component of the Company's 4.375% Senior Convertible Notes due 2028 - under a newly adopted accounting pronouncement described below): approximately
This new accounting pronouncement, FASB Staff Position (FSP) Accounting Principles Board (APB) 14-1, "Accounting for Convertible Debt Instruments That May Be Settled in Cash upon Conversion", effective
The Credit Facility was also amended to add a new senior debt to EBITDAX covenant (with a maximum ratio of 2.25 to 1) which excludes debt attributable to the Convertible Notes and is less restrictive than the Leverage Ratio.
Carrizo Oil & Gas, Inc. is a
Statements in this news release that are not historical facts, including but not limited to those related to confidence of Carrizo's banking syndicate in Carrizo's assets and business strategy, financial flexibility, ability to maintain compliance with terms of the credit agreement and restriction of capital expenditures are forward-looking statements that are based on current expectations. Although Carrizo believes that its expectations are based on reasonable assumptions, it can give no assurance that these expectations will prove correct. Important factors that could cause actual results to differ materially from those in the forward-looking statements include market and other conditions, capital needs and uses, actions of lenders under the credit agreement, commodity price changes, effects of the global financial crisis on exploration activity, results of and dependence on exploratory drilling activities, operating risks, land issues, weather, and other risks described in Carrizo's Form 10-K for the year ended
Contact: Carrizo Oil & Gas, Inc. Richard Hunter, Vice President of Investor Relations Paul F. Boling, Chief Financial Officer (713) 328-1000
SOURCE Carrizo Oil & Gas, Inc.